Minnesota Bill to End Online Lottery Clears First Hurdle

MinnesotaA bill introduced by Representative Ann Lenczewski (DFL-Bloomington)in the Minnesota statehouse seeking to ban all forms of online gambling in the state has just cleared its first hurdle, receiving the go ahead from the Minnesota House Commerce Committee.

There is still a very long way to go in the process, with the Rules committee marking the next stop for the legislation, and then potentially to the House floor for markup and a potential vote. A companion bill (SF 2128) has also been introduced in the state senate by Rod Skoe (D-Clearbrook).

The Lenczewski bill (HF 2207) is meant to target online lottery sales in the state but could lead to a preemptive ban on all forms of online gambling in the state.

Online “Scratch-Off” cards are the point of contention

At odds is the recent addition of online scratch-off ticket sales (Minnesota has allowed residents to purchase lottery tickets online since 2010), which look and play an awful lot like online slot machines.

Despite the Minnesota Lottery enacting a $50 weekly limit per customer on online sales a number of activist groups and legislators are concerned with this potential expansion.

Jake Grassel, spokesman for Citizens Against Gambling Expansion was quoted by MPR News as saying, “Minnesota already has too much gambling.” Grassel then took up the current anti-online gambling rallying cry, declaring, “Internet expansion will mean we have a gambling facility in every home, library and Starbucks in the state.”

Representative Greg Davids (R-Preston) took it a step further, channeling his inner Spenser Bacchus, and calling online lottery sales, “online crack,” according to TwinCities.com. “This is addictive and this is going to destroy families,” Davids added.

Potential economic Impact

Thus far the online scratch cards have generated a meager $170,000 in revenue since they first became available on February 6, 2014, and estimates given to the House Commerce Committee indicate the proposed online lottery ban could cost the state $2.5 million per year.

Additionally, the Executive Director of the Minnesota Lottery Ed Van Petten said there could be “unknown ramifications” if online sales were abruptly terminated. According to Van Petten, roughly 8,500 Minnesotans have prepaid for their online lottery tickets, which allows them to simply go online and choose their numbers for each draw.

Van Petten wondered aloud what legal liability terminating these contracts could open the state up to.

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