Michigan Sports Betting Legalization Stumbles Over A Minor Hurdle

• Rep. Brandt Iden has introduced HB 4311, the Lawful Internet Gaming Act.
• HB 4311 excludes explicit sports betting legalization and regulations.
• Sports betting has bipartisan support in the Michigan Congress.

LANSING, Mich. – Michigan sports betting legalization has hit a small roadblock. Representative Brandt Iden (R-61) has promised sports betting legislation for the current session, has delayed including the pastime in his proposals.

In an interview with sportswriter Matthew Kredell, Iden stated the reason for the delay is less about political in-fighting and more about commercial consensus among those who would operate and administer sports betting in the marketplace. This has made legal sports betting less of a sure thing for the current Michigan Congress.

“I believe it could still potentially be forthcoming, but a few things need to be worked through. The casino industry, leagues, and other stakeholders didn’t feel it was ready for primetime yet, so I didn’t introduce it.”

Of course, that’s not entirely true. Instead, Iden has laid the groundwork for sports betting by acknowledging it in his iGaming bill, which has taken over two years to reach the floor.

This bill – formally designated HB 4311, or the Lawful Internet Gaming Act – nominally legalizes Internet-based casino-style gambling, setting the industry’s rules.

Sports Betting Carve-Out In iGaming Bill

Last year, Iden attempted to get a similar bill passed, and he was successful in doing so. However, former governor Rick Snyder (R) vetoed the legislation, overriding Congress’ bipartisan support of the measure.

This version of Iden’s iGaming bill, like last year’s, actually features a carve-out for sports wagering, leading some to suggest that the pastime could be technically legalized even without an agreement with the so-called sports betting stakeholders.

Per §5.4 of the proposal, “[t]he division may permit internet gaming operators licensed by the division to accept internet wagers under this act on any amateur or professional sporting event or contest.”

What To Expect From Legal Michigan Sports Betting

Ultimately, it will likely be unnecessary to trigger Michigan sports wagering via the backdoor acknowledgment in the current iGaming bill, as the state and other involved players are keen to see the industry launch as soon as possible. As such, there are a couple of conclusions that can reasonably be drawn about sports betting in the state.

Firstly, the activity will be available at both casino venues and via the Internet (especially given the iGaming legislation currently on the floor). Whether legal domestic online gaming will roll out at the same time as that at physical land-based venues is unknown, albeit the latter has typically preceded the former by at least a few months in states that have launched both.

Secondly, sports wagering – and all other Internet-based gaming – will be taxed at a rate of 8.0 percent, which would make Michigan one of the most friendly US states for sportsbook operators. Most states are demanding considerably more for their coffers, and though Michigan could certainly use the money, it seems that the legislation has been designed to appease the commercial operators going forward.

It still seems probable that sports wagering will be legalized in Michigan during this legislative session, one way or another. However, even if Congress adjourns without doing so, you can expect the pastime to take off sometime before the end of 2020 at the very latest.