Progress looked so positive for Minnesota lawmakers in favor of legal sports betting. Rep. Zack Stephenson had the support of the tribal nations in the state and the charities. But the horse tracks dangled out there, not yet going along with a program which promised them $625,000 in purse assistance each year.
The tracks did not balk so much as ruffled everyone’s feathers when the state horse racing commission cast votes April 1 to allow historical horse racing (HHR) at the tracks, a move that could bring in $5.9 million a year for purses, according to the commission. Players bet on races that have already been run; these are increasingly popular in states that permit it.
The tribes balked, saying the games violate the exclusivity rights granted to them. Others say HHR isn’t legal in the state, arguing that they are just slot machines in disguise.
“Slot machines not located on tribal land remain illegal in Minnesota,” Andy Platto, executive director of the Minnesota Indian Gaming Association (MIGA) told the Minn Post. “After decades of debate at the capitol on the topic, the Racing Commission decided to usurp legislative authority and unilaterally authorize slot machines at the state’s horse tracks. We will strongly oppose any efforts to implement the Commission’s decision and will be looking at all available options.”
On April 3, Stephenson met with the House Commerce Finance and Policy Committee, which he chairs, and laid down his own law.
“I’ve deliberately left many options on the table and not drawn many red lines,” Stephenson told iGaming Business. “I’m drawing one right now. That will not happen.”
A day later, Senator John Marty introduced a bill of his own with a 40 percent tax rate on legal sports betting. The proposal also barred HHR, as well as in-game wagering. A sizable portion of the taxes collected would fund problem and responsible gambling programs.
So, what now? The tracks’ role in all this has been a thorn in the passage of sports betting for the past several years.
The racing industry in Minnesota—and other states—has suffered for years. In places like Illinois, Louisiana and Massachusetts, legal sports betting has propped up track purses.
But the situation in Minnesota just got more heated and likely more difficult to solve.
The Minnesota Department of Revenue believes sports betting could bring $40 million a year into state coffers—if it is solved.
“It seems like this is a really easy way to help make these other organizations whole, and it still doesn’t make them whole,” Rep. Anne Neu Brindley told Fox9. “I mean, we’ve seen significant losses in other states.”
Taro Ito, the CEO of Blaine’s Running Aces, says Stephenson’s proposal would devastate the horse racing industry.
“Rep. Zack Stephenson will stop at nothing in his efforts to destroy Running Aces,” Ito said.
Senator Erin Maye Quade would rather see the whole idea go away.
“But if we do decide to go down that road, then we need some really, really strong protections” for problem gamblers, she said.
