Michigan online gambling bill surfaces

News on 13 Sep 2017

Reports earlier this week that an online gambling legalisation bill is to be discussed at a Michigan House Regulatory Reform Committee hearing (see previous reports) has been followed by the publication of House Bill 4926, scheduled for the committee’s agenda today (Wednesday).

Introduced by Regulatory Reform Committee chairman Rep. Brandt Iden and three sponsors, the bill follows several attempts to get a legalisation bill through the state Senate by Sen. Mike Kowall, with the current iteration of his S.203 apparently stalled in the House committee structures whilst Kowall seeks to develop a consensus among interested parties, particularly the tribal gaming interests.

HB4926 acknowledges the right of tribal gaming interests to participate in any legalised online gambling market in Michigan as long as they are “authorized by a compact the tribe has entered into with this state under Indian Gaming Regulatory Act” and without having to waive their tribal sovereignty.

The measure envisages the formation of a state division of internet gambling, but notes that this body would not have authority over tribal internet gambling conducted under the state’s agreement with the tribes.

Proposed taxes and fees for operators include a higher 15 percent tax on GGR than the 10 percent envisaged by Kowall, unless a licensee has a prior compact with the state at a lower rate, which would then apply.

Licenses would have a life of 5 years and cost $200,000 upfront and $100,000 a year thereafter, and applicants would be required to pay another $100,000 on application.

The licenses permit online casino and poker operations.

Iden suggests that a distinction be drawn between platform providers and technology vendors, with fees of $100,000 upfront and $50,000 annually for the former, and $5,000 upfront and $2,500 a year for the latter. In both cases licenses would be valid for five years.

HB4926 has provisions for player sharing and other agreements with like-minded US states.

Today’s hearing, and the reaction of those present to Iden’s ideas, will certainly be watched with interest by the industry.

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