Politicians with competing sports betting bills in the Minnesota Senate joined forces this month.
Amidst the March Madness backdrop, one of the busiest times on the sports betting calendar, the issue officially became bipartisan. Sen. Matt Klein (D) and Sen. Jeremy Miller (R) are working together and with urgency to get a measure passed.
During last year’s legislative session, Klein filed SF 1949. The bill would legalize sports betting in Minnesota.
Since the bill never reached the floor for a general vote, it was carried over for the 2024 legislative session. They did the same thing with the sports betting bill in the House.
However, this year, Miller filed a sports betting bill of his own. SF 3803 was commonly called the “Minnesota Sports Betting Act 2.0.”
Klein and Miller team up for sports betting
The two bills had significant differences Klein’s legislation would give the state’s tribes exclusivity over the market. In other words, the pari-mutuel facilities would be left completely out of the new industry.
On the other hand, Miller used his legislation to close that gap. His proposal lets the pari-mutuels operate brick-and-mortar sportsbooks.
Somewhere along the way, those differences disappeared.
According to a report from local Media, Klein and Miller are now allies. The two appear to be working together to pass Klein’s bill. As a result, Klein has a rosy outlook on his bill’s future.
“I’ve got a good feeling about this,” he said recently to KARE 11. “There are people on both sides of the aisle that want to get it done this year, and we’re moving forward.”
The evolution of Klein’s bill
The holdover bill would initially provide mobile sports betting exclusivity to the state’s 11 Native American tribes. They, in turn, could partner with online sportsbook operators if they want.
The bill would collect a 10% tax from online sports betting. Conversely, brick-and-mortar sportsbooks would not have a specific tax rate.
That provision likely stems from tribes’ sovereign status. Thus, the state would earn increased revenue from larger revenue-sharing payments. Lastly, some sports betting tax revenue would be earmarked for youth sports and problem gambling programs.
The state’s major professional sports franchises originally supported the bill. They wrote an open letter to the state supporting Klein’s proposal.
However, committee members amended SF 1949 to ban in-game betting. This dampened support from key stakeholders.
While Klein and Sen. Jordan Rasmusson argued that in-game wagering contributes to gambling addictions, betting industry experts point to studies that show otherwise. A crucial issue is the amount of revenue lost due to the ban. According to the Sports Betting Alliance, the ban would cost operators at least $30 million annually.
A compromise that still needs work
Klein’s bill is much further along in the legislative process. Miller’s just began. Therefore, Klein’s bill has the best chance of reaching a floor vote soon.
Multiple committees are already familiar with it. Members began discussing the legislation in February, and only one committee stands in the way of a general vote on the Senate floor.
By comparison, Miller’s measure is still in its first committee round after one reading.
The immediate future of Minnesota sports betting is directly tied to the fate of SF 1949. Miller is working with Klein to push it through.
The tax rate in the bill was raised from 10% to 20% to account for potential lost revenue from banning in-game betting. However, lacking that type of wager could derail the bill and prevent it from reaching the governor’s desk.
Nevertheless, Miller and his new allies remain hopeful.
“I think it’s important that we get this done,” Miller told KARE 11. “I also think it’s important that we pass a bill that not only benefits the tribes but also benefits the horse racing tracks, benefits charities across the state of Minnesota, youth sports, and then, something that’s very important to me, that we have a permanent stream of funding to attract major sporting events to Minnesota.”
The longer it takes to pass a bill, the longer the state misses out on the lucrative sports betting market.
The American Gaming Association estimates that U.S. adults will legally wager $2.72 billion on the 2024 men’s and women’s NCAA basketball tournaments, “equivalent to 2.2 percent of the total handle legally wagered by Americans in 2023.”
