Possibly within this week, Michigan is gearing up to legalize online poker, and before the holidays it is set to come true. Last year, Michigan wasn't able to make online poker legal due to a last-minute veto from the governor.
This year however, the state is giving online gaming another try, and local media outlets confirm that there is a high chance it will be passed this time.
On December 2018, Republican Gov. Rick Snyder vetoed the bill as one of his final moves as governor because he believes it would affect online lottery sales. The lottery was a resource of $1B worth of school funding, and 7% of that revenue came from online sales.
Democrat Gov. Gretchen Whitmer, who replaced Snyder, also shared the same sentiments as her predecessor when online gaming bills were re-introduced back in March. She reasoned that the 8% tax rate proposed by the legislation by Republican Rep. Brandt Iden was very low to offset any potential losses to the public education system. Whitmer wanted a 40% tax rate.
The possibility of the passage of the gaming bill for most of this year was bleak due to the rift between Iden and the current administration. However, Democratic Sen. Curtis Hertel stepped in to help out with the negotiations, helped construct a tiered tax structure for operators. Tax tiers start at a 20% rate on less than $4M in revenue, whereas the biggest earners shall be paying up to 28% if their gambling revenue exceeds $12M.
With neighboring states like Indiana and Illinois having already made the move to pass sports betting bills, Iden feels that now is the time for their state to join the online gaming bandwagon. He told local media, "If we don't do something to make sure that we are competitive in that marketplace, we are going to lose out. The longer we delay on this frankly is another day that we miss out on a dollar."
Hertel believes that the legislation shall pass through the Senate this week. It already passed the House Ways and Means Committee back in October. He even assured the media that he believes Gov. Whitmer would sign the bill before Christmas.
If it passes, the Lawful Internet Gaming Act would permit both tribal and commercial casino operators to offer online casino table games and online poker. Casinos are allowed to offer one brand for its online poker room and a separate brand for its other games, or maintain a single site for their whole operation. Aside from online poker and casino, sports betting would also be legalized.
Online operators that currently do not have a land-based partner, which is usually the case with several major online poker rooms, are required to team-up with an existing casino for them to be allowed to operate in Michigan. Obtaining a license would cost $100,000 initially and then would have a $50,000 annual renewal fee.
As of this time, Michigan has 3 commercial casinos in Detroit and 24 tribal casinos scattered across the state.
Once Michigan legalizes online poker, it shall become the 5th state to do so, alongside Nevada, New Jersey, Delaware and Pennsylvania.