Could Michigan Become the Next US Online Poker State?

April 18th, 2016 | by Kaycee James

Michigan State Senator Mike Kowall to regulate online poker.

State Senator Mike Kowall is hoping to regulate online poker in Michigan with Senate Bill 899. (Image: senatormikekowall.com)

The US online poker scene could have a new player in the coming months if a new bill introduced to the Michigan senate is able to gain some traction.

Senate Bill No. 889 was introduced on April 15 by State Senator Mike Kowall and will look to regulate and tax online gaming activities within the state of Michigan.

Michigan Joins the iGaming Race

Joining the likes of New York and California in a bid to become the next state to copy New Jersey, Nevada, and Delaware in regulating online poker and casino gaming, Michigan’s bill will allow land-based casinos to offer online games for an annual fee.

The current incarnation of the bill, which has four co-sponsors, sets out a five-year licensing deal that will cost operators $5 million (this will serve as a deposit against future gambling taxation).

In addition to the upfront fee, any operator that picks up a license would be required to contribute 10 percent of its gross gaming revenue to the state coffers in the form of an iGaming tax.

The main thrust of the iGaming of Kowall’s bill hinges on the Department of Justice’s (DOJ) reinterpretation of the Wire Act (1961) in 2011.

After reviewing the state of online gambling and the Wire Act, the DOJ formally stated the longstanding legislation is only applicable to sports betting and, therefore, online casino games and poker couldn’t be ruled illegal under its definition.

This change of stance opened the door for state-regulated iGaming and, eventually, led to the legalization of the industry in three states.

A Matter of State Safety

Kowall’s bill address this issue and asserts that it is in the best interests of the state and its residents that the industry is overseen by the government as it reduces the risk of players playing on offshore sites.

“It is in the best interest of this state and its citizens to regulate this activity by authorizing and establishing a secure, responsible, fair, and legal system of Internet gaming,” reads the bill.

Although the bill faces a potential stumbling block in the form of opposition from tribal gaming operators that have previously reacted negatively to online lottery legalization, many believe it stands a good chance of success.

In fact, as well as offering online lottery sales, Michigan also allows residents to play real money instant win games online.

While this doesn’t necessarily mean a bill to regulate online casino gaming and poker will cut through the bureaucratic red tap like a hot knife through butter, it’s certainly a sign that local politicians aren’t completely closed-minded when it comes to online betting.