GitLab

Sports betting and online gaming would become legal at Michigan casinos under legislation approved Wednesday by the House, though Gov. Gretchen Whitmer continues to have issues that the growth could syphon profits from the state's iLottery.

The primary procedures in the 10-bill plan handed down 63-45 and 62-44 votes, with many Republicans and some Democrats in assistance. The legislation, which also would control the fast-growing paid dream sports industry, was sent to the GOP-led Senate for future consideration.

An 8.75% tax would be gathered on sports wagering receipts, minus jackpots paid out - less than a 19% tax now paid by Detroit's three business gambling establishments. The city of Detroit could likewise gather an additional 3.25% tax, said Rep. Brandt Iden, the sponsor of the primary bills.

The tax rate for online gambling, omitting sports bets, would vary between 4% and 19% in the first 3 years depending on much internet revenue a casino produces. It would rise to 6% to 21% in year four and, in year five and beyond, go to between 8% and 23%. Detroit might collect an additional 3.25% tax.

The state's 24 tribal casinos also could provide sports and online betting. Their revenue-sharing payments would be worked out with the state through compacts.

Iden dismissed Whitmer's concerns that school funding, which is available in part from the Lottery, might be hurt by legalizing sports betting and online betting. He stated the tax rates would be higher than under that former Gov. Rick Snyder banned in 2015.

"The tax rate went north. We got her over half of what she asked for on both" internet gambling and sports wagering, stated Iden, a Republican from Kalamazoo County's Oshtemo Township. "The money was directed to the school help fund. My instruction, from what I had constantly heard, was 'protect the school aid fund.' I believe that these bills did that. So it's extremely complicated to me when the governor states they're not in assistance."

Iden approximated the costs, if signed into law, could eventually create between $80 million and $100 million in new tax profits annually.

Rep. Rebekah Warren, an Ann Arbor Democrat, voted no after stating the legislation as composed would be vetoed. She prompted lawmakers to keep negotiating.

"We continue to have earnings issues relating to the costs' negative influence on the school aid fund," said Whitmer spokeswoman Tiffany Brown. "The administration has taken every meeting we have actually been invited to regarding this legislation and will continue to work carefully with the costs sponsor, tribal management and stakeholders to attempt to address our issues."

Whitmer aides on Wednesday provided House GOP leaders suggested modifications to the package, consisting of three options for taxation systems. Under one circumstance, rates would vary for online table games vs. online slots. In another, online slots and immediate games would not be allowed.

Whitmer also required taxing sports betting and day-to-day dream sports operations such as DraftKings and FanDuel at between 10% and 11%.

Iden explained the legislation as a consumer protection effort, noting that sports betting and online gaming already are readily available at overseas websites.

"We need to make certain that people are being safeguarded," he said. "People play. We understand people play. We have actually got to make sure that the guidelines exist."

The U.S. Supreme Court in 2018 paved the method for all 50 states to permit sports gambling. It is underway in 13 states and has actually been licensed in 5 more, according to the American Gaming Association.

At least 4 states permit their casinos to provide online poker or other types of internet gambling.

Online:

House Bills 4916-18, 4308-12, 4323 and 4173: http://bit.ly/2NDZMh5

The News & Observer AP