Attempts to get mobile and retail sports betting on the books in Minnesota failed to clear the state’s legislature before Sunday’s final day of session.
Minnesota HF 778, which was introduced by Democratic-Farmer-Labor Party Rep. Zack Stephenson, had passed through the Minnesota House by a 70-57 margin May 12.
The bill died in the state’s higher chamber, however, after disagreements emerged over the addition of state racetracks to the list of those that could offer sports betting.
Previous iterations of the legislation had limited mobile and retail wagering to Minnesota’s 11 federally recognized Native American tribes, instead of splitting them with racetracks and professional sports venues.
The Minnesota sports betting bill included a 10% tax rate on all sports betting transactions, with proceeds going toward the state’s general fund and to treat problem gambling in the state, with the remainder used to support youth sports programs in communities with high rates of juvenile crime.
What Tanked Minnesota’s Sports Betting Bill for Good?
The addition of sports betting at tracks was a poison pill for certain members of the state Senate, with the addition of Canterbury Park in Shakopee and Running Aces in Columbus being a step too far for some of the chamber’s members, such as Republican Sen. Pat Garofalo.
Garofalo told the Duluth News Tribune the state’s sports betting bill, which had broad bipartisan support as written, was derailed by a small cadre of legislators that wanted it their way or no way.
“(There are) too many legislators focused on short term political considerations instead of thinking about what is best for the whole state,” Garofalo told the Duluth News Tribune. “The sports gambling issue is symbolic of how screwed up the lawmaking process is in Minnesota.”
Ultimately, the addition of the two tracks to HF 778 drew the consternation of a broad spectrum of voices, including the Minnesota Indian Gaming Association and Gov. Tim Walz, killing any chance of getting sports betting across the finish line in 2022.
Despite the bill clearing the state’s House, HF 778 never made it onto the Senate floor for a full chamber vote before the end of the 2022 legislative session.
What Else Killed Minnesota’s Sports Betting Bill?
Another of the major issues that came up when the Minnesota House debated HF 778 was its 10% tax rate, which drew complaints from all sides.
During a House Ways and Means Committee hearing in April, Stephenson pointedly addressed the sports betting tax rate, saying the state chose a lower rate to sway those using the “black market” to wager above board going forward.
“We have a huge black market in Minnesota — there’s $2 billion in Minnesota every year spent on this and none of that money goes to problem gaming,” Stephenson said. “It doesn’t mean that people don’t have a problem gaming. They do under our current system. So we need to be honest that this is a real problem that needs to be addressed.”
Stephenson’s comments came after Republican Rep. Tim Miller questioned why — if Minnesota wasn’t going to enforce a tax rate on par with neighboring states, such as Michigan (8.4%) — they would impose taxes on sports betting transactions at all.
But despite overcoming that hurdle in the House, the bill never received any traction in the Senate.