Horse Racing Bill Passes Senate, Goes to Governor Snyder for Approval

Yesterday, June 9, 2016, the Michigan Senate passed Senate Bill 504 (“SB 504”), which seeks to amend and revise the Horse Racing Law of 1995. The bill, which has gone through several iterations in both the House and Senate, now goes to  Governor Rick Snyder to decide whether to approve it.

The bill, among other things, proposes the establishment of the ‘Horse Racing Advisory Commission’ within the Michigan Department of Agriculture and Rural Development, and provides for a drastic reduction in the amount of live racing that will likely be conducted in the future. Earlier versions of the bill included language  authorizing the use of Advance Deposit Wagering (“ADW”) by the tracks. This language has since been removed.  The Michigan Harness Horsemen’s Association has suggested that ADW will be sought through rule changes working with the Racing Commissioner.

The Executive Director of the Michigan Gaming Control Board (“MGCB”), who has overseen the operation of horse racing in Michigan since 2010, previously expressed neutrality on the bill, noting significant concerns with the imposition of a Horse Racing Advisory Commission as well as the possibility for simulcast-only operations at tracks.

Click here to access the current version of SB504.

Internet Wagering Bill Substitute Reported Favorably Out of Senate Committee

On Wednesday, June 8, 2016, the Michigan Senate Committee on Regulatory Reform adopted and reported favorably substitute bill S-1 of  Senate Bill 889(“SB 889”). SB 889 was introduced by Sen. Kowall on April 14, 2016. The “Lawful Internet Gaming Act” seeks to legalize, regulate and tax Internet gaming within Michigan.

S-1 to SB 504 changes include, but are not  limited to, altering the licensing renewal schedule, and requiring licensees to engage in the prevention of fraud, and money laundering activities. As required in the previous version as well, the bill includes age verification restricted to 21 years of age and older. 

If the current legislation is ultimately passed, should any portion of the bill be found invalid by a court, the entire bill will be rendered null and void.

Under the legislation, an Internet “casino” would be required to apply for licensure to a proposed division of Internet gaming within the Michigan Gaming Control Board. Each licensee would be required to pay a $100,000 application fee and initial $5,000,000 license fee with a 10% tax on gross gaming revenues. Eligible licensees include existing Michigan commercial casino licensees and federally recognized Michigan Indian Tribes, with gaming operations within the state. In addition, the bill requires that the tribe waive sovereign immunity and enter into a compact agreement to include internet wagering with concessions to the state. 

The Committee Chairman read public testimony cards into the record as time constraints did not permit those wishing to speak to verbally testify before the Committee.  A copy of the Committee Draft Minutes from the meeting, as well as those publicly taking a position on the legislation, can be found here.

The Lawful Internet Gaming Act seeks to legalize Internet gaming while specifically prohibiting wagering on any professional or amateur sporting event unless otherwise legal pursuant to state and federal law. Supporters of the bill have estimated that the authorization of internet wagering could generate $40 million in revenue.

Click here to access the current version of SB 889.


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