New Minnesota Sports Betting Issue Arises As Session Winds Down

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Minnesota sports betting

Minnesota sports betting bills continue to bounce between committees as new hurdles all but doom the issue this year.

While the House Taxes Committee advanced House File 2000 Tuesday, re-referring it to the Ways and Means Committee, several legislators predicted the bill’s failure during the meeting. Multiple lawmakers said it might get through the House, but Minnesota sports betting will not pass the Senate before the session adjourns May 20.

Along with growing tension between Minnesota tribes and horse racing tracks, new Senate dysfunction also recently emerged this week. Despite a steep uphill battle, HF 2000 sponsor Rep. Zack Stephenson (Democrat-Farmer-Labor) said, “Nothing’s ever dead until Sine Die.”

Republicans write off MN sports betting

Multiple Republicans took a comment period during Tuesday’s meeting to recognize the work done on the MN sports betting issue this session. However, they also said the bill will likely not pass this year and will inform future efforts.

An industry source told LSR Tuesday the issue is dead, at least in part because of DFL Sen. Nicole Mitchell‘s arrest last week. Republican Senators hoped to bar her from voting, but while she was stripped of committee seats, Mitchell will remain with voting power.

Rep. Bjorn Olson (R) said the “nonsense in the Senate” means the bill will likely fail in the upper chamber.

“Which is sad for me that we couldn’t at least take care of our charities,” Olson said. “Instead, we kick them down with the can we kick down the road.” 

Charity tax relief big topic on Thursday

The main topic Tuesday was on Republican amendments to strip the bill of everything except a $40 million tax cut for charitable gaming organizations in the state.

The legislators argue the tax relief will not be enough to cover the decrease in business sports betting will cause.

Stephenson said without the sports betting portion of the bill, there would be no funding for the tax cut. The committee voted no on all the amendments.

Stakeholder gap grows

Because of internal party opposition to gambling issues on both sides of the aisle, there needs to be bipartisan agreement on the legislation. However, most Republicans are entrenched with the horse racing tracks and the DFL is strong allies with the tribes.

The tribes and tracks, meanwhile, are in a growing Minnesota gambling battle. The tribes want sports betting exclusivity, while the tracks want licenses. With the strong tie to the DFL, the tribes are a strong political force in Minnesota and have killed sports betting in prior sessions.

Neither side has budged on the issue, and recently, the Minnesota Racing Commission ruled the tracks can install historic horse racing machines. That was met with DFL legislation proposing to outlaw HHR machines.

Following that legislation, the tracks sued three tribal casinos in the state for offering games not included in their compacts.

Minnesota sports betting slow journey

This is the third session Stephenson has led the Minnesota sports betting negotiations. Last session saw an amendment to send sports betting revenue to the tracks, which still hoped for licenses.

Between sessions, there was hope the tracks and tribes could come to an agreement over the break.

This session started with industry proponents bullish on the state. The issues around sports betting in Minnesota, however, continue to build.

Base plan for Minnesota sports betting

Stephenson’s proposal gives Minnesota’s 11 tribes sports betting exclusivity. Minnesota sports teams support the tribal plan.

The tax rate sits at 20%. Lawmakers also recently included daily fantasy sports regulation in the bill. 

A Senate version of the bill carries an unusual in-game betting ban that also threatens the issue.