Minnesota Legislature Fails to Pass Sports Betting This Year

Minnesota has failed to pass sports betting this year as the state legislature adjourned the session without any action late Sunday night.

It means Minnesota residents will have to wait another year to place legal wagers on their favorite sports.

The sports betting efforts froze for this year after a Senate committee’s addition of wagering licenses for two horse racing tracks and the state’s native tribes.

Earlier in May, the Minnesota House cleared a bill that allowed exclusive sports betting for the state’s 11 tribes.

A Senate committee added amendments less than a week later, changing how the tax revenue would be allocated and depriving the tribes of their sports betting exclusivity.

The Senate version of HF 778 would extend Minnesota sports betting to two racetracks, in addition to the state’s tribes.

In both versions of the bill, Minnesotans would have been able to place retail and statewide mobile betting with a 10% tax rate in a largely competitive marketplace.

However, both versions differed over who should be allowed to offer sports betting. Unfortunately, neither side yielded to the other’s stance.

How Have We Reached Here?

Rep. Zack Stephenson announced in Nov. 2021 that he would spearhead the Minnesota sports betting initiative during the 2022 session. The lawmaker authored HF 788, allowing the 11 Minnesota tribes sports betting exclusivity.

Stephenson’s measure steered through five committees before reaching the House floor, where it was cleared by a 70-57 vote on May 12.

The Minnesota Indian Gaming Association, which has long been opposed to any sports betting bill that does not give tribes exclusivity, supported Stephenson’s bill throughout the committee hearings.

The MIGA support was critical as previous sports betting legalization efforts had failed without the backing of the tribes. Gov. Tim Walz previously made it clear he would not sign any sports betting measure that does not have tribal support.

But considering the different senate proposals, the tribal association last week wrote a letter opposing another version, saying all 10 MIGA tribes would oppose the legislation which expands commercial gaming.

Stephenson’s bill would give each of the 11 Minnesota tribes a mobile skin. Each tribe could also operate retail wagering at their casinos.

Stephenson’s proposal would tax mobile sports betting at 10%.

In addition to tribal licenses, a Senate bill allowed online and retail sports betting licenses for the Running Aces Racetracks in Columbus and Canterbury Park in Shakopee. The Senate version would impose a 6.75% tax on the new industry.

However, the Senate bill never moved during the session.

What is Minnesota Sports Betting’s Future?

Until Monday, the governor said a special session was unlikely. However, as the Minnesota Legislature missed the deadline for some key bills, a special session is still a possibility. However, even if Minnesota Legislature has a special session, sports betting is not likely to be discussed, according to a source.

The Minnesota GOP expects to take control of the House in 2023. A proposal similar to the Senate version could emerge with two GOP-led chambers. However, with the Democratic Governor still in office in 2023, the Minnesota sports betting bill without tribal support is unlikely to see the light of the day.

According to a KTSP/SurveyUSA poll, more than 60% of Minnesotans back legalized sports betting. The results from the same poll suggest that state residents prefer the Senate version of sports betting.

Senate Majority Leader Jeremy Miller has often said sports betting would require commercial entities added to clear the Senate.

The Senate’s inaction on Sunday made Minnesota among the last 16 states that have yet to legalize sports betting in some form.

Maine and Kansas have legalized the industry this year so far.