Here’s a brief rundown of New Jersey’s efforts to bring Las Vegas-style sports betting to the state.
LANSING – With 13 states and the District of Columbia having approved sports betting in their states since the U.S. Supreme Court paved the way for expanded gambling across the nation last year, Michigan lawmakers are resurrecting a plan to add the state into the mix.
State Rep. Brandt Iden, R-Kalamazoo, told the House Regulatory Reform Committee Tuesday that he traveled to a casino 1 mile over the Michigan border into Indiana on Saturday with his weekend fun money. He was able to place sports bets on the U-M versus Army football game (he lost $50) and another against the Lions in their NFL match against the Arizona Cardinals (he won $100),
“Always betting against the Lions, that’s a sure bet,” he said.
Iden has been the driving force behind expanding legalized gambling in Michigan. He ushered through bills last session that would legalize betting on fantasy sports and online gambling through the state’s 23 tribal and three Detroit casinos.
More: Michigan can now legalize sports betting. But will it?
More: How legalized gambling could change college football’s secretive style
Even though the bills had widespread support in the Legislature, they were vetoed by former Gov. Rick Snyder, who opposed expansion of gambling in the state and feared a loss of revenue for the state lottery, from which revenues are funneled to schools.
Iden is hoping for a different outcome with a new governor in office.
“My goal is to have this up and running by the Super Bowl. Casinos are moving forward because they know it’s going to come to fruition at some point,” he said. “If we don’t do this, we will continue to lose consumers to other states, just like you lost me to Indiana last weekend.”
The bill calls for an 8% tax on sports betting, which would generate between $8.7 million to $11.2 million in tax revenues. That’s based on a sport betting market in Michigan, both in the casinos and online, of up to $225 million.
The bill comes as the U.S. Supreme Court paved the way for legalized sports betting across the nation last year. The justices ruled that a 25-year-old federal law that has effectively prohibited sports betting outside Nevada is unconstitutional. The ruling set the stage for other states to expand legalized gambling as a source of government revenue.
People would be able to bet on both the traditional outcome of games and place live bets on things like whether a baseball pitch will be a ball or a strike or whether a field goal in a football game will be good or flubbed.
The online gambling and fantasy sports betting bills are also currently in committee, but stalled because Gov. Gretchen Whitmer has said the 8% tax rate is too low. The administration opposes the sports betting bill for the same reason, noting that 15% is a better place to land.
“I haven’t talked with the administration since before the summer break and they proposed 15%, plus the additional 3.25% for the city of Detroit,” Iden said. “That’s an astronomical rate which just will not work — that number has to be somewhere closer to 9% or 9.5%.”
The tax rates in other states that have legalized sports betting range from a low of 6.75% in Nevada to 51% in Rhode Island. If Michigan stuck with a 8% rate, it would be the second-lowest rate behind Nevada. In other nearby states, Indiana has a 9.5% tax rate while Illinois will have a 30% tax rate when sports betting takes effect early next year.
The other states that have legalized sports betting are Iowa, Mississippi, Pennsylvania, New Jersey, West Virginia, Arkansas, New York, Oregon, Delaware and Washington D.C.
“The tax rate has become a key issue with the administration and I haven’t advanced other bills to the floor until I reach an agreement with the administration,” Iden said. “It’s disappointing that it’s stalled out at this point in time, and I won’t advance this until we find some resolution.”
State Rep. Sarah Cambensy, D-Marquette, echoed the administration’s wariness with gambling bills.
“I’m fine with the bills except for the tax rate,” she said. “I think we can get to where New Jersey is — a little more creative — rather than at the lower end.”
New Jersey’s tax rate ranges from 8.5% for betting in casinos to 13% for casino-based online betting and 14.25% for racetrack-based online betting.”
Committee chairman Rep. Michael Webber, R-Rochester Hills, said he expects a committee vote on the package of bills — HB 4916-4918 — next week.
“More likely, (tax rate) changes will be made at the next committee level,” he said. “I want us to be competitive. … We have to be cognizant of what these other states around us are doing with it.”
Contact Kathleen Gray: 313-223-4430, email@example.com or on Twitter @michpoligal.
Read or Share this story: https://www.freep.com/story/news/politics/2019/09/10/michigan-sports-betting-legal-illegal/2275381001/