Minnesota Sports Betting Faces Deadline as Legalization Stalls

Minnesota is once again approaching a critical legislative deadline without finalizing a framework to legalize sports betting. As the 2025 legislative session nears its scheduled conclusion on May 19, lawmakers have yet to reach an agreement that would allow regulated sports wagering in the state, leaving Minnesota as one of the few states without such laws in place.

Ongoing Disputes and Gray Areas in Minnesota’s Sports Betting Market

Since the 2018 Supreme Court ruling that overturned the Professional and Amateur Sports Protection Act, states have had the authority to legalize sports betting, prompting Minnesota to pursue legislation since 2019. However, multiple attempts to such laws have repeatedly faltered, primarily due to disputes over market control and financial interests among tribal nations, racetracks, and commercial operators.

Despite having backing from all eleven federally recognized tribes in Minnesota, alongside horse racing tracks and charitable gaming groups, a Senate bill failed to clear the floor in February. Subsequently, two new legislative proposals, S.F. 3414 and H.F. 1842, were introduced to sustain the push for legalization, but with time running out, no comprehensive deal appears imminent.

Without legal safeguards and regulation, Minnesota continues to struggle with unregulated sports gambling. The absence of clear laws has created a gray area exploited by daily fantasy sports (DFS) companies. These firms, including BettorEdge, operate peer-to-peer betting platforms where s wager against each other rather than a bookmaker, sidestepping traditional sportsbook regulations.

Greg Kajewski, CEO and co-founder of BettorEdge, explained the distinction: “Fantasy betting is peer-to-peer, where you are competing against your friends and having fun.” He emphasized that these apps are fundamentally different from sportsbooks because no entity profits directly from a player’s losses.

Many DFS platforms like Sleeper, PrizePicks, and Underdog have voluntarily restricted some types of bets despite lacking formal regulation. For instance, Sleeper limits s to a single pick per bettor and excludes moneyline bets. Meanwhile, major operators such as FanDuel and DraftKings have opted to exclude Minnesota entirely from their offerings to avoid legal risk.

Senator Jeremy Miller, a Republican from Winona, highlighted the widespread nature of illegal sports betting in Minnesota. According to Play Minnesota, an organization tracking gambling trends, nearly $929 million was wagered illegally on sports in 2023. Miller noted, “Gambling in Minnesota is already very readily available,” pointing to lotteries, casinos, and horse betting as accessible forms.

Personal Experiences and Concerns Around Problem Gambling

The challenge of problem gambling remains a pressing concern. Surveys at the University of Minnesota reveal that while 40.6% of students engage in fantasy sports, only 16.5% regularly bet on sports. Individuals like McKray Tuma and Hudson Weber shared personal experiences with betting apps, highlighting both financial losses and reliance on promotional funds.

Experts stress that problem gambling is defined by its harmful effects rather than frequency. Susan Sheridan Tucker, executive director of the Minnesota Alliance on Problem Gambling (MNAPG), warned that gambling promotions often manipulate players into continued spending. She emphasized, “It is not a lack of willpower. It is not a moral failing,” adding that gambling addiction impacts the brain similarly to substance abuse.

Legislative Deadlock and the Path Forward

Central to the legislative ime is the rivalry between the state’s racetracks—Canterbury Park and Running Aces—and tribal nations over market control. The tribes have consistently pushed for exclusive rights to sports betting, while racetracks seek a portion of the market either through their own sportsbooks or partnerships. Senate proposals have tried to balance these interests by granting tribes authority over mobile sports betting and allowing limited betting on-site at racetracks, but the path to approval remains uncertain.

Concerns about expanding gambling and its potential to increase addiction have also contributed to resistance. Opponents argue that legalization could worsen problem gambling rates,a sentiment echoed by some lawmakers.

House Representative Cedrick Frazier, a Democrat from New Hope and primary sponsor of the House bill, is working closely with MNAPG to ensure problem gambling prevention is integral to legalization efforts. He remarked, “Legalizing sports betting in Minnesota gives us the opportunity to not just acknowledge the problem, but to actively address it by creating a regulatory framework and dedicating real resources to prevention, intervention and that don’t actually exist.”

Frazier emphasized learning from other states that have already enacted sports betting laws to avoid pitfalls. “We’re going to be able to start from a place where we’ve seen what works, what didn’t work, and to put that in an initial onset to prevent as much as possible as we can with problem gambling,” he said.

Meanwhile, efforts to move the issue forward have stalled elsewhere in the Capitol. A proposal to study and evaluate the feasibility of sports betting legalization was rejected by the Senate Taxes Committee, signaling reluctance to even consider the matter further this session. Committee chair Ann Rest described the legislation as “too preliminary” amid a year marked by uncertainty on various fronts.

Senator Matt Klein, a longtime advocate for legalization, expressed disappointment over the committee’s decision, stating that by “refusing to move forward with even a study,” lawmakers are abandoning not only the sovereign tribes for whom sports betting is a top priority but also the many Minnesotans already participating in unregulated gambling.

With the session’s end approaching and a two-year state budget still unsettled, Governor Tim Walz is expected to call a special session, making the future of sports betting legalization in Minnesota uncertain yet again.

Sources:

Legislative deadline looms as Minnesota struggles to finalize sports betting bill, Minnesota Daily, mndaily.com, May 16, 2025