Michigan Edges Closer to Lifting Ban on Political Donations from Casinos

01/08/2020
News
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The decision by the Michigan House of Representatives to pass a bill that would allow casinos to make political donations is one which is shrouded in controversy.

In addition to lifting the ban on political contributions from casinos, Republican politician Brandt Iden’s legislation is part of a wider proposal that could change the gambling landscape in the state.

If approved by the Senate, the bill would legalise online fantasy sports contests, online gaming, sports wagering and advance-deposit betting in horse racing.

While the bill has proceeded to the next stage of the legislative process, there have been some dissenting voices in Michigan. Read on as we take a closer look at the latest state-of-play.

Michigan Casinos Set for Greater Political Powers

The legislation received widespread support from the House, with a final vote of 89-16 highlighting its popularity amongst members.

The 1996 Michigan Gaming Control and Revenue Act barred casinos and their employees from making any donations to political campaigns.

This was implemented to try to ensure that any decisions impacting the legislation surrounding the state’s gambling industry remained transparent.

After struggling to receive backing for his initial proposal, Iden managed to get support for the bill from Democratic Gov. Gretchen Whitmer’s administration after increasing gambling tax rates.

The Democrats were concerned that local projects would suffer from a decrease in revenue if brick-and-mortar casinos were impacted by the growth of online gambling.

The bill is also proposing to allow individuals convicted of a criminal offence to eventually be allowed to hold a casino license.

There would be a ten-year wait for people convicted of felonies, while misdemeanour convictions would require a five-year waiting period.

State Representative Hits Out at the Bill

The relationship between casinos and politics has long been a source of debate in the United States, with the legal position differing across the country.

While states like New Jersey and Pennsylvania do not allow casinos or their employees to make political contributions, other states such as Nevada take a more liberal view.

The city of Detroit and the Michigan Chamber of Commerce have backed Iden’s bill, while Detroit’s three casinos – MGM Grand, MotorCity and Greektown – are also supportive.

However, State Representative Bill Sowerby believes that if the bill passes the Senate it could have a detrimental impact on the state’s gaming industry.

“Millionaire and billionaire casino owners will now be allowed to give money to state legislators,” he told the Detroit News.

“Even worse, casino owners will no longer have to disclose to the public their past felony crime convictions, their financial failures – including bankruptcies – or their failures to pay their taxes.

“Michiganders expect and deserve more transparency and accountability from those who have such incredible responsibility, and this legislation severely diminishes that standard.”

Adelson Donations Highlight Michigan’s Conundrum

The US Supreme Court’s Citizens United decision in 2010 to remove the cap on sponsorship of political action campaigns (PACs) changed the face of politics in the US.

Sheldon Adelson, the world’s wealthiest casino owner, has contributed hundreds of millions of dollars to the Republican Party since then.

The billionaire and his wife, Miriam, were the largest Republican Party donors in the 2016 presidential election and repeated the trick two years later in the midterms.

They have delayed contributions to President Donald Trump’s re-election bid for 2020, but are fully expected to be amongst his biggest backers once again.

Trump also has other wealthy supporters from the gaming industry, including Phil Ruffin, Steve Wynn and Lorenzo and Frank Fertitta III.

However, many people believe that such donations help to corrupt democracy and by association have tarnished the respective industries of the donors.

While Iden’s proposal has made it to the Senate, it will be interesting to see if they will follow suit and rubber-stamp the bill.

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