Apr 28, 2023 - Politics

Minnesota sports betting backers plan bill changes to give racetracks a slice of the revenue

Illustration of someone holding playing cards with different sports balls on them instead of suits.

Illustration: Maura Losch/Axios

Minnesota's horse racing industry would get a slice of the state's sports betting revenue under a planned amendment aimed at increasing the proposal's odds of passage.

Driving the news: DFL Sen. Matt Klein, the sponsor of the sports betting legislation, told Axios he's planning to introduce changes to the bill during a Senate hearing the first week of May.

State of play: A draft proposal unveiled in February would give Native American tribes exclusive rights to licenses needed to operate both brick-and-mortar and mobile betting.

  • Support from the tribes, pro sports teams, and key committee chairs in the House and Senate signaled momentum after years of failed efforts to add Minnesota to the growing list of states that currently allow wagering in some form.

Yes, but: The state's horse racing tracks, which want a part of the proposed system, were left out of the plan.

  • Lawmakers in both chambers whose votes would likely be needed to pass the bill say they want a deal that the tracks support.

What to expect: Klein told Axios that he plans to offer at next week's hearing "both monetary and policy provisions to make life better and business models more sustainable for the two tracks in Minnesota."

  • Proposed changes include routing 3% of profits generated from sports betting — about 30% of the cut the state would take in taxes — into an economic development fund for the tracks. Those transfers would be capped at $3 million.
  • Lawmakers would front-load the account with $20 million in state funds.

What we're hearing: Klein told Axios that the tribes remain "on board" with the changes, but the tracks have yet to take a public stance.

  • The Mendota Heights Democrat said that while the amendment is "our best effort to try to make this work," he's not sure if the bill can attract the GOP votes needed to pass the Senate without the tracks "vocally saying we support it."

What they're saying: When asked about the proposal, Running Aces Casino, Hotel and Racetrack president and chief executive Taro Ito told Axios that the company "remains committed to finding a sports betting solution that is fair and works for the state’s two racetracks and the Native American casinos."

  • He cited a 2022 poll showing a majority of Minnesotans support sports betting at both tribal casinos and tracks.
  • A spokesperson for Canterbury Park told Axios the venue could not comment on the idea because leaders had not seen the final amendment.

The intrigue: A similar proposed amendment, requested by Rep. Brad Tabke (DFL-Shakopee), was briefly posted on a House committee site in late February.

  • At the time, both Tabke, whose district includes Canterbury Park, and House sponsor Zack Stephenson told Axios that the draft was published in error and that talks among interested parties continued behind the scenes.

What we're watching: Even with the changes, it's unclear whether supporters can get the bill across the finish line with just over three weeks remaining in this year's session.


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