The Michigan House of Representatives has passed the 2019 Lawful Internet Gaming Act HB.4311 by a vote of 62–46. The Bill will now go to the Senate.
According to a lawmaker close to the state Governor Gretchen Whitmer, Michigan, could legalize online poker, online gambling, and sports betting before Christmas.
This development owes much to the efforts of one man, Representative Brandt Iden, who first introduced two Bills, the 2019 Lawful Internet Gaming Act with Bill no. HB.4311 and 2019 Lawful Sports Betting Act with Bill no. HB.4916.
In 2018, Iden had got the Lawful Internet Gaming Act Bill HB.4926 passed through both the House and the Senate, but then-Governor Rick Snyder had vetoed it.
Iden did not give up but re-introduced the Bill after a new Governor Gretchen Whitmer took over from Snyder.
Iden introduced HB.4311 in the Ways and Means Committee in March, where it was stalled for 6 months due to concerns raised by Governor Whitmer and the Department of the Treasury.
Governor Whitmer’s concerns are linked to online poker, online casino, and sports betting, reducing the states earning from the online lottery. Michigan dedicates entire revenue from the online lottery to the School Aid Fund.
To secure the state’s revenue, Governor Whitmer had suggested a tiered tax structure ranging from 8% to 40% and an initial license fee of $1 million with annual renewals costing $500,000.
To break the deadlock, Iden reworked the Bills to reach consensus with other parties and submitted both HB.4311 and HB.4916 to the Ways and Means Committee, which passed both the Bills by a majority vote.
Bill HB.4311 passed by the House has tiered tax rates varying from 4% to 19% for the first 3 years and then increase by 2% across the board. For the top-tier, the effective tax rate goes up to 26.25% after 3 years.
The Bill has listed an initial license fee at $ 100,000 and a renewal fee of $ 50,000.
To address all remaining doubts about school funds being impacted, Iden introduced language in the Bill, which stated that any shortfall from the state lottery below $70 million would be made up from the state’s earnings in the iGaming fund.
If the online poker, online gambling Bill passes in the Senate, any online casino which gets a license to operate in Michigan will need to have a gambling facility in the state or will have to partner with a local casino operator.
There are about 2 dozen casinos in Michigan, and they could have a windfall by partnering with established online casinos like PokerStars.