After the U. S. Department of Justice issued their famous dictate in 2011 that the Wire Act of 1961 only applied to sports betting, many thought there would be a stampede towards individual states offering online gaming and poker to their constituents. After all, with rising budget deficits and few areas to further tax (or to even raise taxes at all), local and state governments had to find other ways to raise revenues for their coffers. As we’ve seen, however, that expected stampede has been more like a Sunday stroll, with only three states – Delaware, Nevada, and New Jersey – stepping up to pass online gaming regulations.
This doesn’t mean that other states haven’t at least thought about acting. Some shockingly have actually put up bills (sorry, a bit of sarcasm there) for passing regulations on the industry. But, as of yet, there isn’t another state that has joined the trio from 2013. To demonstrate how illogical it has gotten when it comes to passing online gaming and poker regulations, we look towards Michigan for the latest in the legislative world of online gaming politics.
Until late last year, Michigan wasn’t even on the radar for those looking at which state would be the next to pass online gaming regulations. After passing online lottery sales in 2014, the state sprung to life in October 2016, with Michigan State Senator Mike Kowall stating that a bill regulating online gaming and poker regulations could “still pass.” While that bill did make it out of its Senate committee, it did not come to the floor of the Michigan Senate for a vote and, perhaps more importantly, it didn’t have companion legislation in the Michigan House for consideration.
Now, according to Crain’s Detroit Business journalist Lindsay Vanhulle, the Michigan Legislature is trying to accommodate their desire for more money for government while quelling the cries from those anti-gaming forces who would normally look to shut them down. The plan would utilize the three commercial casino gaming outlets licensed by the state – the Motor City Casino, the MGM Grand Detroit, and the Greektown Casino, all located in Detroit – and the Indian casinos as the outlets for online casino gaming. There is one catch that would make the Michigan online industry much different from the others.
Under the legislation being discussed, those in Michigan would be able to access online gaming and poker, but it would only be if they were physically located on a casino property in the Wolverine State. There are a few reasons for this caveat in the Michigan regulations. One is the state casinos and the Indian casinos aren’t happy about potentially losing some of their revenues to online gaming (estimates say that Detroit alone could lose between $1.5 and $4.5 million if the law passed). If the players were at least on the casino grounds, there could be revenue generated for the casino from other streams (restaurants, shopping, etc.). This doesn’t make much sense to…well, anyone who is talking about the Michigan regulations.
Since players are already in a casino, why would they want to play online? This was a question posed by David Schwartz, the director of the Center for Gaming Research at the University of Nevada-Las Vegas, when contacted by Vanhulle. “Would you drive to Home Depot to use Amazon to buy something?” Schwartz is quoted by Vanhulle. “I probably wouldn’t, as nice as Home Depot is. I want the convenience of getting something at home.”
The biggest issue seems to be avoiding the constituents of Michigan, however. The state Constitution was amended in 2004 with a clause that required any new gaming expansion – be it live or online – to be put up for referendum to Michigan voters. It would be necessary for those voters to approve of the action by majority vote. The only clause that works around that amendment is if the gaming comes from any of the state operations or the Indian casinos – those arenas can do seemingly whatever they want without approval from the citizens.
Whether this or any legislation in the state of Michigan moves forward is highly unlikely. Although they can talk a good game, politicians in Lansing are going to have a tough road getting the Michigan casino industry to give up any of their profits. It will also be difficult to get through anti-gaming forces, which are being led by anti-online gaming crusader Sheldon Adelson, to even reach the voters for their opinions. As such, don’t expect Michigan to become the fourth state with online gaming and/or poker anytime soon.
