Gambling expansion debate reignited in Minnesota.

  • A new bill, HF 4597, was proposed in the Minnesota Legislature to provide financial relief to horse racing tracks throughout the state.
  • A provision to allow short-term online pari-mutuel wagering on in-state events was removed from the bill after lobbying efforts from tribal gaming groups.
  • The amended bill is still likely to pass; if it does, it will reduce the obligations each track must meet to maintain its license.
  • Tribal opposition to the original bill is a continuation of a long-running debate about gambling expansion in Minnesota—a debate that the tribes have dominated so far.

SAINT PAUL, Minn.A new bill proposed to lessen the financial impact of the Coronavirus pandemic on horse racing tracks has reignited the debate about gambling expansion in Minnesota.

As introduced, this bill, HF 4597, would have created a short-term provision for online and mobile betting on horse racing through the end of 2021.

Ultimately, that provision was cut from the final version of the bill approved by the committee on May 6 after tribal gaming groups lobbied against it.

The amended bill will still provide much needed economic relief to racetracks by reducing the number of races each track is required to hold to maintain its license, and by allowing tracks to use money normally reserved for champions’ purses on other capital projects instead.

It will also increase the cut that tracks could take from advance deposit wagering programs, which allow phone and internet-based pari-mutuel wagering on out-of-state events.

Tracks still might have to hold races, despite statewide stay-at-home orders, to maintain their license. These races would almost certainly be held without spectators.

While the omission of short-term online betting was unfortunate, racetrack officials still testified to the Minnesota Legislature on behalf of the bill.

The legislature adopted proposed changes and re-referred HF 4597 to the House Ways and Means Committee on Friday.

Minnesota Gambling – An Ongoing Debate

Tribal gaming groups in Minnesota have consistently opposed legislative efforts to expand the Minnesota gambling industry.

These groups view the expansion of the gambling industry outside tribal gaming facilities as a violation of their rights as outlined by the gambling compacts they sign with the state, and fight against all efforts at expanding gambling outside of licensed tribal casinos.

In 2019, a coordinated effort of Minnesota’s tribal gambling groups helped kill a bill that would have brought legal sports betting to the state.

To effectively push gambling legislation in Minnesota, lawmakers will need to find a way to ensure that their proposals benefit tribes with gaming licenses at least as much as they benefit the state government and other non-tribal stakeholders.

As far as sports betting is concerned, Minnesota will likely need to either grant a deal of exclusivity to tribal casinos or offer another significant financial concession to pass a bill through the legislature.

If tribal gaming groups and state lawmakers can’t find common ground, the Minnesota gambling landscape will remain stagnant and never reach its full potential.

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