Minnesota Bill That Would Legalize Sports Betting Reaches a Tipping Point

Last year, the prospects of legal sports betting in Minnesota failed because of an added amendment that would’ve granted licenses to horse racing tracks.

Last Updated:
Mar 14, 2023 3:23 PM ET

Read Time: 4 min

It’s been a long journey for Minnesota, as the Gopher State continues its attempt at achieving legal sports betting

Last year, Bill HF 778 passed in the House but never made it to a Senate vote. This year, however, Minnesota residents may finally see a sports betting bill make it through its legislative gauntlet.

On Thursday, the Minnesota House State and Federal Government Finance and Policy Committee has a hearing scheduled for HF 2000, a bill that would legalize both retail and online sports betting. The bill has already passed the House Public Safety Finance and Policy Committee, the Judiciary Finance and Civil Law Committee, and the House Commerce Finance and Policy Committee.

Last year, the chances of sports betting in Minnesota died in the Senate following an added amendment to grant licenses to horse racing tracks.

As a result, the Minnesota Indian Gaming Association — which represents the 11 tribes that operate 19 casinos in the North Star State — ultimately pulled its support of the bill. 

Easing the turf battle and enhancing safety

This year’s bill is making another attempt to grant sports betting exclusivity to Minnesota’s tribes. The tribes could develop their own sportsbook or they could partner with a major provider such as FanDuel, DraftKings, or BetMGM.

The proposed bill would allow bets initiated outside of tribal property to be considered tribal bets, as long as the bets are processed on tribal turf. This could eventually provide an entry point for horse tracks and professional sports teams.

Meanwhile, the bill includes several provisions to bolster bipartisan support, including set-asides for problem gambling, a post-deposit waiting period, and strict advertising rules are part of what bill sponsors hope is part of a safe sports betting experience.

One such provision was added by the House Public Safety and Finance Policy Committee last week, requiring sportsbooks to provide customer data to the University of Minnesota for research and integrity.

Potential tax breakdown

If HF 2000 passes, it will have one of the lowest tax rates in the country, and bets made on tribal land will not be taxed at all. Online sports betting sites will be taxed at a rate of 10% of net revenue received, based on a percentage of wagers placed.

The first $2.7 million collected from Minnesota’s sports betting tax would go to the Commission of Public Safety to regulate online sports betting in the state, and another $1.35 million would go to the Commissioner of Revenue.

The remaining taxes would be divided between the Commissioner of Human Services for compulsive gambling programs and the Amateur Sports Integrity and Participation account.

While HF 2000 has, thus far, moved swiftly through committees, the clock is still ticking. Minnesota’s 2023 legislative session is due to end on May 22.

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