Michigan’s Long, Winding Road to Legal Sports Betting

Ever since the U.S. Supreme Court ruled the federal ban on sports betting unconstitutional, sports betting has been expanding across the country. While no state had a longer road to legalization than New Jersey, Michigan’s sports betting saga is particularly noteworthy. It took Michigan four years and two governors to finally legalize sports betting.

And it all started with one representative from Michigan’s 61st district.

The Man Who Sponsored Most Of Michigan’s Recent Gaming Bills

Brandt Iden was voted into the Michigan state legislature as a Republican in 2014. He ran on a campaign that, in part, emphasized job creation and a competitive business sector for Michigan. His legislative impact was small from 2015 to 2016. But in 2017, Iden began to leave his mark on the governing body.

On March 17, 2017, Iden sponsored a house resolution to make that month Problem Gambling Awareness Month in Michigan. Michigan’s House of Representatives adopted it that same day, marking Iden as an early proponent of safe gaming in Michigan.

In hindsight, it could have been an early attempt to quell anti-gambling forces within Michigan. The final bill that legalized sports betting in Michigan had three votes against. They were all Republicans concerned about problem gamblers and children having increased access to online gambling. Although the Problem Gambling Awareness Month didn’t remedy those three representatives’ concerns, it may have given Iden credibility before he took on sports betting.

However, Michigan couldn’t have legalized sports betting in March 2017 if it wanted to. Iden had to wait until the fall for even a glimmer of hope.

The Supreme Court Ruling That Changed Everything

The road to sports betting legalization started in New Jersey in 2011. When the Garden State voted to legalize sports betting, it was sued by several sports organizations. New Jersey lost.

Then, New Jersey tried to legalize sports betting again in 2014. The technicalities of that new law led the Supreme Court to grant a review of the Third Circuit’s decision to uphold the ruling against NJ. On June 27, 2017, the Supreme Court agreed to hear the case.

In particular, the high court had to determine the constitutionality of a federal law called PASPA–the Professional and Amateur Sports Protection Act of 1992. This law kept 46 states from taxing or regulating sports betting. At the time, Nevada had legal sports betting, and three other states had sports lotteries that received exemptions:

  1. Oregon
  2. Delaware
  3. Montana

On May 14, 2018, the Supreme Court ruled that it was unconstitutional for the federal government to prevent the states from regulating or taxing sports betting. The Court decided that Congress couldn’t regulate the states’ regulation of themselves. That ruling gave every state the right legalize and promulgate rules governing sports betting–if they chose.

And Representative Iden noticed.

Iden’s First Attempt To Legalize Sports Betting In Michigan

He’d spoken to tribal authorities. He’d attempted to pacify anti-gambling figures. He was a Republican representative with a Republican governor. On Sept. 12, 2017, Iden introduced two more bills to legalize sports betting in Michigan. It was a bold move, since the Supreme Court wouldn’t hear arguments until December.

However, the bills went ahead. They spent the next 15 months going through committees and additional votes. Eventually, they made it through Michigan’s House and Senate with bipartisan support.

On December 28, 2018, the bills went to the Governor’s desk.

Three days later, Governor Rick Snyder vetoed the bills.

Some Insight Into Rick Snyder’s Veto

Why did Governor Snyder veto two bills written and approved by both parties? It came down to three major concerns he raised in Michigan’s 2018 journal of the house:

  1. “Due to largely unknown budgetary concerns, I believe this legislation merits more careful study and comparison with how other states have, or will, authorize online gaming.”
  2. “For each $10 of spending on the lottery, the School Aid Fund receives approximately $2.76. Under HB 4926, because of its lower tax rate, each $10 in online betting translates to just four cents deposited into the School Aid Fund.”
  3. “I do not think it is appropriate to sign legislation that will effectively result in more gambling, with a reasonable chance that the state could lose revenue that could be helpful in dealing with social service issues that are ordinarily attendant to increased gambling behavior.”

Basically, Governor Snyder was cautious about what he saw as a drastic legal change and didn’t want to lose money directed at schools. Those concerns cost Iden his first attempt to legalize sports betting in Michigan.

Luckily for Iden, Rick Snyder’s second term was up. On Jan. 1, 2019, Democrat Gretchen Whitmer took office as Michigan’s next Governor. (And National Problem Gambling Month 2019 went off without a hitch.)

Iden’s Second Attempt–With Split Parties

Undeterred, Rep. Iden tried again. On Sept. 4, 2019, Iden introduced House Bill 4916–Michigan’s sports betting bill, which along with other gaming bills, spent a mere three months going through the same process of committees, revisions, and votes. In one-fifth of the time, the bills came out of Michigan’s legislature with the same bipartisan support.

On Dec. 19, 2019, Iden’s bills landed on Governor Whitmer’s desk.

The next day, the governor signed sports betting into Michigan law.

After four years of negotiating deals, developing legislation, and winning reelection twice, Iden got his bills passed. When sports betting went live in March 2020, Rep. Iden placed the first legal sports bet in Michigan. It was a $100 bet on Michigan State winning the Big Ten tournament. (We called the MGM Grand. Iden’s bet was most likely refunded once the Big Ten tournament was canceled.)

Why Brandt Iden Committed To Sports Betting Legislation

Rep. Iden’s personal motivations are unknown.  But strategically, it was a no-brainer issue for him to champion.

First, Iden is a business-friendly Republican who is quoted numerous times saying that he wanted to modernize gaming in Michigan. His goal was to create a competitive private gaming industry that Michigan could profit from. Second, he’s also quoted saying that he wants to eliminate bookies and protect sports betting patrons, which legalization is commonly argued to accomplish. Finally, his plan to create a legal, regulated industry is consistent with his business-friendly policy agenda. If he aspires for higher office, this sports betting episode could be part of a track record that could set him up for a successful political career. Whether he leverages it–and whether the rest of his record is strong enough to propel him forward–will be worth watching over the next few years.

Michigan Sports Betting In The Age Of Coronavirus

For all the licensing requirements, consumer protections, and competitive tax rates, sports betting’s launch in Michigan was a disaster. The coronavirus outbreak closed casinos the same week that in-person sports betting went live. Even worse, online sports betting isn’t estimated to go live until early 2021. Even if there were sports available to bet on (technically, Belarusian soccer is) Michigan bettors would be out of luck.

Although there are attempts to speed up the launch of online gambling by the recent introduction of Senate Bill 969, online sports betting is notably absent from the proposed legislation.

However, when the pandemic ends and sports return, Michiganders will have a promising sports betting industry eagerly awaiting their return. This includes widespread access to sports betting apps for mobile betting. The taxes on sports betting revenue fund Michigan’s public schools, and the regulations will protect sports bettors when they gamble. Once life returns to normal, Michigan bettors will benefit from Brandt Iden’s years of work.

See Rep. Iden’s thoughts on status of internet gaming in 2020 in our two-part interview series, here and here

About the Author

Christopher Gerlacher

Christopher Gerlacher is a writer tucked into the foothills of Colorado Springs, Colorado.