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  • Why legalizing sports betting (still) faces such long odds at the Legislature this year

    Posted on September 26th, 2019 akth No comments

    Legal sports betting may be coming to Minnesota. However, it does not appear to be in much of a rush.
    Consider the Senate bill that could partially conjure sports novels in Minnesota narrowly slipped from its first questionnaire Thursday (and faces an uncertain response during its next stop). The majority leader of the Senate isn’t keen on the idea. The nation’s 11 Native American tribes are opposed. Anti-gambling and many religious organizations are opposed. And, oh yeah, it will not increase much money.
    There is this: the House bill on the same topic has not been set for a hearing, lacks support from DFL leadership, also faces lots of the same obligations as the Senate bill.
    Other than that, it’s a certain thing.
    Introduced by Senate Taxes Committee Chair Roger Chamberlain, R-Lino Lakes, the Senate’s sports betting bill, SF 1894, does have sponsorship from the Republican and DFL senators. Plus it created its first official appearance before Chamberlain’s own committee Thursday. “This is a business, it is a profession, it’s amusement,” Chamberlain said. “Individuals do make a living from the… and they also have a lot of fun.”
    And even though it isn’t lawful in Minnesota, there are many men and women who gamble illegally or via offshore mobile or online sites. Chamberlain thinks by legalizing and regulating it, the condition could bring to the surface what’s now underground.
    But sports gambling is a minimal profit business for casinos; much of what’s wagered is returned to players as winnings, which means that could be subject to state taxation,”the grip,” is comparatively modest. Chamberlain’s bill would tax that amount — the sum of wagers minus winnings — at 6.75 percent.
    State Sen. Roger Chamberlain
    MinnPost photograph by Peter Callaghan
    State Sen. Roger Chamberlain
    “Many states think it’s a money-maker for them also it may be,” Chamberlain said. “But we’re not in this to increase a whole lot of revenue. We would like people to take part in the business and have some fun doing this.” Casinos and race tracks could benefit using sports gambling as a way to bring more people in their casinos,” he said.
    The bill claims that if the nation’s tribes wish to offer sports betting, they would have to request a new compact with the state, something required by national law. The country is obligated to bargain in good faith and that includes agreeing to some kind of gambling already permitted off reservation.
    Nevertheless, the executive director of the Minnesota Indian Gaming Association, John McCarthy, said Thursday that the tribes have lots of concerns about both the House and Senate bills, and are in no hurry to add sports betting to their operations.
    McCarthy said the tribes have invested billions of dollars in gaming facilities and utilize them to raise money to pay for”human services, schools, clinics, home, nutrition plans, wastewater treatment centers, law enforcement and emergency services, and other solutions.”
    “Since these operations are crucial to the ability of tribal governments to meet the requirements of the own people, MIGA has had a longstanding position opposing the expansion of off-reservation gaming in Minnesota,” McCarthy explained. The cellular aspects of the bill, he explained, would”create the largest expansion of gambling in Minnesota in more than the usual quarter-century, and therefore MIGA must respectfully oppose SF1894.”
    He said the tribes were particularly concerned about mobile gambling and how it might lead to even more online gaming,”which signifies an even more significant danger to all sorts of bricks-and-mortar facilities which currently provide gaming: Japanese casinos, race tracks, lottery outlets, and pubs with charitable gambling.”
    Additionally opposed was an anti-gambling expansion set and a religious social justice organization. Ann Krisnik, executive director of the Joint Religious Legislative Coalition, mentioned the state financial note that said the revenue impacts of the bill were unknown.
    “It is unknown not just concerning revenue, but it’s unknown also concerning the ultimate costs this creates for the nation,” Krisnik said, citing social costs of more gambling.
    Jake Grassel, the executive director of Citizens Against Gambling Expansion, said the bill was a bad deal for the state. “The arguments in favour of legalizing sports betting may appear meritorious at first blush — which is, bringing an unregulated form of betting from the shadows,” Grassel said. “Upon further reflection and consideration, the costs are too high and the advantages are too small.”
    A method to’start conversations with the tribes’
    The Senate bill ultimately passed the Taxes Committee with five votesno votes and a”pass.” Two other members were also absent. It now goes to the Senate Government Operations Committee.
    After the taxation committee vote, Chamberlain stated he considers this a way to begin conversations with the tribes. Even if the bill passes, it doesn’t take effect until September of 2020. And compacts would need to be negotiated to clear the way for on-reservation sports gambling.
    “We are optimistic that they will come on board,” Chamberlain said of these tribes. “Their business model won’t continue forever. Young folks do not visit casinos. I go to them sometimes with my spouse and others and often I am the youngest one there and I’m within my mid-50s. We think it is a business enhancer.
    “I understand their care but we are right there together and when they get more comfortable and more individuals know more about it, I’m convinced we’ll move,” he said.
    Later in the afternoon, Senate Majority Leader Paul Gazelka said the GOP caucus hasn’t met to discuss the issue and he isn’t in a rush. He explained the mobile gambling aspects are of special concerns to him and he’s personally opposed.
    “I really do know that it needs more time and that’s the 1 thing I am gonna ask of this invoice,” Gazelka said. “It is come forward around the nation and we’re gonna have to deal with it just like any other matter. But it’s not a partisan matter.”
    Some thorny questions that are legal All this became possible when the U.S. Supreme Court ruled last spring that Congress had exceeded its power when it announced that sports gambling was illegal (except in Nevada, in which it was operating at the time). New Jersey had sued to clear the way for sports novels at its struggling Atlantic City casinos.
    The decision quickly led states throughout the country considering whether to legalize and regulate sports gambling. Eight already have, and polls indicate legalizing sports betting has wide popular support.
    The problem for the nation’s gambling tribes is if they would make enough from the brand new gaming choice to compensate for the potentially massive expansion of this off-reservation. There’s also no clear response to whether tribes can do much with mobile gaming, because the federal Indian Gaming Regulatory Act that generated the economic increase of casino gaming allows gambling only on bookings. Though some countries have declared that having the computer servers that process bets on reservations is sufficient to obey the law, the problem has not yet been litigated.
    Both the House and Senate bills also increase a thorny political and legal dilemma because they apply state taxes to tribal gambling, something the federal Indian Gaming Regulatory Commission has ruled is not allowed. While tribes in other nations have agreed to share gaming revenue with countries, it has come with valuable concession — such as tribal exclusivity over gambling.
    Even though the House bill gives the tribes a monopoly for the time being, the Senate version cuts the nation’s two horse racing tracks in on the action. A 2018 evaluation of the problem for the Minnesota Racing Commission calls sports betting a”momentous threat” to racing, but notes that each of the countries but one that have legalized sports gambling have let it be offered at race tracks. According to the commission, the Thoroughbred Idea Foundation has concluded that”he obvious means of minimizing the possible negative effects of legalized sports gambling on the racing industry would be to allow sports betting at racetracks and to direct internet revenues to the aid of racing and breeding in the state. ”
    The Senate bill allows a kind of mobile betting but requires the use of geofencing to ensure the bettor is within state boundaries and needs them to get an account that’s been created in person at the casino or race track. It also generates a Minnesota Sports Wagering Commission, which would make rules such as what kinds of bets will be permitted and control the games.

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