Michigan Online Gambling, A Step Closer With Sept. 23 Hearing

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Michigan is a step closer to legalizing online gambling as it has scheduled a public consultation to solicit feedback on the latest draft.

The Michigan Gaming Control (MGCB) will oversee this process, scheduled on September 23, that will involve residents’ opinions regarding the latest draft of its rules for operators.

The hearing will be held online via Microsoft Teams due to the pandemic. The scheduled meeting, in which anyone can participate either through their PCs or by phone, will continue for three hours following its starting time at 1 PM.

The agenda of the rules is to protect the residents by establishing straightforward guidelines for the following:

· Responsible gaming measures
· Protections for authorized users
· Technical and security standards
· Oversight capabilities for the MGCB
· Licensing standards and procedures
· Integrity monitoring
· Internal controls for operators and third-party suppliers

Even though the licensing process has already been initiated, the rules have to be worked out before the issuance of any licenses. The ideal situation would place the finalization of the process six weeks following the digital hearing.

Red tape is bound to drag the process

Michigan is endeavoring to launch iGaming as quickly as possible. Initially, the state had aimed for the first half of 2021 as the target date.

However, the closures of brick-and-mortar casinos amid the pandemic-led crisis highlighted the significance of having online gambling as a critical revenue option. As is believed that the virus flourishes in cool weather, it is being feared that the fall could lead to the second round of shutdowns, and Michigan would be eying emergency preparedness.

Still, it is normal for the procedure to take a year, at least between the passage of an online gaming bill and the inauguration of the first gambling site in the state. There are plenty of bureaucratic glitches during this duration. In fact, most of that paperwork has to undergo several agencies and committee stages.

New Jersey was able to do it within nine months; West Virginia prolonged it to sixteen, while Pennsylvania dragged the period to two years from legalization to launch process.

After getting its bill passed in December 2019, Michigan’s early 2021 launch target wouldn’t be that bad. However, the state has been eying to push the process up to October instead.

For all practical purposes, October seems a less realistic target. According to the timeline issued by the MGCB, it allowed 30 days between the publication of the draft rules and scheduling of the public hearing, then another 18 days before the hearing itself.

In fact, it took 34 days to schedule the hearing for a date that was 27 days from the proclamation. So, this phase has stretched so far by 25 percent more than the ideal case. According to this trend in mind, November or December seems a more realistic date.

What follows the public hearing?

The good news is that the public hearing is not likely to cause any further delay of its own. People should not have much to oppose the rules, which are mostly the same as those already working fine in other states.

However, there are some regulations that could slightly bother operators. For example, some conditions about progressive slot jackpots appear designed to keep them from growing too large.

Perhaps, the reason for this restriction is aimed to avoid the process of hurting lottery sales. Yet, the operators have already given their input and are now looking forward to getting into the business as soon as possible.

Once all goes well, the next step will drive MGCB to prepare a report for the Joint Committee on Administrative Rules. Simultaneously, the final draft of the rules will be sent for review to the Administrative Rules Division. From there, it will land in Legislative Service Bureau, a body authorized to give it a formal certification.

However, the major problem at the moment lies in licensing. Currently, wrangling with the FBI over access to fingerprint data for the background check is dragging that process.

Though the obstacle is likely to be resolved, it may serve as a limiting factor in the timeline to kick off online gambling in the state.

The industry experts, including operators, are divided over the exact timeline. Some persist in their claims that a fall launch is still possible, while others are being more realistic by predicting a launch date somewhere in early 2021.

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