- A promising Minnesota sports betting bill did not advance out of committee
- The bill, which had the support of several key groups, is now in limbo
- Sen. Matt Klein’s bill found a compromise solution between tribes, charitable organizations, and racetracks
Minnesota’s sports betting hopes may have been dashed against the rocks during its first committee hearing of this year’s legislative session.
Sen. Matt Klein’s (DFL-53) bill, SF 757, a bill to legalize retail and online sports betting for the state’s 11 Native American Tribes, today did not move out the state and local government committee.
The committee voted 6-6 on the bill, which did not receive the necessary votes to move forward.
Supported Bill Defeated in Committee
For the past several years it seemed as if the major hurdle facing legalized Minnesota sports betting was a disagreement between state tribes, charitable organizations, and racetracks as to who should control sports betting in the state.
Klein’s bill was the first to find a compromise between all three groups. Klein’s bill would have given control over Minnesota sports betting to the state’s 11 tribes.
The following tribes would have been eligible to offer retail and/or online sports betting:
- Bois Forte Band of Chippewa
- Fond du Lac Band of Lake Superior Chippewa
- Grand Portage Band of Chippewa
- Leech Lake Band of Ojibwe
- Lower Sioux Indian Community
- Mille Lacs Band of Ojibwe
- Prairie Island Indian Community
- Red Lake Nation
- Shakopee Mdewakanton Sioux Community
- Upper Sioux Community
- White Earth Nation
In exchange for providing the tribes control over sports betting, each organization licensed to conduct lawful charitable gambling in the state would have qualified for tax relief payments. Payments would have been made on a “pro rata basis according to the organization’s combined net receipts.”
The bill would have also established a new racing economic development account, providing payments to the state horse tracks. The first $12.5 million in revenue would have been earmarked as follows:
- 40% to a licensed racetrack that primarily conducts standardbred horse racing
- 60% to a licensed racetrack that primarily conducts thoroughbred and quarter horse racing
Any amount exceeding $12.5 million in the fund would have been distributed as follows:
- 28% to a licensed racetrack that conducts standardbred horse racing
- 72% to a licensed racetrack that primarily conducts thoroughbred and quarter horse racing
The tribes, charitable organizations, and Canterbury Park, one of the two state racetracks, supported the legislation.
“Tribal leaders are committed to working with the state and stakeholders to bring legal and regulated sports betting options to Minnesota consumers,” Andy Platto, Executive Director of the Minnesota Indian Gaming Association, said during the hearing.
Randy Sampson, Chairman and CEO of Canterbury Racetrack, said the organization trusts any legislation that supports the tracks, tribes, and charitable gaming organizations.
He lauded Klein for his work on the bill and for bringing all three groups to an agreement.
“It’s taken a long time to build the trust necessary to get to this compromise,” he said.
The bill included a 22% sports betting tax rate and set the legal age to participate at 21.
Committee Wary of Problem Gaming and Online Sports Betting
Despite the first-ever agreement between tribes, tracks, and charitable organizations, several members of the Senate State and Local Government Committee shared strong concerns over legalized online sports betting.
Sen. Erin Maye Quade (DFL-56) said she was hesitant to allow an industry into Minnesota that preys on those vulnerable to addiction.
There are barriers to gambling in Minnesota, she said. Customers have to make a conscious decision to drive to a casino, spend money on gas, take an extra effort to gamble, but legalized online sports betting would change everything.
“You can gamble under this bill from your bed, the carpool lane, from the boardroom, the shower, and that’s what the predatory mobile sports betting industry is hoping for. They’re betting on that. Not everyone is addicted to gambling that could be addicted to gambling,” she said.
Quade noted the bill should disallow all college sports betting, further limit push notifications from online sports betting operators, and prohibit all in-game betting as well.
Sen. Steve Drazkowski (R-20) criticized the bill for not having a fiscal note. He also noted the bill will likely increase problem gaming and increase government spending to deal with the problem.
The bill will knowingly create a societal problem, he said.
“We tax the industry we’re allowing and authorizing in the bill. We pile that money up in the government, and we develop government and programs with the hope that the government and programs will solve the problem we created with the bill. Members, I call that insanity… I don’t think we should be doing bills that create problems with the hope that government will come along and fix them. Because as we know it doesn’t, and it won’t,” he said.
Sen. Heather Gustafson (D-36) acknowledged the need to regulate offshore sports betting and gambling taking place in the state, but said she had too many concerns to ultimately support the legislation.
So What Now?
The defeat of Klein’s bill is a huge blow to Minnesota’s legalized sports betting hopes. There will likely be other bills introduced this session, but few that will have the support of the state tribes, racetracks, and charitable gaming organizations.
The bill will likely have to go through several changes if Klein hopes to bring it back to the committee, which could put the compromise between the tracks, tribes, and charitable organizations in danger.
If eventually approved by the committee, it would have five other committee stops before eventually moving to the Senate floor.
The Minnesota sports betting bill, which aimed to legalize sports betting in the state, has failed to advance from committee despite initial promise and support from lawmakers. The bill, which was introduced earlier this year, sought to allow for sports betting at tribal casinos and racetracks in Minnesota.
The bill faced opposition from various groups, including anti-gambling advocates and some tribal leaders who raised concerns about the potential negative impacts of legalizing sports betting. Despite these concerns, the bill had gained momentum and support from lawmakers who saw it as a way to generate revenue for the state and provide a new form of entertainment for residents.
However, the bill ultimately failed to advance from committee, with some lawmakers citing the need for further study and discussion before moving forward with legalization. Others expressed concerns about the potential impact on problem gambling and addiction rates in the state.
While the failure of the bill is disappointing for supporters of sports betting in Minnesota, it is not necessarily the end of the road. Lawmakers may revisit the issue in the future and work to address concerns raised by opponents. In the meantime, residents of Minnesota will have to continue to travel to neighboring states like Iowa and Wisconsin if they wish to place bets on sports.
Overall, the failure of the Minnesota sports betting bill to advance from committee highlights the complexities and challenges of legalizing sports betting in a state with diverse opinions and interests. It remains to be seen whether lawmakers will revisit the issue in the future and work towards finding a compromise that satisfies all stakeholders.
