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Why legalizing sports betting (still) faces such long odds at the Legislature this year

Legal sports gambling may be coming to Minnesota. But it does not seem to be in much of a rush. Consider the Senate bill that could partly conjure sports novels in Minnesota narrowly slipped from its first questionnaire Thursday (and faces an uncertain response at its next stop). The vast majority leader of the Senate isn’t keen on the thought. The nation’s 11 Native American tribes are opposed. Anti-gambling and several religious organizations are opposed. And, oh yeah, it doesn’t raise much money. There is this: the House bill on precisely the exact same topic has not been set for a hearing, lacks assistance from DFL leadership, and faces many of the very same obligations as the Senate bill. Other than that, it’s a sure thing. Inspired by Senate Taxes Committee Chair Roger Chamberlain, R-Lino Lakes, the Senate’s sports betting bill, SF 1894, will have exemptions from both Republican and DFL senators. And it made its first official appearance before Chamberlain’s own committee Thursday. “This is a business, it is a profession, it’s amusement,” Chamberlain said. “People do make a living off of this… and they also have a great deal of fun” And even though it isn’t legal in Minnesota, there are many men and women who gamble illegally or via offshore mobile or online sites. Chamberlain thinks by legalizing and controlling it, the condition might bring to the surface what’s now underground. But sports gambling is a minimal profit business for casinos; much of what’s wagered is returned to players as winnings, which means that could be subject to state taxation,”the hold,” is comparatively modest. Chamberlain’s bill would tax that amount — the sum of wagers minus winnings — at 6.75 percent. State Sen. Roger Chamberlain MinnPost photo by Peter Callaghan State Sen. Roger Chamberlain “Many nations think it is a money-maker for these and it may be,” Chamberlain said. “But we are not in this to raise a great deal of revenue. We would like people to take part in the company and have some fun doing it.” Casinos and race tracks could benefit using sports betting as a way to bring more people into their casinos, he said. The bill says that if the state’s tribes want to offer sports betting, they’d need to request a new compact with the state, something demanded by national law. The state is obligated to bargain in good faith which includes agreeing to any kind of gaming already permitted off reservation. Nevertheless, the executive director of the Minnesota Indian Gaming Association, John McCarthy, said Thursday that the tribes have many concerns about both the House and Senate bills, and are in no rush to add sports betting to their surgeries. McCarthy said the tribes have spent billions of dollars in gambling facilities and use them to raise money to pay for”human services, schools, clinics, housing, nutrition plans, wastewater treatment centers, law enforcement and emergency services, and other solutions.” “Since these operations are essential to the ability of tribal governments to meet the requirements of their own people, MIGA has had a longstanding position opposing the expansion of off-reservation gambling in Minnesota,” McCarthy said. The mobile facets of the bill, ” he explained, would”create the most significant expansion of gambling in Minnesota in more than a quarter-century, and consequently MIGA must respectfully oppose SF1894.” He said the tribes were particularly worried about mobile gaming and how it might lead to much more online gaming,”which represents a much more significant danger to all sorts of bricks-and-mortar facilities which now provide gambling: tribal casinos, race tracks, lottery outlets, and bars with charitable gambling” Also opposed was an anti-gambling expansion set and a religious social justice firm. Ann Krisnik, executive director of the Joint Religious Legislative Coalition, mentioned the state financial note that said the earnings impacts of the bill were unknown. “It’s unknown not just in terms of revenue, but it’s unknown also in terms of the greatest costs this generates for the state,” Krisnik said, mentioning societal costs of more gambling. Jake Grassel, the executive director of Citizens Against Gambling Expansion, said the bill was a terrible deal for the state. “The arguments in favor of legalizing sports betting may appear meritorious at first blush — which is, bringing an unregulated form of gambling from the shadows,” Grassel said. “Upon further consideration and reflection, the costs are too high and the advantages are too small.” A way to’begin conversations with the tribes’ The Senate bill finally passed the Taxes Committee with five votes, two no votes and a”pass.” Two additional members were also absent. It now goes to the Senate Government Operations Committee. Following the taxation committee vote, Chamberlain stated he believes this a method to start conversations with all the tribes. Even if the bill passes, it doesn’t take effect until September of 2020. And compacts would need to be negotiated to clear the way for on-reservation sports gambling. “We’re hopeful that they’ll come on board,” Chamberlain said of the tribes. “Their business model won’t continue forever. Young folks don’t visit casinos. I go to them occasionally with my partner and others and often I am the youngest one there and I am within my mid-50s. We think it is a business enhancer. “I know their caution but we’re right there with them and when they get more comfortable and more individuals know more about it, I am convinced we’ll move,” he said. Later in the afternoon, Senate Majority Leader Paul Gazelka said the GOP caucus has not met to talk about the issue and he isn’t in a hurry. He said the mobile betting aspects are of particular concerns to him and he’s personally opposed. “I do know that it requires more time and that is the one thing I’m gonna ask of this invoice,” Gazelka explained. “It is come forward around the nation and we’re gonna need to deal with it like any other matter. But it is not a partisan issue.” Some thorny legal questions All of this became possible when the U.S. Supreme Court ruled last spring that Congress had exceeded its authority when it declared that sports gambling was illegal (except in Nevada, in which it was already operating at the time). New Jersey had sued to clear the way for sports books at its fighting Atlantic City casinos. The conclusion quickly led states throughout the country contemplating whether to legalize and regulate sports gambling. Eight already have, and surveys suggest legalizing sports gambling has broad popular support. The issue for the country’s gambling tribes is if they would make enough from the new gaming option to compensate for the potentially massive expansion of this off-reservation. There is also no obvious response to if tribes can do much with cellular gambling, since the federal Indian Gaming Regulatory Act that generated the financial increase of casino gaming allows gambling only on reservations. While some states have declared that having the computer servers that process bets on bookings is enough to obey the law, the issue has not yet been litigated. The House and Senate bills also raise a thorny legal and political issue because they apply state taxes to tribal gambling, something the federal Indian Gaming Regulatory Commission has ruled is not allowed. While tribes in other states have consented to discuss gambling revenue with countries, it has come with valuable concession — such as tribal exclusivity over gambling. While the House bill provides the tribes a monopoly for now, the Senate version cuts the state’s two horse racing tracks in on the action. A 2018 analysis of this problem for the Minnesota Racing Commission calls sports gambling a”momentous threat” to racing, but notes that all the countries but one which have legalized sports gambling have let it be provided at race tracks. According to the commission, the Thoroughbred Idea Foundation has reasoned that”he most obvious way of minimizing the potential negative effects of legalized sports betting on the racing market would be to allow sports gambling at racetracks and to direct internet revenues to the aid of breeding and racing in the nation. ” The Senate bill enables a type of mobile betting but necessitates the use of geofencing to ensure that the bettor is within state boundaries and requires them to have an account that has been created in person at the casino or race track. It also creates a Minnesota Sports Wagering Commission, which will make rules including what kinds of bets will be permitted and also control the games. Read more: