Michigan lawmakers have a tough decision to make. Should they lead the way to allow for and regulate online gambling, following the lead of Nevada, New Jersey and Delaware, or punt on the opportunity to generate money for the state much like the rest of the U.S.?

Earlier this month, Michigan State Senator Mike Kowall introduced "The Lawful Internet Gaming Act." It recognizes that Internet wagering on games of chance and skill is a core form of entertainment for millions of individuals across the world, and argues that it is in the best interest of Michigan to regulate such activity by authorizing it and establishing a system whereby Internet gaming licenses are provided after eligibility is determined on a case-by-case basis.

If passed and entered into law, The Lawful Internet Gaming Act would allow licensees to offer a variety of Internet games, including poker. A total of 8 licenses may be granted to the total pool of applicants, at a fee of $5 million per license. Michigan will also stand to earn money based on a 10% tax on gross gaming revenue.

"This is definitely a right step by Michigan to allow the residents of the state to gamble online," said a spokesperson from RealMoneyAction.com. "The $5 million up-front license cost is not a huge expense for casino companies, and it actually acts as a deposit."

Private casino operators and federally recognized tribes with casino operations in place will have the opportunity to apply for one of the prized licenses. They should have the requisite funds to take advantage of a law that allows for online gambling.

While online gambling in Michigan would include poker, do not expect any bill passed by Michigan lawmakers to include a provision that allows for betting on the outcome of sports games. The Professional and Amateur Sports Protection Act (PASPA) is a federal law that makes it illegal for a governmental entity to sponsor, operate, advertise, promote, license or authorize by law or compact any betting, gambling or wagering scheme based on one or more amateur or professional sports events.

The state does have some experience with online sales in the realm of sweepstakes and contests. It became one of the first states to expand its lottery to allow for online sales in January 2015.

Michigan is considering Senator Mike Kowall's legislation as a few other states deliberate about similar bills. California, New York and Pennsylvania have all discussed the possibility of legalized, regulated online gambling within their borders. Interestingly, the bill proposed by Kowall leaves the door open for Michigan licensees to potentially be able to accept wagers from individuals not physically present in the state. That would open the floodgates for online gambling across the U.S.

Published on: Apr 25, 2016