The National Council of Legislators from Gaming States released a draft Model Internet Gaming Act for public comment

The National Council of Legislators from Gaming States (NCLGS) has released the long-awaited draft of its Model Internet Gaming Act (MIGA) and is seeking public comment.

The purpose of MIGA is to serve as a blueprint for state legislators hoping to legalize online casino gaming in coming years. In principle, it could speed up the process, increase those efforts’ chances of success, and produce a national landscape with more regulatory consistency between states.

NCLGS President and West Virginia Del. Shawn Fluharty explained that purpose in greater detail to PlayUSA:

As a legislator, I fully understand the complexities of getting legislation across the finish line. I also understand the benefits of a regulated iGaming market – one that protects the consumer, raises new revenue without raising taxes and helps shrink the black market. My hope is that by bringing together regulators, legislators and industry stakeholders to provide their expertise for this model legislation, it will be a catalyst in producing public policy that will benefit states for generations to come.

West Virginia Del. Shawn Fluharty, speaking to PlayUSA

Legislators and industry stakeholders will discuss the model Dec. 14 at the NCLGS winter meeting in New Orleans. However, a NCLGS representative told PlayUSA that the organization won’t vote to adopt the model immediately. Although that was the original plan, it required that the legislation be released 30 days ahead of the meeting. The actual release date has not left quite enough time for the public comment period.

Instead, NCLGS will vote on the model early in 2025, following a public comment period ending Dec. 31. However, the draft model can still be used by legislators looking to file an iGaming bill in the new year.

NCLGS statement of policy

Fluharty announced the planned iGaming model legislation to PlayUSA last January ahead of the NCLGS meeting in Fort Lauderdale. Originally, the plan was to reveal the language at the summer meeting in Pittsburgh last July.

However, taking recommendations from stakeholders and turning them into a concise model proved difficult, with the first attempt coming in over 100 pages. NCLGS held further discussions in Pittsburgh and pushed back the final product to this next meeting in New Orleans.

This way, it can still influence iGaming legislation filed in 2025.

The model includes this statement of policy:

NCLGS proposes the following Internet Gaming Act to serve as model legislation establishing legislative and regulatory standards for implementing internet gaming at the state level. In crafting this document, we fully realize that each state has a unique gaming sector with disparate interests and concerns. Nonetheless, we believe the regulatory framework set forth herein may be a useful tool for consideration as states embrace the vast potential of internet gaming.

NCLGS Model Internet Gaming Act

Three of the key fundamental principals included by NCLGS:

• It is in the state’s interest that the implentation of iGaming compliments, and does not adversely impact, licensed casinos and racinos in the state.
• It is in the public’s interest that implementation and administration of iGaming be strictly regulated. The state’s objective is to attain public confidence while shrinking illegal gambling activities and increasing new revenue to the state, requiring a comprehensive licensing structure.
• Any form of internet gaming conducted without approval of the gaming regulatory authority shall be illegal and subject to sanctions.

Tax rate, fee and licensing recommendations

NCLGS recommends a tax range between 15% and 25% for online casino. This is less than the tax rates considered by key states this year. The Maryland Senate passed a bill with a 55% tax rate on digital games (20% live dealers). And New York considered legislation with a 30.5% tax rate.

Throwing out the 36% iGaming tax rate instituted by Pennsylvania, NCLGS notes that the average tax rate of the other six states with legal online casino is 19%.

According to the draft, “a competitive tax rate also allows competitive technological growth without creating a barrier of entry for future market participation.”

NCLGS Model Internet Gaming Act

Given that states vary so much in size and population, NCLGS did not propose a maximum number of operators or standard fee for an online casino license. However, the model does suggest that iGaming licenses last for a period of five years.

The model makes the following suggestions regarding licenses:

• Separate licenses and fees for iGaming operators, platforms and suppliers.
• The gaming authority shall issue an iGaming license to any holder of a land-based casino license that meets the requirements.
• A state may establish a competitive bidding process for a finite number of iGaming licenses.
• The state may limit internet gaming operators to existing licensed casinos, racinos and sports betting operators.
• The state shall establish a maximum number of internet gaming skins.
• Regulators may issue temporary licenses to operators in good standing to conduct internet gaming in anoter state.

Recommended responsible gaming requirements

The federal SAFE Bet Act ignited discussions for stricter online gaming restrictions.

NCLGS lawmakers included in their model some stricter restrictions than used in many of the states currently offering legal iGaming:

• Prohibiting the use of credit cards to fund iGaming accounts.
• Limiting total deposits by an individual over a 24-hour period to $20,000.
• Creating a Player Health Program to increase public awareness of problem gambling, promote responsible gaming and provide services for problem gambling prevention, treatment and recovery services.
• Requiring each internet gaming operator to identify a responsible gaming lead to collaborate with the regulator.
• Prohibiting use of “risk-free” language in advertising.
• Not permitting advertising on college campuses.
• Requiring iGaming operators to provide all transactional data conducted in the state to any college or university located in the state that requests such information, excluding any personally identifiable information.

NCLGS iGaming model participants

In addition to Fluharty, the Committee on Model Internet Gaming Legislation that drafted the proposal included:

• NCLGS Founder and former Florida Sen. Steve Geller
• Georgia Rep. Al Williams
• New Hampshire Sen. Tim Lang
• Michigan Rep. Tyrone Carter
• Pennsylvania Rep. Joe McAndrew
• Massachusetts Rep. David Muradian
• Washington Rep. Shelley Kloba
• Louisiana Senate Legislative Counsel Alan Miller

Consultants and legal counsel also provided advice.

“I am appreciative to our committee members and stakeholders throughout this process,” Fluharty told PlayUSA. “We look forward to the public comment period and our winter meeting in New Orleans as we take on this important initiative.”

https://www.playusa.com/legislative-council-releases-model-igaming-legislation-draft-ahead-of-winter-meeting/