Sports Gambling

Proponents have tried to make sports gambling legal in Minnesota for the past several years. This latest attempt is the closest it has gotten. 

A bill by Rep. Zack Stephensen in the House and Sen. Roger Chamberlain in the Senate cleared committee hurdles and passed the House but failed to get a vote on the Senate Floor (where it probably would have been defeated). The House passed it in a version that the Senate would not have accepted. 

Proponents argued that making sports book gambling legal would be getting it off the black market into a regulated environment because Minnesotans were already taking their business to other states, especially Iowa and Wisconsin, or on the internet to offshore betting sites.

The House DFL proposal would have turned over the entire enterprise to the 11 tribes that are part of the gambling compact with the state. The compact allows for card games and digital gaming, including slot machines. The bill would simply expand the arrangement to include betting on sports, including mobile gaming.

The bill would have created an artificial marketplace with some consumer protection and would have made a significant investment in addressing gambling addiction.

Opponents argued that it would increase problem gambling or opposed handing it over to the tribes and wanted to see non-tribal participants have a share in the newly legalized industry. In particular, they wanted the race tracks at Canterbury and Running Aces to have a share in the activity and for Charitable Gaming to have its taxes lowered so as not to lose out when the new type of gambling comes on the scene.

A new twist would be that mobile betting accounts could be set up from anywhere in the state, so unlike Wisconsin, there would be no need for brick and mortar gambling establishments, although the bill would have allowed the Tribal Governments to franchise them. There were some guardrails on the mobile delivery in banning push notifications and establishing parameters for advertising, including banning the targeting of minors.

Revenues from bets would be taxed at 10%. About $5 million of that tax revenue would go to the Public Safety and Revenue departments for licensing and enforcement. The rest would be deposited in a special fund with half going to treat compulsive gambling and the other half to amateur sports, 20% to an “integrity and participation” fund to fund education programs for coaches and athletes against gambling and using performance-enhancing drugs the other 80% would go to youth sports programs and facilities in areas with high juvenile crime.

The Senate version differed in that it adopted a model where non-tribal business entities could participate in getting licenses from “master licensees” (which would be the tribes). This compromise did not appease those who wanted only Tribal involvement in the new area or wished for no gambling expansion at all. 

To see how this discussion played out, the Senate hearing on the bill in the final days of the session is instructive.