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Outgoing Michigan Governor Halts Online Poker's Progress

Online poker hope had blossomed in Michigan, but a last-minute veto put a stop to progress.
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  • After looking poised for legalization, it's back to the drawing board for online poker in Michigan.

What appeared to be a big step for online poker in the United States has come to a screeching halt.

Former Gov. Rick Snyder, whose term ended when the calendar turned over, used one of his final legislative acts to shut down a bill that would have legalized online poker in Michigan. The veto came through on Dec. 28, about a week after a surprise late push resulted in strong passage by Michigan lawmakers in the House and Senate.

As a result, online poker struck out in the U.S. in 2018 after it looked for a short while like two straight years would see a state with major population legalize the game, following Pennsylvania in 2017.

Bill Gets Late Passage

There was little inkling of online poker making major progress in the U.S. in 2018 until some late November reports emerged that Michigan lawmakers were attempting to get it across the finish line before the end of the year.

Lo and behold, just a few days before Christmas, those lawmakers made good on their words. They rallied strong support in both of Michigan's legislative houses, where the "Lawful Internet Gaming Act" passed easily. Republicans Mike Kowall in the Senate and Brandt Iden in the House led the pushes, which passed 33-5 and 71-35, respectively.

The bill was termed "industry friendly," with relatively low fees and taxes set to encourage plenty of operator activity. Additionally, the hard legwork of getting all stakeholders, including the sometimes hard-to-please tribal interests, had been done.

All that remained was final signature by Gov. Snyder, a fellow Republican, and online poker would officially be legal in Michigan. Many media outlets trumpeted victory, and poker players in Michigan had cause to celebrate, or so it appeared.

Snyder's Not-So-Fond Farewell

Rather than a friendly wave and his blessing on his way out, Snyder gave poker players the proverbial middle finger and a slammed door before riding into the sunset.

On Dec. 28, word hit the news wire that Snyder had vetoed a slew of bills before his term ended, with online gambling among the fallen. Snyder explained that his concerns with the bill centered around possible cannibalization of established gaming and lottery entities, as well as expansions of gaming in general.

"I do not think it is appropriate to sign legislation that will effectively result in more gambling" --
Gov. Snyder

"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," he wrote.

Rep. Iden called the veto "incredibly disappointing" in an interview with OnlinePokerReport.

“We had no idea this was coming," he said. "We had all the stakeholders supportive of the package and we had alleviated any concerns, so this is a very surprising outcome.”

Snyder's professed concerns raise the specter of the possibility he was influenced by Sheldon Adelson, the most staunch opponent of online gaming in U.S. and a long-time, high-level contributor to the Republican Party. They echo many of the talking points espoused by Adelson's Coalition to Stop Online Gambling, as outlined by Flush Draw.

In actuality, online gambling has not resulted in lower brick-and-mortar revenues or lottery revenues in states like New Jersey. Additionally, millions of dollars in revenues were earmarked for things like schools, public transport and compulsive gambling help, OPR reported.

Prospects for Michigan Online Gambling Going Forward

While Snyder's veto threw a major roadblock in the progress of online poker in Michigan, hope isn't totally dead. The fact that Iden and Kowall were able to round up so much support and craft a bill that pleased nearly everyone involved indicates there's still a decent chance going forward.

While Iden will be sticking around, Kowall will join Snyder on the sidelines after also being termed out. However, the strong margin of 33-5 in the Senate should bode well for future prospects there. A major unknown is whether the new governor, Democrat Gretchen Whitmer, will prove more receptive than her predecessor.

The state's population of about 10 million, ranking 10th in the U.S., makes it a very high-value ground for online poker passage, should it eventually join the shared liquidity network.

Iden told OPR he will keep pushing so as not to lose the momentum gained in 2018, and he's confident he can eventually see the bill to the finish line.

"All I can do is hope that all the partners are willing to stick with the positive progress and bring it to fruition," he said.

Some outside observers are considerably less rosy. A new government with a new governor will bring new dynamics, including higher levels of urgency on some issues that could take precedence over gambling expansion. That goes without question, and Poker Industry PRO sees the possibility of a backslide.

"Due to the handover in office that took place in January, it is unlikely the bill will take top priority despite Iden’s resolve to see it through," they wrote ($).

Those hoping for online poker in Michigan will have to return to the waiting game, it seems, a difficult turn after hopes soared with only one hurdle to clear before legalization.

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