Minnesota legislators will again consider legalizing online sports betting, hoping this year’s tribal-focused bill is the one to satisfy all stakeholders in what has been a difficult process over previous sessions.
SF 4139 was introduced Wednesday by state Sen. and Assistant Majority Leader Nick Frentz of the Democratic-Farmer-Labor Party (DFL). The bipartisan bill is co-authored by Republicans Jeremy Miller, Eric Pratt, and Assistant Minority Leader Julia Coleman. The bill was referred to the Consumer and Commerce Protection Committee before being questioned and referred to the Rules and Administration Committee after first reading.
While there has been an appetite to legalize sports betting in the Land of 10,000 Lakes, getting all the relevant players in the same direction has proven a monumental challenge. In Minnesota, there are more players than in most states — charitable gaming, commercial operators, racetracks, and tribes. Legislative efforts go back to 2019 when current DFL Caucus Chair Zack Stephenson visited every tribe to garner support. The bill as written has the backing of Minnesota’s 11 gaming tribes.
“Members of the MN Indian Gaming Association continue to support legal sports wagering legislation, including the recent version introduced by a bipartisan coalition of Senators,” said Minnesota Indian Gaming Association Executive Director Andy Platto in a statement. “Minnesota consumers deserve to be protected, and only regulated gaming options should be allowed to operate in the state.”
The bill would make Indian Country the gatekeepers, as it calls for 11 licenses for gaming tribes, who could then partner with management services providers like DraftKings or FanDuel.
The Sports Betting Alliance (SBA) did not respond to requests from InGame to comment on the legislation.
What’s new this time around
The bill would ban prediction markets and prop bets on college sports, both flash points in the current sports betting ecosphere across multiple states. There is also a ban on push notifications for digital operators while the user’s website or application is inactive.
It would also make Minnesota the first state to require mobile sportsbooks to put daily and monthly limits on bettors accounts. SF 4139 sets default limits of $500 for the “amount of losses a person can incur or the amount of wagers a person can place in a 24-hour period,” and $3,000 for a 30-day period. Bettors can change these, but operators would be required to place the limits when an account is opened.
It also sets the default for maximum daily deposits in a 24-hour period at $500. The default length for a bettor’s cooling-off period is 72 hours, and operators are forbidden from accepting wagers during either a cooling-off period or exclusion period.
One clause that could come up for debate in the legislative process is the terminology of how a mobile sports wager is received. While the bill says regulated mobile bets can only be accepted by “the person placing the wager is physically within the state,” it notes “the incidental routing of a mobile sports wager does not determine the location or locations in which the wager is initiated, received, or otherwise made.
That language differs from the Seminole Tribe’s “hub and spoke” model for how it conducts mobile betting in Florida through Hard Rock Bet.
Same tax rate, different disbursements
The 22% tax on adjusted gross revenue remains consistent from the most recent previous version filed, but the receipts would be disbursed differently:
- 50% appropriated as relief payments for charitable gaming operators
- 15% transferred to tribal operators that do not participate in mobile sports betting or are small gaming tribes
- 15% transferred to the state’s horse racing tracks via the racing economic development account
- 15% transferred toward a “sports marketing and awareness account” that would target bringing high-profile sporting events to Minnesota
- 4% appropriated to the Commissioner of Human Services, which would likely go towards problem gaming and responsible gaming.
- 1% transferred to the state’s amateur sports integrity and participation account
Wagers placed on Indian lands would not be taxed.
Will it get traction?
Legalizing sports betting is not among the top priorities for Minnesota legislators, who have had a national spotlight shone on them for potential fraud among government services and efforts to restrict firearms following the murder of former Rep. and House Speaker Melissa Hortman.
Additionally, the House currently has an even 67-67 split between DFL and Republican membership. The bipartisan launch could help SF 4139, but politics played a role in previous sessions preventing passage of the bill.
Minnesota is the only Midwestern state lacking sports betting, though Nebraska, North Dakota, and Wisconsin currently only have tribal-based retail wagering. The Wisconsin House passed a bill authorizing online expansion last month, but the Sports Betting Alliance (SBA) has been against the measure due to the revenue share requirements in the Indian Gaming Regulatory Act that would require a 60-40 share that favors the tribes.
