Important MN Notes
- Citizens can play at offshore poker rooms legally from MN
- Almost no movement to regulate online poker in the state
- Tribal casinos do offer brick n’ mortar poker options
- Limit Hold’em is extremely popular among citizens
- A move to block offshore iGaming sites failed in 2009
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“Reviewed by Chuck Humphrey – 50 year Gaming Law Practitioner”
Under Minnesota law gambling is considered illegal unless specifically exempted. Since online poker has not been exempted, it is illegal in the state to operate such business. Since Minnesota has not passed any laws legalizing online poker within their state, players can play legally at regulated offshore websites.
Future Outlook of Online Poker in Minnesota – Estimated date of legalization: 2020-2021
The following graph tracks our expected legislation of online poker in Minnesota on a state law level. It is currently already legal on a Federal level. This graph monitors the current rise or fall of expected legalization.
The Minnesota gambling survey [A] has included questions on Internet gambling since 1998. In 2012, 3.6% of Minnesota adults acknowledged that they had gambled online sometime in their lives. There is a fair amount of legal offline gambling available in Minnesota, and therefore, it is not surprising that Internet gambling is the least popular form of gambling in the state. As per the survey, two thirds of the Internet gamblers in Minnesota are male and half are under the age of 35.
The attitude of law enforcement agencies in Minnesota to online poker can be judged from a news item reported in MinnPost.com [B] in September 2009. The Minnesota Department of Public Safety’s Alcohol and Gambling Enforcement Division [C] requested 11 ISPs to block about 200 online gambling web sites. However, because of a lawsuit filed by the Interactive Media Entertainment and Gaming Association and mounting public pressure, the enforcement officials withdrew the request. Thereafter, there has been no report of any obstruction to Minnesota residents gambling at offshore online poker sites. At the same time, there has been no move to legalize online poker. This status quo is likely to continue in the foreseeable future.
Current Gambling Laws in Minnesota
The definition of gambling terms and penalties for illegal gambling can be found in Chapter 609 Criminal Code of the Minnesota Statutes. Section 609.75 [D] defines a “bet” as, “a bargain whereby the parties mutually agree to a gain or loss by one to the other of specified money, property or benefit dependent upon chance, although the chance is accompanied by some element of skill.”
According to this definition, three elements must be present for an activity to be considered gambling. The first element is chance, which implies that the outcome must be determined mostly, though not exclusively, by random means. The second element is prize, which means something of value must be won. The third element is consideration, which must be risked. The gambler must stand to lose something of value if he does not win. A sweepstakes or drawing in which anyone can enter at no cost is not gambling. However, if a purchase or entry fee is required then it becomes a bet. Specified exceptions include insurance, future sales of securities or commodities and bona fide contests of skill.
The forms of gambling that have been legalized are also specifically exempted. The regulation of these is covered by other chapters in the statutes. Chapter 240 includes laws relating to horse racing, Chapter 349 covers charitable gambling and Chapter 349A governs the state lottery. Chapter 299L establishes the Division of Alcohol and Gambling Enforcement in the Department of Public Safety. Minnesota Statutes do not cover the conduct of gambling on Indian reservations because these are the subject of separate compacts with the tribes as required under Federal law.
Except as provided elsewhere, Section 609.76 treats illegal gambling as gross misdemeanor and provides for a punishment of imprisonment for not more than one year or to payment of a fine of not more than $3,000, or both.
History of Gambling in Minnesota
Land Based Poker in Minnesota
Home poker falls under social bets under Minnesota law. These are further defined as private bets that are not part of, “organized, commercialized, or systematic gambling”. The Division of Alcohol and Gambling Enforcement interprets this provision to mean that, “the owner of the location of the social bet cannot derive any profit from the bet other than actual gambling winnings from participating. The owner should not organize regular occasions for such bets nor advertise their occurrence.”
Section 609.761 Subdivision 3 puts the following additional conditions – (i) no person under 18 years of age may participate; (ii) the payment of an entry fee or other consideration for participating is prohibited; (iii) the value of all prizes awarded to an individual winner of a tournament or contest at a single location may not exceed $200 each day; and (iv) the organizer or promoter must ensure that reasonable accommodations are made for players with disabilities.
The only types of gambling that may be conducted by nonprofit organizations are pull-tabs, bingo, paddlewheels, tipboards, and raffles. Nonprofits have also held card tournaments, including Texas Hold’em contests, under a state law limiting prizes and preventing direct benefit to the organization.
Live poker is permitted in a number of tribal casinos. Under the social gambling provision, businesses are permitted to conduct limited stakes card tournaments, including poker, providing that the business makes no direct profit from the game and that players do not pay an entry fee. The prizes are capped at $200 per tournament and a single player cannot win more than $200 a day at any one location. Live poker cash games and tournaments are also permitted at licensed card clubs attached to racetracks like Canterbury Park [E]. Section 240.30 [F] of the Minnesota Statutes deals with card clubs.
Gambling Laws in Minnesota
There are reasonable opportunities of legal gambling for Minnesota residents. These include gambling at tribal casinos, Minnesota State Lottery, charitable gambling, pari-mutuel horse racing, card clubs at race tracks and social gambling.
The only brick and mortar casinos that are permitted in Minnesota are tribal casinos on reservations. Private parties and the state cannot operate casinos. The 11 Native American tribes operate 18 casinos according to their individual compacts with the state. The complete list is available here [G].
These casinos offer Class I gaming, which encompasses traditional tribal games played for minimal prizes without any non-tribal regulation. Class II games that are subject to tribal regulation include bingo and similar games, “non-banked” card games such as poker and gaming machines in which players compete against each other for a common prize. Some casinos have compacts to offer Class III games that cover everything else, including traditional casino games like blackjack, slot machines, and pari-mutuel racing.
Pari-mutuel wagering on horse racing in Minnesota is currently limited to thoroughbred and quarter horse racing at Canterbury Park in Shakopee and harness racing at Running Aces in Columbus. Both tracks also offer wagering on races simulcast from tracks in other parts of the country. Chapter 240 of the Minnesota Statutes covers horse racing. Section 240.02 establishes a Racing Commission [H] for oversight of the activity.
The legislation specifically prohibits off-track betting and sets the minimum age for pari-mutuel betting at 18. The laws permit racing at county fairs, but this activity is not being undertaken. Both race tracks mentioned above operate licensed card clubs.
Casino cruises are not specifically permitted under Minnesota Statutes and are therefore deemed illegal, even though they are not specifically prohibited. However, casino cruises are offered from Afton on the St Croix River [I].
The laws for the state lottery are covered under Chapter 349A. The activities are regulated by the Minnesota State Lottery [J], which is an independent state agency. Both scratch games and lotto games are offered. Some of the popular products are Gopher 5, Hot Lotto, Northstar Cash, Daily 3 and Progressive Print. The nationwide Powerball and Mega Millions are available to Minnesota residents under an agreement with the Multi-State Lottery Association.
Chapter 349 of the Minnesota Statutes permits certain forms of gambling as charitable gambling to licensed organizations. In order to be eligible for a license an organization must make the following requirements: the organization must have been in existence for the most recent three years preceding the license application as a registered Minnesota non-profit corporation or as an organization designated as exempt from the payment of income taxes by the Internal Revenue Code; the organization must have at least 15 active members at the time of its initial license application and the organization must not be in existence solely for the purpose of conducting gambling. The permitted games include bingo, tip boards, pull tabs and raffles. Sections 349.211 and 349.2113 prescribe the prize limits, which are different for different types of gambling activities. Minnesota Gambling Control Board [K] has oversight of the activities.
Author: Joseph Falchetti (twitter)
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