The Minnesota committee on government and local affairs ended deadlocked, 6-6, on an industry friendly legal digital wagering bill and tabled a second. Lawmakers in the state have been trying for at least five sessions to legalise sports betting, to no avail.
The committee heard testimony on SB 757 from the gambling industry, charitable gambling, problem and responsible gambling groups and others, before a lively and passionate question-and-answer period with bill sponsor Matt Klein. Klein was peppered with questions and comments about gambling addiction, the price of entry into the market and why the state should allow betting on college sports.
His bill would have tethered 11 sports betting licences to the state’s tribes and sent 45% of tax revenue to charitable gambling. It earmarked another 15% of state tax revenue for Minnesota’s horse tracks. Those provisions solved key problems that have come up in the state before.
Klein may have gotten pushback from the tribes about the wording of the bill and how they would pay the state. But that turned out to be the least of the issues.
“Today’s hearing was disappointing considering there was an agreement in place at the end of last year’s session and even further agreement the year before that,” Brendan Bussmann, managing partner at B Global, told iGB. “It’s unfortunate that Minnesotans are leaving for other states for sports betting while silly conversations happen in committee that are based on nothing but misinterpreted hearsay.”
Minnesota is surrounded by legal sports betting jurisdictions, including four US states and one Canadian province.
Quade dominates conversation with concerns
Senator Erin Maye Quade dominated discussion, calling in-game betting the “most predatory” kind of gambling. She also questioned why the state would legalise betting on colleges, if the legal betting age was set at 21. Quade said college athletes “are kids, they don’t have security or an entourage, they live in dorms and sororities and fraternities”.
She went on to say that removing betting on college sports and in-play betting “would go a long way”. But for the gambling industry, such restrictions mean lower handle and revenue. The industry has also argued across the US that restricting any betting markets only drives bettors to the illegal market.
Quade also suggested that Klein amend his bill to have the state set betting limits for consumers.
“The state of Minnesota telling everyone you can’t bet on your device more than $200 a day?” Klein said. “It takes away self-determination and I could not support that.”
Licensing fees questioned
When Quade gave way to Senator Steve Drazkowski, he told Klein that he thought licensing and renewal fees would “create a barrier to entry… only the big guys are going to get in.”
Klein’s bill set the application fee at $250,000 (£199,000/€239,000) with an $83,000 annual renewal fee.
The comments are somewhat hollow. There are many states, from Pennsylvania to New York to Illinois, with application fees well over $1 million. In New York, operators paid a $25 million application fee. And any operator who wants a stand-alone mobile platform in Illinois must pay $20 million.
In Missouri, which is in the process of promulgating rules, the proposed application and renewal fees for retail sportsbooks is $250,000. It is $500,000 for digital sportsbooks. A bill in the Hawaii senate calls for application and renewal fees of $250,000.
Drazkowski also pointed to legal wagering “creating new crimes”. He was referencing a section of Klein’s bill that outlines penalties for harassing athletes over betting. He said the bill would be “anticipating… that we are going to create plans for a new crime because of this. I call that insanity.
“I don’t think we should create bills that create problems that the government will fix because that doesn’t happen.”
Second bill tabled
A second bill, HB 978, was tabled at bill sponsor John Marty’s request. Marty held a lopsided anti-gambling hearing in January that stakeholders called a “media stunt”. Marty told the committee on Thursday that he does not support the idea of gambling expansion. He said if it is going to happen, his bill offered far more protections than Klein’s.
Among them, HB 978 called for no gambling advertising at events in which 30% or more of the audience is under 21. Klein’s bill set that number at 10%. He also said that he favours banning gambling advertising in public buildings or venues. Minnesota’s professional sports stadiums, he said, are all owned by the state.
After his introduction, Marty moved that his bill be tabled.
The hearing was potentially the end of a gambling expansion discussion in Minnesota for this year. There are currently no house bills on the topic. Last year, gambling champion Zack Stephenson brokered a deal in the waning hours of the session. Leadership never called his reworked bill to a vote. He has since stepped away from carrying gambling legislation.
Original article: https://igamingbusiness.com/sports-betting/minnesota-sb-757-sports-betting/
