SENATE BILL NO. 1194

A bill to amend 2019 PA 152, entitled

"Lawful internet gaming act,"

by amending sections 14 and 15 (MCL 432.314 and 432.315).

the people of the state of michigan enact:

Sec. 14. (1) Except for an internet gaming operator that is an Indian tribe, an internet gaming operator is subject to a graduated tax on the adjusted gross receipts received each calendar year by the internet gaming operator from all internet gaming it conducts under this act as set forth below:

(a) For adjusted gross receipts less than $4,000,000.00, a tax of 20%.21%.

(b) For adjusted gross receipts of $4,000,000.00 or more but less than $8,000,000.00, a tax of 22%.23%.

(c) For adjusted gross receipts of $8,000,000.00 or more but less than $10,000,000.00, a tax of 24%.25%.

(d) For adjusted gross receipts of $10,000,000.00 or more but less than $12,000,000.00, a tax of 26%.27%.

(e) For adjusted gross receipts of $12,000,000.00 or more, 28%.29%.

(2) An internet gaming operator that is an Indian tribe is subject to the payment requirements under section 7(1)(f).

(3) An internet gaming operator shall pay the tax or payment, as applicable, under subsection (1) or (2) on a monthly basis. The payment for each monthly accounting period is due on the tenth day of the following month.

(4) Except as provided in this act and section 12(17) of the Michigan Gaming Control and Revenue Act, 1996 IL 1, MCL 432.212, an internet gaming operator is not subject to any excise tax, license tax, privilege tax, occupation tax, or other tax, payment, or fee imposed exclusively on an internet gaming operator or internet gaming operators by this state or any political subdivision of this state, except as provided in this act. This subsection does not impair the contractual rights under an existing development agreement between a city and an internet gaming operator that holds a casino license under the Michigan Gaming Control and Revenue Act, 1996 IL 1, MCL 432.201 to 432.226.

(5) In addition to payment of the tax and other fees as provided in this act, and to any payment required pursuant to an existing development agreement described in subsection (4), if a city has imposed a municipal services fee equal to 1.25% on a casino licensee, the city shall charge a 1.25% fee on the adjusted gross receipts of an internet gaming operator that holds a casino license under the Michigan Gaming Control and Revenue Act, 1996 IL 1, MCL 432.201 to 432.226, whose casino is in that city.

Sec. 15. (1) The tax imposed under section 14 must be allocated as follows:

(a) Thirty percent to the city in which the internet gaming operator licensee's casino is located, for use in connection with the following:

(i) The hiring, training, and deployment of street patrol officers in that city.

(ii) Neighborhood development programs designed to create jobs in that city with a focus on blighted neighborhoods.

(iii) Public safety programs such as emergency medical services, fire department programs, and street lighting in that city.

(iv) Anti-gang and youth development programs in that city.

(v) Other programs that are designed to contribute to the improvement of the quality of life in that city.

(vi) Relief to the taxpayers of the city from 1 or more taxes or fees imposed by the city.

(vii) The costs of capital improvements in that city.

(viii) Road repairs and improvements in that city.

(b) Sixty-five Sixty-four point five percent to this state to be deposited in the fund.

(c) Five point five percent to the Michigan agriculture equine industry development fund created under section 20 of the horse racing law of 1995, 1995 PA 279, MCL 431.320. However, if the 5% 5.5% allocated under this subdivision to the Michigan agriculture equine industry development fund created under section 20 of the horse racing law of 1995, 1995 PA 279, MCL 431.320, exceeds $3,000,000.00 in a fiscal year, the amount in excess of $3,000,000.00 must be allocated and deposited in the fund created under section 16.

(2) By September 30, 2020 and each September 30 after that date, if the combined amount of money received in the preceding city fiscal year by the city in which the internet gaming operator's casino is located from money allocated under subsection (1)(a), from the wagering tax allocated under section 12 of the Michigan Gaming Control and Revenue Act, 1996 IL 1, MCL 432.212, from the wagering tax allocated under section 15 of the lawful sports betting act, 2019 PA 149, MCL 432.415, and all payments received under existing development agreements with internet gaming operators, is less than $183,000,000.00, the board shall distribute from the fund to the city in which the internet gaming operator's casino is located an amount equal to the difference between $183,000,000.00 and the combined amount of money the city in which the internet gaming operator's casino is located received in the preceding fiscal year from money allocated under subsection (1)(a), from the wagering tax allocated under section 12 of the Michigan Gaming Control and Revenue Act, 1996 IL 1, MCL 432.212, from the wagering tax allocated under section 15 of the lawful sports betting act, 2019 PA 149, MCL 432.415, and all payments received by the city under existing development agreements with internet gaming operators. The calculations set forth in this subsection must not include any payments made under section 14(5) or any payments made under section 13(1) of the Michigan Gaming Control and Revenue Act, 1996 IL 1, MCL 432.213, or any payments made under section 14(5) of the lawful sports betting act, 2019 PA 149, MCL 432.414. However, the total amount the city in which the internet gaming operator's casino is located receives for the preceding fiscal year under subsection (1)(a) and this subsection must not be more than 55% of the total received from the tax imposed under section 14 in the state fiscal year.