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Legal Developments

Governor Whitmer Signs Michigan Sports Betting and Gaming Bills into Law

Michigan Governor Gretchen Whitmer signed multiple bills into law today authorizing online sports betting, poker and gambling. She was expected to sign the bills but now it is official: Michigan has become the latest state to legalize sports betting and online gaming.

Getting to this point involved significant negotiation between the legislature and Governor Whitmer. Governor Whitmer had previously expressed concerns that legal online gambling would cannibalize funds from the lottery, which provided nearly $1 billion to the School Aid Fund last year.

The governor eventually reached a compromise with lawmakers on tax rates and allocation of revenues. Revenue generated by online gaming will go to support the School Aid Fund and Responder Coverage Fund.

Senator Curtis Hertel, who was instrumental in getting this gaming package through, praised the successful passage of the bills on Twitter this morning:

In a statement issued Friday morning, Governor Whitmer said this about the passage of the bills:

My top priority in signing this legislation was protecting and investing in the School Aid Fund, because our students deserve leaders who put their education first. Thanks in part to the hard work and leadership of Senator Hertel and Representative Warren, these bills will put more dollars in Michigan classrooms and increase funding for firefighters battling cancer. This is a real bipartisan win for our state.

Today also marks the culmination of a years-long push by Rep. Brandt Iden, chief sponsor of the bills, to authorize online gaming in Michigan. He introduced similar legislation last year only to see it vetoed at the last minute by then-Governor Rick Snyder.

He said this in a statement following Governor Whitmer’s decision to sign the bills into law:

We’ll have a safe, regulated environment for the thousands of Michigan residents who for years have been forced to travel to other states or play on risky offshore sites. Our economy will benefit as jobs are created within a growing industry. Our schools and local communities will benefit from new revenue.

Sports Betting, Online Poker and Online Casinos Coming to Michigan

The online gaming package signed into law by Governor Whitmer includes one bill each for sports betting, online gambling and poker and daily fantasy sports along with other administrative bills dealing with related issues.

The three most important bills include HB 4916 for sports betting, HB 4311 for online gambling and poker and HB 4308 for daily fantasy sports regulation.

Michigan Sports Betting Law

The Michigan sports betting bill authorizes casinos to open retail sportsbooks and launch up to one mobile betting platform in partnership with third-party providers such as DraftKings, Bet365 and so on.

Under the new law, sports betting is taxed 8.4% by the state while municipalities with casinos may assess an additional 1.25% fee. Operators are subject to a $50,000 initial application fee, $100,000 licensing fee and annual $50,000 renewal fee.

The minimum age to bet on sports in Michigan is 21 and customers may bet on pro and college sports alike. In-play betting is also authorized.

See also: Your Complete Guide to Michigan’s New Sports Betting and Gaming Laws

Online Poker and Gambling Law

In addition to sports betting, Michigan has legalized online poker and gambling. The new online gaming law allows Michigan casinos to launch up to two online gambling and poker brands. Customers must be 21 or older to play poker or gamble online.

Online gaming is taxed at a graduated rate depending on total annual revenue. Tax rates start at 20% for operators with annual revenue under $4 million and increase to a maximum of 28% for operators with annual revenue exceeding $12 million. Additionally, casinos in Detroit are subject to a 1.25% tax on revenue.

Casino and poker sites are also subject to $150,000 in total initial licensing fees plus $50,000 renewal fees each year.

Daily Fantasy Sports Law

Daily fantasy operators already operate in Michigan but are now subject to licensing requirements and standard consumer protection regulations.

Fantasy sites must now acquire a license and pay a $20,000 licensing fee plus $5,000 annually thereafter. The bill does not call for additional taxes on daily fantasy sports and establishes a minimum age of 18 to play.

Consumer protection measures include requirements that fantasy sites keep all player funds in a segregated bank account separate from operational funds, identify highly skilled players and undergo an annual audit to ensure continued financial viability.

Next Steps for Online Gambling in Michigan

Although Governor Whitmer was expected to sign the bills into law, her signature makes it an officially done deal. Now, it is just a matter of time as the Michigan Gaming Control Board gears up to adopt additional regulations, consider online gaming applications and issue licenses to suitable operators.

The MGCB has not given a definitive timeline, but we are likely looking at a Q1 2020 launch for sports betting with online gambling to follow sometime later in 2020.

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