Bill Seeks To Overturn Minnesota Racing Commission's Historical Horseracing Decision

April 9, 2024
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Decisions by the Minnesota Racing Commission to allow historical horseracing machines and electronic table games at the state’s two racetracks have garnered strong opposition from members of the state legislature who believe both rulemakings violate state gaming laws.
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Decisions by the Minnesota Racing Commission (MGC) to allow historical horseracing machines and electronic table games at the state’s two racetracks have garnered strong opposition from members of the state legislature who believe both rulemakings violate state gaming laws.

Representative Zack Stephenson, a member of the Democratic-Farmer-Labor Party, introduced an amended version of his bill, House File 5274, on Monday (April 8) to the House Commerce Finance and Policy Committee.

Vice chair DFL Representative Carlie Kotyza-Witthuhn said Stephenson’s bill will be referred to the House State and Local Government Finance Committee.

“There have been many misunderstandings about what this bill does or what it is attempting to do, so let me start out by clearly stating what we are trying to achieve with this bill,” Stephenson told the committee he chairs before then adjourning to vote on bills in the House.

The committee is scheduled to resume its hearing on HF 5274 on Tuesday.

“First, we want to reverse the racing commission’s decision last week and make clear that historical horse racing slot machines are not permitted at our state’s tracks,” Stephenson said. “Second we want to close a loophole in state law that allows for stadium-style card games.

“Third, we want to clarify the jurisdiction of the racing commission to make sure we don’t end up here in the future.”

Last week, the MGC voted 5-1 to permit Minnesota's two licensed racetracks, Canterbury Park and Running Aces, to offer historical horseracing, with up to 500 terminals at each location.

“I think these slot machines are not lawful at the tracks,” Stephenson said. “I think the racing commission took an unlawful action last week when they approved them, and this bill corrects it.”

Relations between supporters of mobile sports betting and the racetracks have been strained over DFL bills that would give the state’s tribal nations exclusive rights to partner with betting platforms to offer mobile wagering on sports.

Stephenson’s House File 2000 would give tribes exclusive rights to land-based and mobile sports betting and would also explicitly prohibit historical horseracing. Stephenson did clarify Monday that he plans to amend HF 2000 to remove the HHR ban in favor of moving forward to address the issue separately via HF 5274.

“Now let me be clear about what this bill is not intended to do,” he said. “It is not intended to change anything about actual horseracing in Minnesota. It is not intended to restrict the type of bets people can place on horseracing. It is not intended to stop or alter any kind of horseracing that is currently legal in Minnesota.”

“In fact,” Stephenson said, “this bill isn’t intended to do anything at all to real live horseracing.” He also cited a review by staff with the state’s Alcohol Gambling Enforcement Division that concluded HHR are slot machines, not pari-mutuel wagering, and are illegal under Minnesota law.

Stephenson added that his bill is not trying to prohibit any type of card game that is currently being played at card clubs at the tracks, aside from the stadium-style card games, also known as electronic table games.

Currently, card clubs are allowed a maximum of 80 tables, which was increased from 50 in 2012.

“The problem is, there is no definition of a table in state law,” Stephenson told the committee. 

He said traditional blackjack tables have a live dealer and seven players being dealt cards, but electronic table games allow for up to 33 hands to be dealt with digital images at any one time.

“The legislature wouldn’t have put a table limitation if it didn’t intend for it to mean something,” Stephenson said. “The racing commission shouldn’t render a statute meaningless. If we want to raise the number of tables at a card club, as we did in 2012, we should do it by statute not by an unelected commission.”

The racing commission approved the electronic table games with 11 player terminals, each of which can have 33 hands of cards being played at any one time. Stephenson noted that the total was more than four times the capacity of a traditional table, which allows for seven hands at a time.

“So, this bill corrects the overreach by the racing commission and attempts to clarify their jurisdiction, so we don’t end up in this mess again,” he said.

Stephenson said he believed it was time for the legislature to examine how gambling is regulated in Minnesota “because what we are doing right now isn’t working.” He listed the racing commission, several agencies, and the gaming control board that now oversees and regulates gambling in the state.

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