Now heads to taxes committee

Minnesota Senate committee amends sports betting bill to ban in-game wagering

Senator Matt Klein
Reading time 2:42 min

The Minnesota Senate Commerce and Consumer Committee has approved a proposed amendment to Sen. Matt Klein’s (DFL-53) sports betting bill, SF 1949. The amendment, championed by Sen. Jordan Rasmusson (R-9) and supported by Klein, introduces substantial modifications to the legislation's scope. The bill has now been referred to the Senate Committee on Taxes.

Originally introduced during the 2023 legislative session, SF 1949 underwent amendments aimed at prohibiting in-game sports betting statewide in its latest committee hearing, establishing a precedent nationwide should it become law.

The proposed changes, heralded by Sen. Rasmusson, aim to allow regulators to take a "product safety approach" towards sports betting, incorporating practical tools to mitigate potential harms associated with problem gaming. Sen. Rasmusson emphasized concerns raised by problem gambling experts regarding the adverse impact of in-game betting on vulnerable individuals, potentially turning a single sports event "into hundreds of betting opportunities for consumers."

Another key provision of the amendment mandates sports betting users to set limits on their daily deposits or losses, with an option to opt out of this requirement, as highlighted by Sen. Klein. The committee swiftly adopted the amendment.

Despite the amendment's adoption, a proposal to prohibit betting on college sports did not receive approval during the committee session. The bill, now amended, has been forwarded to the committee on taxes for further consideration.

Sen. Klein's legislation on sports betting serves as a Senate counterpart to Rep. Zack Stephenson's (DFL-Coon Rapids) bill, HF 2000, which aims to legalize retail and online sports betting for Minnesota state tribes. The proposed legislation grants tribes exclusivity in sports betting operations, allowing each tribe to operate a retail sportsbook and offer online betting through a single digital platform.

In an attempt to accommodate state racetracks, Sen. Klein's bill allocates 30% of the state's sports betting revenue to a newly established Horse Racing Economic Development Fund administered by the Minnesota Racing Commission. The fund, capped at $20 million, would see an additional $3 million annually deposited for track utilization once the cap is reached.

Despite advancing through committee, Sen. Klein's bill encountered reservations from certain stakeholders. Andy Platto, Executive Director of the Minnesota Indian Gaming Association (MIGA), expressed concerns regarding the approved amendments.

"Some of these policy changes are of serious concern to MIGA tribes. However, tribal leaders do ask for the committee’s support of the bill as amended today so it can continue its progress in the Senate,” he said.

Tracie Wilson, CFO of Running Aces, voiced opposition to the bill's current form, citing concerns over funding disparities between state racetracks and tribes. The bill's provisions, she argued, impose caps on racetrack funding while allowing unrestricted funding for tribes and sports betting operators.

The sports betting industry also weighed in on the amendments, expressing discontent with the altered bill. Jeremy Kudon, president of the Sports Betting Alliance, lamented the prohibition of in-game betting, foreseeing a migration of Minnesota bettors to unregulated offshore operators offering such markets.

Kudon further warned of a potential revenue decrease, estimating a shortfall of over $20 million compared to initial revenue projections.

In a separate development, Sen. Klein's sports betting bill underwent further enhancements aimed at addressing problem gambling concerns. Additional provisions include the establishment of a 24/7 hotline staffed by gambling disorder and suicide prevention experts, and requiring advertisements for sports wagering to include a warning that gambling may be addictive and could cause financial hardship.

"I am proud of the work we continue to do to get this legislation in the best form possible for Minnesotans," stated Sen. Klein. "Our work continues in future committees to create a safe and trustworthy market for sports betting in our state."

The following tribes would qualify to offer retail and/or online sports betting if the bill is approved:

  • Bois Forte Band of Chippewa
  • Fond du Lac Band of Lake Superior Chippewa
  • Grand Portage Band of Chippewa
  • Leech Lake Band of Ojibwe
  • Lower Sioux Indian Community
  • Mille Lacs Band of Ojibwe
  • Prairie Island Indian Community
  • Red Lake Nation
  • Shakopee Mdewakanton Sioux Community
  • Upper Sioux Community
  • White Earth Nation
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