Liquor, sports betting bills receive bipartisan committee support

After three straight days of mostly party-line votes on omnibus bills, the House Ways and Means Committee crossed party lines Thursday around a pair of sometimes contentious subjects.

On bipartisan votes, the committee approved a bill to allow sports betting in the state, and the omnibus liquor bill.

Sports betting

On a 14-7 vote, the committee approved HF778, as amended, which would legalize sports betting in Minnesota for adults age 21 and older. Wagers would be allowed at brick-and-mortar locations on tribal lands or using a mobile app.

The aim is to displace an estimated $2 billion black market in Minnesota with a regulated, legal market, said Rep. Zack Stephenson (DFL-Coon Rapids), the bill sponsor. He noted most U.S. states, including those surrounding Minnesota, have legal ways to bet on sports. 

“This is an idea whose time has come,” he said.

Net revenue from online and mobile betting would be taxed at 10% with proceeds going into a special fund. From that, about $4 million would go to the Public Safety and Revenue departments for licensing and law enforcement.

The remainder would be split evenly between amateur youth sports and programs addressing problem gambling. 

Tax rates and licensing fees would be among the lowest in country as a deliberate choice, Stephenson said, as the goal is not to create a new General Fund revenue stream but ensure a regulated market with better consumer protections.

The companion, SF574, is sponsored by Sen. Roger Chamberlain (R-Lino Lakes) and awaits action by the Senate State Government Finance and Policy and Elections Committee.

Liquor bill

The omnibus liquor bill reflects a long set of compromises, said Stephenson, the sponsor of HF2767, and it would allow Minnesotans to enjoy craft brews and spirits they love while still protecting competition.

Because legislators, retailers, wholesalers and producers all had to compromise, no one is exactly thrilled with the final version, but “I am thrilled to have completed it,” Stephenson said.

Rep. Jim Nash (R-Waconia) said reaching a consensus bill has been a “long, long, long process.  … We have buy-in from all the interested parties.”

Approved 18-2, as amended, its next stop is the House Floor.

The amendment better reflects the cost of new hires for the Department of Public Safety’s Alcohol and Gambling Enforcement Division with appropriations of $568,000 this biennium and $882,000 the next.

To help some of the state’s most popular brewers, the bill would increase the annual production threshold to sell growlers from 20,000 barrels to 150,000 barrels.

A liquor regulation advisory council would be established to recommend proposals coming before the Legislature. Nash successfully offered three friendly amendments setting the council’s membership at 12 to include a representative each from farm wineries, a grocery retailer and another wholesaler.

Other provisions in the bill would:

• impose a tax on direct ship wineries and require them to obtain a license;
• allow distilleries of any size to operate a cocktail room;
• allow municipalities to issue on-sale wine and beer licenses for town ball games; and
• allow municipalities to issue a seven-day liquor license to county fairs and agriculture associations, rather than four days as is current law.

The companion, SF3008, is sponsored by Sen. Gary Dahms (R-Redwood Falls), and awaits action by the full Senate.