After a strong showing but no eventual vote in 2016, lawmakers in Michigan have made up for lost time and approved a bill that would legalize online gambling. Bill S-203, also known as the iGaming bill, passed by a 7-1 vote in the Senate Regulatory Reform Committee.
The hearing in Michigan occurred just one day after a big push for similar laws in Pennsylvania, where a committee also approved the legislation. Big names from the poker world, like representatives from Amaya, the Poker Players Alliance, and the Coalition to Stop Internet Gambling, testified at both hearings, but the battle isn’t quite over just yet.
While Michigan’s senators almost unanimously support the bill, gaming tribes are split. Of the 12 tribal operators in the state, four of them have expressed outright opposition to the bill, while others like MGM, Detroit Entertainment and Greektown Casino, are neutral.
The push back comes from how the bill proposes dealing with taxation in the new market. The current law, the Indian Gaming Regulation Act of 1988, says the state is not allowed to tax tribes on gambling operations. The new iGaming bill states that only operators that agreed to be taxed could participate in an online gaming market, which essentially takes away the tribe’s sovereign tax immunity.
If the tribes choose a fighting route, they could potentially have a legal leg to stand on in claims that the state has voided its compact with them. This would allow tribes to withhold their revenue-share payments to the state and even mean they could operate online gambling within the borders of their reservations.
There are only three states that have legal online gambling as of now: New Jersey, Delaware and Nevada. The Michigan bill is similar to those in other states, but proposes no limit to the number of potential licenses.
Photo credit: BagoGames (flickr) [https://creativecommons.org/licenses/by/2.0/]
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