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Emily D. Swoboda

Minnesota Lawmaker Looks to Internet As Racing's Savior

2 June 2006

A Minnesota politician introduced a bill in March that would legalize off-track betting in the state and permit the state's racecourses to make wagering at their races available via the Internet.

Sponsored by House Gaming Division Chairman Rep. Andy Westerberg, R-Blaine, and co-sponsored by fellow Republicans Michael Beard, Mark Buesgens, Randy Demmer and Sondra Erickson, H.F. 3099 authorizes the Racing Commission to allow licensed U.S. entities conducting pari-mutuel betting to accept wagers electronically, within the confines of the law.

The legislation is built on the United States Code Title 15, Section 3001 (the Interstate Horseracing Act) which states:

The States should have the primary responsibility for determining what forms of gambling may legally take place within their borders; the Federal Government should prevent interference by one State with the gambling policies of another, and should act to protect identifiable national interests; and in the limited area of interstate off-track wagering on horse races there is a need for Federal action to ensure States will continue to cooperate with one another in the acceptance of legal interstate wagers. It is the policy of the Congress in this chapter to regulate interstate commerce with respect to wagering on horseracing, in order to further the horseracing and legal off-track betting industries in the United States.

The bill is receiving support from Canterbury Park in Shakopee, Minn. The track's simulcast handle fell by 8.3 percent (US$5.3 million) in 2005, which track officials have attributed to simulcast players opting to bet online. They say that if horse race wagering over the Internet were permitted in their state, they could compete against the offshore operators who return no percentage of their revenue to the sport.

To better compete with offshore operators, Canterbury Park implemented some changes this season intended to attract and retain live bettors. It now has roving mutuel tellers taking bets on the grounds, upgraded betting machines and more learning opportunities to help inexperienced horseplayers try to pick winners.

H.F. 3099 was presented for consideration on March 10 to the Gaming Division of the House Regulated Industries Committee. It was denied first on a tie vote. The bill was later reconsidered and referred to the full committee where it passed on a voice vote. It has not moved since, and Westerberg, who is not seeking reelection, does not feel it will before the conclusion of the session.

"I honestly don't expect it to pass this year," he told the St. Paul Pioneer Press.

Horse racing, meanwhile, remains at the center of debates in Washington over legislation to prohibit online gambling in the United States. Both of the House anti-Internet gambling bills--Rep. Bob Goodlatte's, R-Va., Internet Gambling Prohibition Act and Rep. James Leach's, R-Iowa, Unlawful Internet Gambling Enforcement Act--were passed May 25 by the U.S. House Judiciary Committee, but not without contention over language referring to horse racing.

Committee members argued last week over whether the Goodlatte bill provides an exemption for racing. Opponents say that his bill clearly leaves the door open for interstate race betting and criticize him for allowing one type of gambling online while banning all other types. But Goodlatte argues that the Justice Department should determine the legality of online interstate horse race betting under the terms of his bill and it has already declared Internet race betting illegal, despite the presumption that it is authorized by the Interstate Horseracing Act.

Leach's bill includes a carve-out for off-track betting services that use Internet technology to accept wagers, but his staff has said that this does not constitute an expansion of gambling.

Click here to view H.F. 3099.

Minnesota Lawmaker Looks to Internet As Racing's Savior is republished from
Emily D. Swoboda
Emily D. Swoboda