Michigan has a Lawful Internet Gaming Act

Michigan, the state of ‘Great Lakes and Great Times‘ is a pen stroke away from adding internet casino gambling to their list of great times activities.

House Bill 4311 – Lawful Internet Gaming Act yesterday negotiated its way through both houses of Michigan’s legislature.

It is now just awaiting a signature from Governor Gretchen Whitmer to become law.

A bit of deja vu really.

Michigan was in this very same position December last year. An interactive (casino and poker games) bill had passed both the House and Senate, and was on the desk of then Governor Rick Snyder ready to be signed into law. He instead chose to torpedo the bill. There were concerns it could cannibalise earnings of the State Lottery, which raises almost $1 billion annually for the Michigan School Aid Fund.

HB 4311 was re-introduced with a few tweaks by Rep Brandt Iden mid year. Following a few further tweaks in both houses, it should soon become law. That’s assuming of course Gov. Whitmer doesn’t also veto the bill. This is not expected (not impossible either).

About HB 4311

HB 4311 will allow for internet casino games (‘interactive poker and casino style games’) to be be played by adults inside Michigan state lines, offered by Michigan licensed game operators. They too must be located within state lines.

Companion Bill HB 4916 (Lawful Sports Betting Act) which has followed HB4311’s passage, will give the green light for online sports bets.

Responsibility for regulation and license approval will fall on the Michigan Gaming Control Board who will pretty much be dealing with the same operators. That’s because Internet gaming can only be conducted by ‘lawfully operating casinos in this state’. That is, currently licensed bricks and mortar casinos (or Indian Tribes).

Operator and supplier licenses will be awarded for a period of 5 years.

Operators will need to fork over a non refundable $50,000 application fee, then if successful an annual license fee of $100,000 for the first year of operation, and $50,000 thereafter.

Suppliers wanting to get in on the action will need to pay a much cheaper $5,000 application fee and annual license fees of $5,000 year 1, $2.500 thereafter.

Taxes (or lack of ) were one of the big sticking points with prior versions of the bill. They have been hiked significantly, with rates tiered based on operators’ gross revenues.

Operators (other than Indian tribes) with gross revenues less than $4 million will be subject to a 20% gaming tax rate. This scales up to 28% for operators with gross revenues of more than $12 million.

Live Dealer studios in Michigan?

The likes of Evolution Gaming and Playtech will be eagerly awaiting the Governor’s signature.

Evolution in particular have shown that they are very eager to grow their presence in the US. They already have studios in New Jersey (theirs plus a studio operated by subsidiary Ezugi), and plan to launch a Pennsylvania studio next year.

Good chance they are just as keen to slap down their $5,000 application fee in Michigan.