SKUBICK: Online gambling in Michigan starts Friday. How does it work?

Michigan

LANSING, Mich. (WLNS) – Legal online gambling officially starts in Michigan on Friday, and WLNS’ Tim Skubick weighs the pros and cons of this new form of gaming.

Michigan gamblers can officially place their bets on Jan. 22 at noon for both sports bets and casino games.

You’ve probably seen some of the commercials for gambling apps such as DraftKings or FanDuel inviting gamblers in Michigan to come play. Up to 25% of the population consists of gamblers, says Skubick.

Former GOP Brant Iden was one of the major sponsors of legal online gambling, and he just landed a new job with a national sports betting firm.

Mr. Iden says that Michigan schools may receive up to $35-50 million in funding from this betting year, and up to $100 million afterwards.

There’s no way to tell how much the industry will profit.

Now that gamblers can place bets from the comforts of their own homes, some gambling experts are worried that this will worsen gambling addiction.

“With the availability and the convenience of online gambling, we’re going to dramatically increase the number of gamblers in the state,” said former gambling addict and current addiction counselor Michael Mooney.

“Will the number of problem gamblers increase?” asked Skubick.

“I would think so. You can’t have one without the other,” said Mooney.

Mooney believes that upwards of 10% of the gambling population could get addicted.

Gambling industry promoter John Avello doesn’t necessarily agree with that.

“Would you concede that with more gamblers there will be more addiction?” asked Skubick.

“You could say that about Michigan and everywhere else. So, I guess the answer is yes to that,” replied Avello.

He doesn’t buy the “10%” figure, though.

“We want people to be safe and if they have a problem, they can come to us,” he said.

Mooney says that unlike many other states, Michigan has a hotline for problem gambling.

Those who are concerned about their gambling habits can call 1-800-270-7117 and seek help.

How does online gambling work, though?

The Michigan Gambling Control (MGCB) board authorized nine companies to operate in the state.

Native American tribes and casinos have affiliated themselves with betting sites and apps. Below is a list of each tribe/casino, their platform, and the types of gaming offered.

Tribe/CasinoAssociated Platform ProviderGaming Type(s) Offered on Jan. 22
Bay Mills Indian CommunityDraftKingsInternet Casino GamesInternet Sports Betting
Grand Traverse Band of Ottawa and Chippewa IndiansWilliam HillInternet Casino GamesInternet Sports Betting
Greektown CasinoPenn Sports Interactive/ Barstool SportsbookInternet Sports Betting
Hannahville Indian CommunityTwinSpiresInternet Casino Games Internet Sports Betting
Keweenaw Bay Indian CommunityGolden Nugget Online GamingInternet Casino GamesInternet Sports Betting
Little River Band of Ottawa IndiansRush StreetInternet Casino GamesInternet Sports Betting
MGM Grand DetroitBetMGM/Roar DigitalInternet Casino GamesInternet Sports Betting
MotorCity CasinoFanDuelInternet Casino GamesInternet Sports Betting
Sault Ste. Marie Tribe of Chippewa IndiansWynnInternet Casino GamesInternet Sports Betting

“The Michigan Gaming Control Board and the state’s commercial and tribal casinos will begin a new era Jan. 22 with the launch of regulated online gaming and sports betting,” said Richard S. Kalm, MGCB executive director. “Michigan residents love sports and, judging by inquiries we’ve received, eagerly anticipate using mobile devices to place bets through the commercial and tribal casinos.

The MGCB expects to authorize more operators and platforms in the future as staff review submissions to make sure they meet the requirements.

The MGCB expects to authorize additional operators and platform providers in the coming days and weeks as agency staff review other submissions to ensure they meet the state’s regulatory requirements.

The regulations are in place to keep safety and fairness for bettors, and they have been key concerns for the MGCB.

“We want the public to have confidence when they place wagers, and our agency has required the providers to prove they meet Michigan’s standards, which are designed to protect the participants,” Kalm said.

The tax and payment rate for online sports betting is 8.4 percent. The tax and payment rate for internet gaming ranges from about 20 percent to 28 percent.

The Detroit casinos also may be required to pay a municipal services fee and a development agreement payment to the city of Detroit.

For the Detroit casinos, online sports betting and internet gaming taxes are allocated:

  • 30 percent to the city of Detroit
  • 5 percent to the Michigan Agriculture Equine Industry Development Fund (up to $3 million per year from each tax source)
  • 65 percent to the state Internet Sports Betting Fund or the state Internet Gaming Fund

For internet gaming, a hold-harmless provision seeks to help the city recoup lost gaming tax revenue if the city of Detroit collects less than $183 million in a fiscal year.

For the tribal casinos:

  • Online Sports Betting: Payments by tribes are allocated to the Internet Sports Betting Fund (90 percent) and the Michigan Strategic Fund (10 percent)
  • Internet Gaming: Payments by tribes are allocated 20 percent to local jurisdiction governing body for services, 70 percent to the state Internet Gaming Fund and 10 percent to the Michigan Strategic Fund.

Internet Sports Betting Fund/Internet Gaming Fund

Other money collected under these acts will be used for:

  • Appropriated funding for MGCB
  • The Compulsive Gaming Prevention Fund ($500,000 annually after board expenditures)
  • The First Responder Presumed Coverage Fund ($2 million after board expenditures and compulsive gambling fund)
  • The State School Aid Fund (all money remaining after the above expenditures)

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