Representative Zack Stephenson has revamped his Minnesota sports betting bill, adding daily fantasy sports, allowing electronic pull-tabs and doubling the proposed taxes.
The legal sports betting bill began to move through the House on March 21, with Stephenson championing legal, statewide digital sports betting for at least the last three years.
Passing with an 8-4 majority, the A-21 amendment was followed by the bill’s approval at 8-5. The bill is now headed to the tax committee.
Minnesota has no crossover deadline, with the state set to adjourn on May 20. However, if sports betting isn’t legalized this session, lawmakers must wait until 2025 and craft new bills due to them not carrying over.
It’s been six years since lawmakers in the state first began trying to legalize Minnesota sports betting. Stephenson was able to get a bill through the House in 2022, but it fell in the Senate. level.
One of the biggest stumbling blocks for any bill has been the discussion on horse racing. There has been disagreement on whether the state’s horse tracks should be included in any wagering offerings.
But a senate bill which includes horse tracks has now been through six committees, with a tax rate set to 20%. That bill is now set to go before the finance committee.
Pulltabs Are A Contentious Topic In Minnesota Sports Betting
These new amendments will build a regulatory structure around the currently unregulated fantasy sports market. Stephenson did not go into detail, however, with the amendment not yet publicly available,
But at the centre of the changes are pulltabls and charitable gaming. Under the current setup, the state of Minnesota takes the biggest amount of tax revenue from charitable gaming, followed by the game developers and finally the charities themselves.
The amendment seeks to flip that scenario on its head, sending up to $40 million to the Allied Charities of Minnesota (ACM) over the next few years.
But there has been disagreement festering on how the pulltab machines work. With advancing technology, the state’s tribes claim machines are getting closer than ever to resembling slots, which fall under the tribe’s exclusive rights to casino games.
State Democrats passed a law last year which banned an “open-all| feature on pulltabs. Instead, every tab on the game needs to be opened individually. The ACM claims this slows the consumer down, and could ultimately affect income due to the longer length of games.
Although not directly related to sports betting, pulltabs and charitable gaming have become somewhat of a political football for the Minnesota sports betting bill.
Stephenson hopes to take this issue out of the dialogue by increasing the proposed tax from 10% to 20%.
Horse Tracks Still Part Of Discussion
As part of the discussions, the committee also spoke with Tracie Wilson, CFO of Running Aces, on of the state’s two horse tracks.
Wilson testified that the tracks would be “badly damaged by the unfair amendment,” adding that horse racing would be “eviscerated by this legislation, which picks winners and losers.”
Executive director of the Minnesota Indian Gaming Association (MIGA), Andy Platto, said the tribe will continue to evaluate the bill.
However, he added that some policy changes were concerning for tribal leaders. Despite these concerns, though, he gave MIGA’s full support to the Minnesota sports betting bill.
Historically, MIGA, which included the state’s 11 tribes, has not supported any bill that includes horse tracks.
Stephenson told media that he has been working closely with the ACM and tribes for some years, adding that the current deal is a compromise that “both sides can live with.”
The bill currently moving through the Senate has already seen proposed tax rates increase to 20%, as well as eliminating in-game betting. The Senate bill excludes horse tracks, as well as the latest pulltab agreement brokered by Stephenson.