After slumbering through the first quarter of 2016, the drive for another state to join the three United States locales that have already enacted online gaming or poker legislation grew by one with the addition of the state of Michigan.
On Friday, Michigan State Senator Mike Kowall introduced his bill SB 889, or “The Lawful Internet Gaming Act” to the Michigan State Senate. Kowall is not a newcomer to the Michigan Senate, having been seated in the legislative body since 2010 and earning reelection from the 15th District in 2014. The bill will begin its process at the Committee on Regulatory Reform (of which Kowall is a member) and look to make its way through the Michigan Legislature before the end of 2016, which will be the end of the current legislative session.
The bill itself mirrors many that have been seen in the past – the reason for enacting the legislation is to “protect the residents of the state” and it is “in the best interest of the state to regulate the activity” – and the specifics are also along the same lines with other states. Players would have to be 21 years old to participate; the activities allowed would include online poker and casino gaming; the different casinos and tribal gaming outlets in the state would be eligible for a license and licensing fees would be $5 million with a 10% tax on gross gaming revenues. Where the bill differentiates is that is explicitly allows for either a U. S.-based gaming network (interstate network or compacts) or allows for international play.
Tucked into the bill is the statement “a wager may be accepted from an individual who is not physically present in the state.” This is a stark departure from previous efforts in other states that restricted their activities to just inside their borders. With this said, there are difficulties that face the bill in the Michigan Legislature.
Michigan has casino gaming and tribal gaming, two forces that often clash as they seek to pull in as much of the market as possible. There is also a system of charitable poker rooms throughout the state that have, for the past three-plus years, been under consistent fire from the state government as to their operation and regulation. Even though Kowall is a part of the trifecta of leadership in the Wolverine State (both bodies of the Legislature and the Michigan governorship under Rick Snyder are all Republican), there may not be much stomach to expand gaming in the state right now.
With Michigan getting into the mix, it reawakens the drive for online gaming and/or poker regulation in some other areas that have perhaps tabled the issue. In California, the nearly decade-long logjam between the different parties in the Golden State (card rooms, tribal casinos and horse racing tracks) shows no sign of being broken, even though there have bene offers to the horse racing industry to get out of the way (to the tune of $60 million). Adding into the infighting issues are the charges currently pending against the “on leave” CEO of Amaya Gaming and PokerStars, David Baazov, which have thwarted PokerStars’ lobbying efforts in the state.
In Pennsylvania, it is more political infighting that has shut down online gaming and poker regulation. Despite additional revenues that would allow them to try to keep taxes a bit lower, the Pennsylvania General Assembly is still at odds over a budget for the Keystone State. At one time, online regulation was in the mix for the state but, over several rewrites of the different budgets that have attempted to move through the legislature, online gaming and poker regulation is currently not in the mix as the legislature is mired down in a quagmire.
The same is true for legislation in the state of New York. After introducing it earlier this year and actually having the regulations included in a budgetary statement, online gaming and poker regulation was removed last month as the budget moved forward without it. For the past two years (and now, it seems, three), online gaming and poker regulation has been proposed as a “talking point,” but it hasn’t gotten much further.
Since 2013, when Nevada, New Jersey and Delaware became the first three states to pass online gaming regulation of some sort, there has been an audience waiting with bated breath for the next state to come along. As this is a major election year, it is highly unlikely that any legislative body will touch a bill that has, to be honest, significant and controversial issues potentially with their constituents. Even though Michigan’s moves are interesting, don’t expect a fourth state to come along before 2017.