Bill Text: MI SB0203 | 2017-2018 | 99th Legislature | Introduced
Bill Title: Gaming; other; internet gaming; allow and regulate. Creates new act. TIE BAR WITH: SB 0204'17
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2017-03-09 - Referred To Committee Of The Whole [SB0203 Detail]
Download: Michigan-2017-SB0203-Introduced.html
SENATE BILL No. 203
March 1, 2017, Introduced by Senators KOWALL, JONES, WARREN, KNOLLENBERG, HERTEL and JOHNSON and referred to the Committee on Regulatory Reform.
A bill to create the lawful internet gaming act; to impose
requirements for persons to engage in internet gaming; to create
the division of internet gaming; to provide for the powers and
duties of the division of internet gaming and other state
governmental officers and entities; to impose fees; to impose a tax
on the conduct of licensed internet gaming; to create the internet
gaming fund; to prohibit certain acts in relation to internet
gaming and to prescribe penalties for those violations; to require
the promulgation of rules; and to provide remedies.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 1. This act shall be known and may be cited as the
"lawful internet gaming act".
Sec. 2. (1) The legislature finds that the internet has become
an integral part of everyday life for a significant number of
residents of this state, not only in regard to their professional
lives, but also in regard to personal business and communication.
Internet wagering on games of chance and games of skill is a core
form of entertainment for millions of individuals worldwide. In
multiple jurisdictions across the world, internet gaming is legal,
regulated, and taxed, generating billions of dollars in revenue for
governments.
(2) In an opinion dated September 20, 2011, the United States
Department of Justice reversed its previous interpretation of 18
USC 1084, commonly referred to as the federal wire act, allowing
states, subject to certain restrictions, to legalize and regulate
internet gaming and capture the revenue for the benefit of state
governments.
(3) In order to protect residents of this state who wager on
games of chance or skill through the internet and to capture
revenues and create jobs generated from internet gaming, it is in
the best interest of this state and its citizens to regulate this
activity by authorizing and establishing a secure, responsible,
fair, and legal system of internet gaming that complies with the
United States Department of Justice's September 2011 opinion
concerning 18 USC 1084.
(4) The legislature additionally finds that this act is
consistent and complies with the unlawful internet gambling
enforcement act of 2006, 31 USC 5361 to 5367, and specifically
authorizes use of the internet to place, receive, or otherwise
knowingly transmit a bet or wager if that use complies with this
act and rules promulgated under this act.
Sec. 3. As used in this act:
(a) "Authorized participant" means an individual who has a
valid internet wagering account with an internet gaming licensee
and is at least 21 years of age.
(b) "Board" means the Michigan gaming control board created
under section 4 of the Michigan gaming control and revenue act,
1996 IL 1, MCL 432.204.
(c) "Casino" means a building or buildings in which gaming is
lawfully conducted under the Michigan gaming control and revenue
act, 1996 IL 1, MCL 432.201 to MCL 432.226, or in which class III
gaming is lawfully conducted by an Indian tribe under a facility
license issued in accordance with a tribal gaming ordinance
approved by the chair of the National Indian Gaming Commission.
(d) "Division" means the division of internet gaming
established under section 5.
(e) "Fund" means the internet gaming fund created under
section 15.
(f) "Gross gaming revenue" means the total of all internet
wagers actually received by an internet gaming licensee licensed by
the division, less the total of all winnings paid out to authorized
participants. As used in this subdivision:
(i) "Prizes" includes both monetary and nonmonetary prizes
received directly or indirectly by an authorized participant from
an internet gaming licensee licensed by the division as a direct or
indirect result of placing an internet wager. The value of a
nonmonetary prize is the actual cost of the prize.
(ii) "Winnings" includes all of the following:
(A) The total amount authorized participants receive as prizes
during the accounting period.
(B) Stakes returned to authorized participants.
(C) Other amounts credited to authorized participants'
accounts, including the monetary value of loyalty points, free
play, and other similar complimentaries and incentives granted to
authorized participants as a result of participation in internet
games.
(g) "Institutional investor" means a person that is any of the
following:
(i) A retirement fund administered by a public agency for the
exclusive benefit of federal, state, or local public employees.
(ii) An employee benefit plan or pension fund that is subject
to the employee retirement income security act of 1974, Public Law
93-406.
(iii) An investment company registered under the investment
company act of 1940, 15 USC 80a-1 to 80a-64.
(iv) A collective investment trust organized by a bank under
12 CFR part 9.
(v) A closed end investment trust.
(vi) A chartered or licensed life insurance company or
property and casualty insurance company.
(vii) A chartered or licensed financial institution.
(viii) An investment advisor registered under the investment
advisers act of 1940, 15 USC 80b-1 to 80b-21.
(ix) Any other person that the division determines should be
considered to be an institutional investor for reasons consistent
with this act.
(h) "Internet" means the international computer network of
interoperable packet-switched data networks, inclusive of such
additional technological platforms as mobile, satellite, and other
electronic distribution channels approved by the division.
(i) "Internet game" means a game of skill or chance that is
offered for play through the internet in which a person wagers
money or something of monetary value for the opportunity to win
money or something of monetary value. For purposes of this
definition, free plays or extended playing time that is won on a
game of skill or chance that is offered through the internet is not
something of monetary value. Internet game includes gaming
tournaments conducted via the internet in which persons compete
against one another in 1 or more of the games authorized by the
division or in approved variations or composites as authorized by
the division.
(j) "Internet gaming" means operating, conducting, or offering
for play an internet game.
(k) "Internet gaming licensee" means a person that is issued
an internet gaming license from the division to conduct internet
gaming or is otherwise authorized to conduct internet gaming under
section 7.
(l) "Internet gaming platform" means an integrated system of
hardware, software, and servers through which an internet gaming
licensee conducts internet gaming under this act.
(m) "Internet gaming vendor" means a person that provides to
an internet gaming licensee goods, software, or services that
directly affect the wagering, play, and results of internet games
authorized, conducted, and played under this act, including goods,
software, or services necessary to the acceptance, operation,
administration, or control of internet wagers, internet games,
internet wagering accounts, or internet gaming platforms. Internet
gaming vendor does not include a person that provides to an
internet gaming licensee only such goods, software, or services
that it also provides to others for purposes not involving internet
gaming, including, but not limited to, a payment processor or a
geolocation service provider.
(n) "Internet wager" means money or something of monetary
value risked on an internet game authorized by this act.
(o) "Internet wagering" means risking money or something of
monetary value on an internet game authorized by this act.
(p) "Internet wagering account" means an electronic ledger in
which all of the following types of transactions relative to the
internet gaming platform are recorded:
(i) Deposits.
(ii) Withdrawals.
(iii) Amounts wagered.
(iv) Amounts paid on winning wagers.
(v) Service or other transaction-related charges authorized by
the authorized participant, if any.
(vi) Adjustments to the account.
(q) "Person" means an individual, partnership, corporation,
association, limited liability company, federally recognized Indian
tribe, or other legal entity.
Sec. 4. (1) Internet gaming may be conducted only to the
extent that it is conducted in accordance with this act. A law that
is inconsistent with this act does not apply to internet gaming as
provided for by this act. This act does not apply to lottery games
offered by the bureau of state lottery.
(2) An internet wager received by an internet gaming licensee
is considered to be gambling or gaming that is conducted in the
licensee's casino located in this state, regardless of the
authorized participant's location at the time the participant
places the internet wager.
(3) Only an internet gaming licensee at its casino may
aggregate computers or other internet access devices in order to
enable multiple players to simultaneously play an internet game.
Except as provided in this subsection, a person shall not aggregate
computers or other internet access devices in a place of public
accommodation in this state, including a club or other association,
in order to enable multiple players to simultaneously play an
internet game.
Sec. 5. (1) The division of internet gaming is established in
the board. The division has the powers and duties specified in this
act and all other powers necessary to enable it to fully and
effectively execute this act to administer, regulate, and enforce
the system of internet gaming established by this act.
(2) The division has jurisdiction over every person licensed
by the division and may take enforcement action as provided in
section 9(2) against a person that is not licensed by the division
that offers internet gaming in this state.
(3) The division may enter into agreements with other
jurisdictions to facilitate, administer, and regulate
multijurisdictional internet gaming by internet gaming licensees
licensed by the division to the extent that entering into the
agreement is consistent with state and federal laws and if the
gaming under the agreement is conducted only in the United States.
(4) The division shall not authorize, administer, or otherwise
license a person to conduct internet wagering on any amateur or
professional sporting event or contest, unless doing so is
consistent with state and federal laws.
(5) For purposes of this act, the intermediate routing of
electronic data in connection with internet wagering, including
routing across state lines, does not determine the location or
locations in which the wager is initiated, received, or otherwise
made.
Sec. 6. (1) The division may issue an internet gaming license
to a person that applies for the license if the division determines
that the applicant is eligible for an internet gaming license under
this act and the rules promulgated under this act. If the applicant
holds a casino license under the Michigan gaming control and
revenue act, 1996 IL 1, MCL 432.201 to 432.226, the division shall
consider the applicant to be eligible for an internet gaming
license under this act, and the division shall issue an internet
gaming license to the applicant after receiving the application and
the application fee if the division determines that the internet
gaming proposed by the applicant complies with this act.
(2) An internet gaming license issued under this act is valid
for the 5-year period after the date of issuance and, if the
division determines that the licensee continues to meet the
eligibility standards under this act, is renewable for additional
5-year periods.
(3) The division shall only issue an internet gaming license
to a person that is 1 of the following:
(a) A casino licensee under the Michigan gaming control and
revenue act, 1996 IL 1, MCL 432.201 to 432.226.
(b) A federally recognized Michigan Indian tribe that operates
a casino in this state in which class III gaming other than
internet gaming is conducted under a facility license issued in
accordance with a tribal gaming ordinance approved by the chair of
the National Indian Gaming Commission. The division shall not issue
an internet gaming license unless the Indian tribe, in connection
with its application to conduct internet gaming under this act,
waives its sovereign immunity with respect to conducting internet
gaming under this act, including, but not limited to, obtaining
licensure and subjecting itself to enforcement by the division in
state and federal courts and paying fees and taxes imposed under
this act.
(4) A qualified applicant may apply to the division for an
internet gaming license to offer internet gaming as provided in
this act. The application must be made on forms provided by the
division and contain the information required by the division,
including, but not limited to, detailed information regarding the
ownership and management of the applicant, detailed personal
information regarding the applicant, financial information
regarding the applicant, and the gaming history and experience of
the applicant in the United States and other jurisdictions.
However, if the applicant holds a casino license under the Michigan
gaming control and revenue act, 1996 IL 1, MCL 432.201 to 432.226,
the applicant need not provide any information that it has
previously provided to the division unless notified by the division
that the information cannot be located.
(5) An initial application for an internet gaming license must
be accompanied by an application fee of $100,000.00. The rules
promulgated under section 10 may include provisions for the refund
of an application fee, or the portion of an application fee that
has not been expended by the division in processing the
application, and the circumstances under which the fee will be
refunded.
(6) The division shall keep all information, records,
interviews, reports, statements, memoranda, or other data supplied
to or used by the division in the course of its review or
investigation of an application for an internet gaming license or a
renewal of an internet gaming license strictly confidential and
shall use that material only to evaluate the applicant for an
internet gaming license for the license or renewal. The materials
described in this subsection are exempt from disclosure under
section 13 of the freedom of information act, 1976 PA 442, MCL
15.243.
(7) An application under this section must be submitted and
considered in accordance with this act and any rules promulgated
under this act.
(8) An institutional investor that holds for investment
purposes only less than 30% of the equity of an applicant under
this section is exempt from the licensure requirements of this act.
(9) An internet gaming licensee licensed by the division shall
pay a license fee of $200,000.00 to the division at the time the
initial license is issued and $100,000.00 each year after the
initial license is issued. The division shall deposit all
application and license fees paid under this act into the fund.
Sec. 7. (1) A federally recognized Michigan Indian tribe that
operates a casino in this state in which class III gaming other
than internet gaming is conducted under a facility license issued
in accordance with a tribal gaming ordinance approved by the chair
of the National Indian Gaming Commission may conduct internet
gaming on the same basis as any internet gaming licensee licensed
by the division, only if either of the following applies:
(a) The Indian tribe holds an internet gaming license under
this act.
(b) The Indian tribe has entered into a compact with this
state under the Indian gaming regulatory act, Public Law 100-497,
or an amendment to such a compact, that has, to the extent required
by the compact, been approved by the legislature, and that meets
all of the following requirements:
(i) The compact or amendment specifically authorizes the tribe
to conduct internet gaming to the same extent as an internet gaming
licensee licensed by the division under this act may, but subject
to all of the following:
(A) The terms of the compact and any amendments to the compact
relating to internet gaming.
(B) The Indian gaming regulatory act, Public Law 100-497.
(C) The unlawful internet gambling enforcement act of 2006, 31
USC 5361 to 5367.
(D) Any other applicable state and federal laws.
(ii) The compact or amendment has been approved by the
applicable federal agencies as required by the Indian gaming
regulatory act, Public Law 100-497.
(iii) The compact or amendment includes provisions addressing
all of the following:
(A) The amount and manner of revenue sharing to be paid to
this state by the Indian tribe related to internet gaming.
(B) A dispute resolution process, which must include a limited
waiver of sovereign immunity, to provide this state with legal and
equitable remedies enforceable in state and federal courts to
enforce the tribe's agreement to make revenue sharing payments to
this state related to internet gaming. If an Indian tribe fails to
comply with the requirements set forth in its compact or amendment
with respect to the revenue sharing payments to be made to this
state related to internet gaming, the tribe is no longer eligible
to be an internet gaming licensee and shall cease all internet
gaming operations.
(C) The types of internet games to be offered. The compact or
amendment must provide that the Indian tribe may only offer games
that are authorized by the division.
(D) Responsible gaming.
(E) Technical and financial standards for internet wagering,
internet wagering accounts, and internet gaming platforms, systems
and software, and other electronic components for internet gaming.
(F) One or more mechanisms designed to reasonably verify that
an individual who desires to place a wager over the internet gaming
platform used by the Indian tribe is 21 years of age or older.
(iv) The compact or amendment includes all of the following:
(A) A requirement that an individual who desires to place a
wager over the internet gaming platform used by the Indian tribe
must first satisfy the verification requirements required under
sub-subparagraph (B) to establish an internet gaming account or
make an internet wager.
(B) A requirement that the internet gaming platform used by
the Indian tribe include verification mechanisms designed to detect
and prevent the unauthorized use of internet wagering accounts and
to detect and prevent fraud, money laundering, and collusion, and
that the internet gaming platform provider, if not tribally owned,
be licensed as an internet gaming vendor under this act.
(C) A provision stating that if a court enters a judgment or
order that has the effect of invalidating or otherwise rendering
inoperative section 6(3)(a), which authorizes the division to issue
an internet gaming license to a casino licensee under the Michigan
gaming control and revenue act, 1996 IL 1, MCL 432.201 to 432.226,
the compact or amendment, to the extent that it authorizes internet
gaming by the Indian tribe, is inoperable and of no effect.
(D) A provision providing that eligibility to conduct internet
gaming is conditioned on the tribe's continuous operation of its
casino under a facility license issued in accordance with a tribal
gaming ordinance approved by the chair of the National Indian
Gaming Commission.
(2) This section does not limit the additional terms that this
state and an Indian tribe may negotiate and include in a compact or
amendment to a compact under the Indian gaming regulatory act,
Public Law 100-497.
Sec. 8. (1) The division may issue an internet gaming vendor
license to a person to provide goods, software, or services to
internet gaming licensees. A person that is not licensed under this
section shall not provide goods, software, or services as an
internet gaming vendor to an internet gaming licensee.
(2) On application by an interested person, the division may
issue a provisional internet gaming vendor license to an applicant
for an internet gaming vendor license. A provisional license issued
under this subsection allows the applicant for the internet gaming
vendor license to conduct business with an internet gaming licensee
or applicant for an internet gaming license before the internet
gaming vendor license is issued to the applicant. A provisional
license issued under this subsection expires on the date provided
in the license by the division.
(3) An internet gaming vendor license issued under subsection
(1) is valid for the 5-year period after the date of issuance. An
internet gaming vendor license is renewable after the initial 5-
year period for additional 5-year periods if the division
determines that the internet gaming vendor continues to meet the
eligibility standards under this act.
(4) A person may apply to the division to become an internet
gaming vendor licensee as provided in this act and the rules
promulgated under this act.
(5) An application under this section must be made on forms
provided by the division and contain any information required by
the division, including, but not limited to, detailed information
regarding the ownership and management of the applicant, detailed
personal information regarding the applicant, financial information
regarding the applicant, and the gaming history and experience of
the applicant. However, if the applicant is licensed as a supplier
under the Michigan gaming control and revenue act, 1996 IL 1, MCL
432.201 to 432.226, the applicant need not provide any information
that it has previously provided to the division unless notified by
the division that the information cannot be located.
(6) An application under this section must be accompanied by a
nonrefundable application fee in an amount to be determined by the
division, not to exceed $5,000.00.
(7) The division shall keep all information, records,
interviews, reports, statements, memoranda, or other data supplied
to or used by the division in the course of its review or
investigation of an application for licensure as an internet gaming
vendor strictly confidential and use the materials only to evaluate
an applicant for licensure. The materials described in this
subsection are exempt from disclosure under section 13 of the
freedom of information act, 1976 PA 442, MCL 15.243.
(8) An internet gaming vendor shall pay a license fee of
$5,000.00 to the division at the time an initial license is issued
to the vendor and $2,500.00 each year after the initial license is
issued. An internet gaming platform provider shall pay a license
fee of $100,000.00 to the division at the time the initial license
is issued to the provider and $50,000.00 each year after the
initial license is issued.
(9) The division shall deposit all application and license
fees paid under this act into the fund.
Sec. 9. (1) Except for internet gaming conducted by an Indian
tribe under section 7(1)(b), the division has jurisdiction over and
shall supervise all internet gaming operations governed by this
act. The division may do anything necessary or desirable to
effectuate this act, including, but not limited to, all of the
following:
(a) Develop qualifications, standards, and procedures for
approval and licensure by the division of internet gaming licensees
and internet gaming vendors.
(b) Decide promptly and in reasonable order all license
applications and approve, deny, suspend, revoke, restrict, or
refuse to renew internet gaming and internet gaming vendor
licenses. A party aggrieved by an action of the division denying,
suspending, revoking, restricting, or refusing to renew a license
may request a contested case hearing before the division. A request
for hearing under this subdivision must be made to the division in
writing within 21 days after service of notice of the action by the
division.
(c) Conduct all hearings pertaining to violations of this act
or rules promulgated under this act.
(d) Provide for the establishment and collection of all
license fees and taxes imposed by this act and the rules
promulgated under this act and the deposit of the fees and taxes
into the fund.
(e) Develop and enforce testing and auditing requirements for
internet gaming platforms, internet wagering, and internet wagering
accounts.
(f) Develop and enforce requirements for responsible gaming
and player protection, including privacy and confidentiality
standards and duties.
(g) Develop and enforce requirements for accepting internet
wagers.
(h) Adopt by rule a code of conduct governing division
employees that ensures, to the maximum extent possible, that
persons subject to this act avoid situations, relationships, or
associations that may represent or lead to an actual or perceived
conflict of interest.
(i) Develop and administer civil fines for internet gaming
licensees licensed by the division and internet gaming vendor
licensees that violate this act or the rules promulgated under this
act. A fine imposed under this subdivision must not exceed
$5,000.00 per violation.
(j) Audit and inspect, on reasonable notice, books and records
relevant to internet gaming operations, internet wagers, internet
wagering accounts, internet games, or internet gaming platforms,
including, but not limited to, the books and records regarding
financing and accounting materials held by or in the custody of an
internet gaming licensee or internet gaming vendor licensee.
(k) Acquire or lease real property and make improvements to
the property and acquire by lease or by purchase personal property,
including, but not limited to, any of the following:
(i) Computer hardware.
(ii) Mechanical, electronic, and online equipment and
terminals.
(iii) Intangible property, including, but not limited to,
computer programs, software, and systems.
(2) The division may investigate, issue cease and desist
orders, and obtain injunctive relief against a person that is not
licensed by the division that offers internet gaming in this state.
(3) The division shall keep all information, records,
interviews, reports, statements, memoranda, and other data supplied
to or used by the division in the course of any investigation of a
person licensed under this act strictly confidential and shall use
that material only for investigative purposes. The materials
described in this subsection are exempt from disclosure under
section 13 of the freedom of information act, 1976 PA 442, MCL
15.243.
Sec. 10. The division shall promulgate rules governing the
licensing, administration, and conduct of internet gaming necessary
to carry out this act within 1 year after the effective date of
this act. A person shall not conduct internet gaming under this act
until 150 days after the division promulgates the rules and the
rules take effect. The promulgation of emergency rules does not
satisfy the requirement for the promulgation of rules to allow a
person to conduct internet gaming under this act. The division
shall promulgate the rules pursuant to the administrative
procedures act of 1969, 1969 PA 306, MCL 24.201 to 24.328. The
rules may include only things expressly authorized by this act,
including all of the following:
(a) The types of internet games to be offered, which must
include, but need not be limited to, poker.
(b) The qualifications, standards, and procedures for approval
and licensure by the division of internet gaming licensees and
internet gaming vendor licensees consistent with this act.
(c) Requirements to ensure responsible gaming.
(d) Technical and financial standards for internet wagering,
internet wagering accounts, and internet gaming platforms, systems,
and software or other electronic components for internet gaming.
(e) Procedures for conducting contested case hearings under
this act.
(f) Procedures and requirements for the acceptance, by an
internet gaming licensee licensed by the division, of internet
wagers initiated or otherwise made by persons located in other
jurisdictions.
(g) Requirements for multijurisdictional agreements entered
into by the division with other jurisdictions, including
qualifications, standards, and procedures for approval by the
division of vendors providing internet gaming platforms in
connection with the agreements.
Sec. 11. (1) An internet gaming licensee licensed by the
division must provide 1 or more mechanisms on the internet gaming
platform that the licensee uses that are designed to reasonably
verify that an authorized participant is 21 years of age or older
and that internet wagering is limited to transactions that are
initiated and received or otherwise made by an authorized
participant located in this state or a jurisdiction in the United
States in which internet gaming is legal.
(2) An individual who wishes to place an internet wager under
this act must satisfy the verification requirements under
subsection (1) before he or she may establish an internet gaming
account or make an internet wager on an internet game offered by an
internet gaming licensee licensed by the division.
(3) An internet gaming licensee licensed by the division shall
include mechanisms on the internet gaming platform the licensee
uses that are designed to detect and prevent the unauthorized use
of internet wagering accounts and to detect and prevent fraud,
money laundering, and collusion.
(4) An internet gaming licensee licensed by the division shall
not knowingly authorize any of the following individuals to
establish an internet gaming account or knowingly allow them to
wager on internet games offered by the internet gaming licensee,
except if required and authorized by the division for testing
purposes or to otherwise fulfill the purposes of this act:
(a) An individual who is less than 21 years old.
(b) An individual whose name appears in the division's
responsible gaming database.
Sec. 12. (1) The division may develop responsible gaming
measures, including a statewide responsible gaming database
identifying individuals who are prohibited from establishing an
internet wagering account or participating in internet gaming
offered by an internet gaming licensee licensed by the division.
The executive director of the board may place an individual's name
in the responsible gaming database if any of the following apply:
(a) The individual has been convicted in any jurisdiction of a
felony, a crime of moral turpitude, or a crime involving gaming.
(b) The individual has violated this act or another gaming-
related law.
(c) The individual has performed an act or has a notorious or
unsavory reputation such that the individual's participation in
internet gaming under this act would adversely affect public
confidence and trust in internet gaming.
(d) The individual's name is on a valid and current exclusion
list maintained by this state or another jurisdiction in the United
States.
(2) The division may promulgate rules for the establishment
and maintenance of the responsible gaming database.
(3) An internet gaming licensee, in a format specified by the
division, may provide the division with names of individuals to be
included in the responsible gaming database.
(4) An internet gaming licensee licensed by the division
shall, on the internet gaming platform used by the licensee,
display in a clear, conspicuous, and accessible manner the number
of the toll-free compulsive gambling hotline maintained by this
state and offer responsible gambling services and technical
controls to participants, consisting of both temporary and
permanent self-exclusion for all internet games offered and the
ability for participants to establish their own periodic deposit
and internet wagering limits and maximum playing times.
(5) An authorized participant may voluntarily prohibit himself
or herself from establishing an internet wagering account with an
internet gaming licensee licensed by the division. The division may
incorporate the voluntary self-exclusion list into the responsible
gaming database and maintain both the self-exclusion list and the
responsible gaming database in a confidential manner.
(6) The self-exclusion list and responsible gaming database
established under this section are exempt from disclosure under
section 13 of the freedom of information act, 1976 PA 442, MCL
15.243.
Sec. 13. (1) A person shall not do any of the following:
(a) Offer internet gaming for play in this state if the person
is not an internet gaming licensee.
(b) Knowingly make a false statement on an application for a
license to be issued under this act.
(c) Knowingly provide false testimony to the board or an
authorized representative of the board while under oath.
(2) A person that violates subsection (1) is guilty of a
felony punishable by imprisonment for not more than 10 years or a
fine of not more than $100,000.00, or both.
(3) The division shall not issue a license under this act to a
person that violates subsection (1).
(4) The attorney general or a county prosecuting attorney
shall bring an action to prosecute a violation of subsection (1),
in the attorney general's or prosecuting attorney's discretion, in
the county in which the violation occurred or in Ingham County.
Sec. 14. (1) A person that receives an internet gaming license
from the division is subject to a tax of 10% on the gross gaming
revenue received by the internet gaming licensee from internet
gaming conducted under this act.
(2) An internet gaming licensee that is subject to subsection
(1) shall pay the tax under subsection (1) on a monthly basis. The
payment for a month is due on the tenth day of the following month.
(3) If, as provided in a compact, amendment to a compact, or
other agreement negotiated with this state, a person is able to
lawfully conduct internet gaming in this state for a period of time
subject to payment of a revenue share or other payment to this
state that is lower than the tax rate imposed under subsection (1),
the tax rate under subsection (1) is automatically reduced to a
rate equivalent, as determined by the board, to the rate paid as a
revenue share or other payment under the compact, amendment to a
compact, or other agreement with this state during that period of
time. If this state enters into compacts, amendments to compacts,
or agreements described in this subsection with more than 1 person,
the tax rate under this section is reduced to the rate in the
compact, amendment to a compact, or agreement with the lowest rate.
For all calculations under this subsection, if there is more than 1
rate paid under a compact, amendment to a compact, or agreement,
the rate to be applied is the highest rate in the compact,
amendment to a compact, or agreement in effect during the
applicable time period.
Sec. 15. (1) The internet gaming fund is created in the state
treasury.
(2) The state treasurer may receive money or other assets
required to be paid into the fund under this act or from any other
source for deposit into the fund. The state treasurer shall direct
the investment of the fund. The state treasurer shall credit to the
fund interest and earnings from fund investments.
(3) Money in the fund at the close of the fiscal year must
remain in the fund and not lapse to the general fund.
(4) The board is the administrator of the fund for auditing
purposes.
(5) The board shall expend money from the fund, on
appropriation, for all of the following:
(a) Each year, $5,000,000.00 to the first responder presumed
coverage fund created in section 405 of the worker's disability
compensation act of 1969, 1969 PA 317, MCL 418.405.
(b) The board's costs of regulating and enforcing internet
gaming under this act.
Sec. 16. (1) If a court enters a final judgment or order that
has the effect of invalidating or otherwise rendering inoperative
section 6(3)(a), which authorizes the division to issue an internet
gaming license to a person that holds a casino license under the
Michigan gaming control and revenue act, 1996 IL 1, MCL 432.201 to
432.226, this entire act is inoperable and of no effect.
(2) If a court holds that a provision of this act, or the
application of a provision of this act to any person or
circumstance, is invalid other than as provided in subsection (1),
the validity of the remainder of this act and the application of
the remainder of this act to other persons and circumstances are
not affected, as provided in section 5 of 1846 RS 1, MCL 8.5.
Enacting section 1. This act takes effect 90 days after the
date it is enacted into law.
Enacting section 2. This act does not take effect unless
Senate Bill No. 204
of the 99th Legislature is enacted into law.