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Sponsors of the tabled Minnesota sports betting bill expressed frustration at the recent legalisation of historical horse racing (HHR) terminals.

The Minnesota Racing Commission on Monday opted to legalise HHR at the state’s two racetracks, allowing each track up to 500 machines.

The Commission’s decision has complicated separate efforts to regulate online sports betting, with bill sponsors yesterday slamming the terminals as a “euphemism for slot machines”.

HHR, often termed instant racing, is a machine-based game that allows players to bet on replays of horse races using historic data.

The move has proved controversial statewide, drawing criticism from tribal interests, as well as the governor’s mansion and state legislators.

Rep. Zack Stephenson, the lead sponsor of the HB 2000 online sports betting bill in the House, sought to calm nerves around the controversial HHR legalisation.

The state representative said the sports betting bill had been amended to prohibit the activity.

“They’re not currently at the tracks and we did not believe they should be at the tracks notwithstanding certain racing commission actions the other night,” he said during a Wednesday informational session.

The representative went further, accusing the Commission’s actions of violating state laws.

“This is a clarification [that] historical horse racing in Minnesota is illegal,” he said. “That’s what the racing commission did last night.”

Latest twist for Minnesota sports betting

Stephenson’s bill, the latest attempt after last year’s effort stalled, has been amended in committee. The bill’s sponsors have touted the bipartisan nature of the current effort.

The previous 10% revenue tax has doubled to 20%, and the bill now includes new language to regulate Daily Fantasy Sports.

The distribution to good causes has also been reworked to better appeal to the Minnesotan legislature.

Racetracks would also receive $625,000 as part of a new economic development fund, Stephenson said.

However, the legislator fielded questions from representatives as to whether the bill could be improved.

In particular, the extent to which the state’s 11 tribes and two racetracks would benefit from the proposals dominated the conversation.

Under the bill’s text, all tribes would be permitted to partner with a sports betting operator. Tribal opposition has doomed previous legalisation attempts in the North Star State.

Rep. Anne Neu Brindley floated the idea of introducing a tribal profit-sharing aspect to the bill to ensure smaller tribes would be able to receive benefits from legalisation.

Brindley also questioned the value of the $625,000 racetrack fund, calling it “couch cushion money”.

“I really am tickled to hear Republicans concerned about income disparities,” shot back Stephenson on the tribal question.

“I will say that we’re talking about sovereign governments here, and it’s probably not appropriate for the state of Minnesota to be telling them what to do with their money.”

FanDuel-Draftkings duopoly highlighted

Stephenson further defended his proposals, arguing that there were enough venders on the market to partner with each of the state’s tribes.

However, Rep. Isaac Schultz  highlighted the US sports betting market’s current domination by FanDuel and DraftKings.  

“There are two or three vendors that carry 70% of the market share on this plus or minus, meaning, if a smaller tribe doesn’t have the ability to compete like a larger tribe, that quite honestly could mean that they don’t have the ability to create a meaningful benefit to their community,” he said.

At NEXT: New York, co-founding partner of Acies Investments Chris Grove argued in his State of the Union panel that the runaway success of certain operators could impede legislative efforts going forward, by limiting the pool of potential beneficiaries.

HB 2000, and the separate proposed sports betting legislation making its way through the Senate, now has just over a month until the 20 May end of the legislative session.

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