Minnesota to Pass on Sports Betting Legislation Again

With close to 40 states now allowing their residents to have access to sports betting resources, the pressure is mounting on non-participating states to move forward. That doesn't seem likely to happen in the state of Minnesota, and least not during the 2025 legislative year.

Word has just come down that no budgetary considerations have been included in the current budget for a study on the question of legalized sports betting. There were hopes that money would made available to hire an expert to evaluate and make recommendations on the pros and cons of legalized sports betting in the "land of 10,000 lakes."

The decision to not move forward on the sports betting question in 2025 is a source of frustration for leading advocate Sen. Matt Klein. He made his feelings known on May 8th when he told a Senate committee:

“I don’t think sports wagering is necessarily over this year, but the fact that we in the taxes committee cannot take a stand on a study to at least consider it and leave it before the thoughts of Minnesotans whom we represent is deeply disappointing.”

To him, it speaks volumes that the committee won't even request a study. It points to the notion there is a very deep-rooted resentment to allowing residents to legally bet on sports. It's the kind of resentment that could lead to avoidance of the issue over the next few years.

What's At Risk

Sen. Klein is quick to point out that the choice to ignore sports betting is costing the state tens of millions of dollars each year in tax revenue.

In A 2023 study from the Council for Fairer Gambling and YieldSec, the data showed that Minnesota residents had been wagering $2.4 billion annually on sports through as many as 860 illegal online betting operators. At a revenue hold rate of 8%, the gross taxable revenue each year would be $192,000,000. At a nationwide average tax rate of about 15%, the lost tax revenue would amount to $28,000,000 per year. If residents could wager legally at local casinos or online from the comforts of home, that number would likely be higher by a factor of 3x.

No Sports Betting is Hurting Tribal Communities

Minnesota is home to 11 federally recognized native Indian Tribes. Most if not all of these tribes are running retail casino operations on Indian land. While Tribes in some states oppose retail and online sports betting because of fear of revenue savaging, Sen. Klein believes the feeling is quite different among Minnesota's Tribal community.

These communities rely heavily on gambling operations to support the lives of their Tribe members. Klein believes that the legalization of online sports betting would greatly benefit Tribes as well as the state. He stated the feeling is:

"11 sovereign nations of this state who have declared to us this is their top priority and for whom these proceeds are essential for healthcare, education, housing, and the sustenance of their members.”

That raises the question of why so much resistance to this issue.