MI Sports Betting Advances Through Committee, On To House Floor

• MI HB 4916 went through several amendments in a House committee before being sent to the House floor.
• The tax rate for an operator’s sports betting revenue in MI has been increased and official league data has become a mandate for live betting.
• The Governor’s office in Michigan is still not on board and is asking for a higher tax rate in order to compensate for potential lost lottery revenue.

LANSING, Mich. – With the 2019 legislative session in Michigan quickly winding down, a package of iGaming and sports betting bills were passed through House Committee and sent to the House floor.

On Tuesday, the House Ways and Means Committee voted 10-1 to pass MI HB 4916. This would mark the second year in a row that iGaming and sports betting legislation would make it this far in the legislative process. While there are some similarities to last year, there are also some key differences.

What Makes This Michigan Sports Betting Bill Different?

Some of the biggest differences were made on Tuesday when bill sponsor, Brandt Iden, amended MI HB 4916 to make it more appealing to every possible stakeholder in the potential MI sports betting industry.

In the latest form of the bill, MI sportsbook operators will be mandated to use official league data. Professional sports leagues such as the NFL, NBA, and MLB will have to offer this data in commercially reasonable terms.

Iden further explained the criteria in which regulators will have to judge whether or not the data is being sold in a commercially reasonable way. The data has to come through more than just a single authorized source. Any sort of market information about the sale of the data has to come from an authorized source as well.

Several other factors went into this amendment. If those amendments hold, Michigan would be only the third state in the nation to add specific provisions regarding the use of official league data. The only other states in the country that have added this language into a bill are Tennessee and Illinois.

Another factor that makes this year’s effort for legal sports betting in Michigan different than last year is the fact that sports betting can be signed into law without the need for iGaming to pass as well.

During the final days of the 2018 legislative session, former MI Governor Rick Snyder vetoed a package of iGaming bills that contained language that would’ve legalized online sports betting in Michigan.

The Same Obstacle Lies Ahead For Sports Betting In Michigan

The biggest similarity between last year and this year, in regards to Michigan sports betting legislation, is the lack of the governor’s support.

The issue lies within the tax rate set for revenue generated by iGaming operators and legal sportsbooks in Michigan. Current MI Governor Gretchen Whitmer wants the tax rate to be higher than most states in order to compensate for the potential lost revenue from fewer people playing the lottery.

Iden introduced his sports betting bill with an eight percent tax rate to be imposed on sportsbook operators and told LegalSportsBetting that he’d be willing to raise that amount if need be.

“That was a starting point for me…I’m willing to come up a little bit on that if that’s what the governor is looking for but it can’t be 40 percent. That’s just an unrealistic number,” said Iden.

Governor Whitmer has proposed a 40% tax to be levied against iGaming operators and 15% tax against sports betting operators.

Iden’s latest amendments raised the sports betting tax rate to 8.75% for tribal casinos and 12% for the three commercial casinos in Detroit. The tax rate for iGaming providers would range from 4% to 23% depending on how much revenue the company is generating.

During Tuesday’s committee meeting, Iden named various stakeholders who have submitted their support of his bill including DraftKings, FanDuel, Motor City Casino, the NBA, the MLB, and even the Huron Band of Potawatomi.

But, without the support of Governor Whitmer, there is a chance that history will repeat itself and a veto could be waiting at the finish line once again.

News tags: Brandt Iden | Gretchen Whitmer | House Ways and Means Committee | MI HB 4916 | Michigan | Rick Snyder