Almost a year after former Gov. vetoed a similar bill, Michigan has now become the 6th State to offer online poker legally.
A week before Christmas, Gov. Gretchen Whitmer signed HB 4311 on the morning of Friday, December 20, thereby making sports betting and online casino games including online poker officially legal in Michigan.
Whitmer's signature came nearly a year after former Gov. Rick Snyder vetoed a similar bill that could have legalized online gambling and sports betting at the latter part of 2018. He vetoed the bill due to concerns that online gambling would affect the revenue coming from the state lottery. Last year, the lottery sent $1 billion to the education sector and 7% of that was 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."
The new legislation is estimated to bring almost $20 million to the state. Revenue from online gaming and sports betting shall support the First Responder Presumed Coverage Fund and the School Aid Fund.
Whitmer told local media, "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."
Also included in the bill, revenue from online gambling shall be used also to fund "road repairs and improvements, public safety programs and anti-gang and youth development projects", among others.
Now referred to as Michigan's Lawful Internet Gaming Act, the Michigan Gaming Control Board (MGCB) shall be in charge to issue state-specific licenses to operators wanting to offer online games for real money within state borders.
Thanks to Whitmer's signature, Michigan has become the 5th state to legalize online casino games, 6th with legal online poker and 20th to legalize online sports betting. The Wolverine State Michigan now joins Nevada, New Jersey, Delaware, West Virginia and Pennsylvania as states that legally allow online poker.
Nevada, New Jersey and Delaware have been sharing player pools for around 18 months, whereas Pennsylvania began only in November and has its own player pool within its border. West Virginia's online poker infrastructure is yet to launch.