Michigan Office of Administrative Hearings and Rules  
Administrative Rules Division (ARD)  
MOAHR-Rules@michigan.gov  
REGULATORY IMPACT STATEMENT  
and COST-BENEFIT ANALYSIS (RIS)  
AGENCY INFORMATION:  
Department name:  
Treasury  
Bureau name:  
Michigan Gaming Control Board  
Name of person filling out RIS:  
John McKeown  
Phone number of person filling out RIS:  
517-335-5600  
Email of person filling out RIS:  
McKeownJ4@michigan.gov  
RULE SET INFORMATION:  
ARD assigned rule set number:  
2024-4 TY  
Title of proposed rule set:  
Internet Gaming Rules  
COMPARISON OF RULE(S) TO FEDERAL/STATE/ASSOCIATION STANDARDS  
1. Compare the proposed rules to parallel federal rules or standards set by a state or national licensing agency  
or accreditation association, if any exist.  
Section 2(b) of the Lawful Internet Gaming Act, MCL 432.302(b), recognizes that this Act is consistent and complies  
with the Unlawful Internet Gambling Enforcement Act of 2006, 31 USC 5361 to 5367. Otherwise, there are no parallel  
federal rules or standards set by a state or national licensing agency or accreditation association.  
A. Are these rules required by state law or federal mandate?  
The proposed rules are authorized under § 10 of the Lawful Internet Gaming Act, MCL 432.310, which says the  
Board shall promulgate rules pursuant to the administrative procedures act of 1969, 1969 PA 306, MCL 23.201  
to 24.328, and may include anything necessary and proper to govern internet gaming.  
B. If these rules exceed a federal standard, please identify the federal standard or citation, describe why it  
is necessary that the proposed rules exceed the federal standard or law, and specify the costs and  
benefits arising out of the deviation.  
Section 2(b) of the Lawful Internet Gaming Act, MCL 432.302(b), recognizes that this Act is consistent and  
complies with the Unlawful Internet Gambling Enforcement Act of 2006, 31 USC 5361 to 5367. There are  
otherwise no federal standards.  
2. Compare the proposed rules to standards in similarly situated states, based on geographic location,  
topography, natural resources, commonalities, or economic similarities.  
The Board compared its vendor requirements and registration to three similarly situated states: Pennsylvania, West  
Virginia, and New Jersey. These states were selected due to their comparability across several factors, including  
authorization of internet gaming, geographic location, market size, operating and regulatory structure (privately-  
operated, state-regulated), and regulatory history and experience. These states have established licensing standards  
for suppliers and include registration or certification procedures for companies providing similar services as vendors.  
All three states have responsible gaming requirements with varying details about providing information to the public  
and prominently displaying information about responsible gaming.  
MCL 24.245(3)  
RIS-Page 2  
A. If the rules exceed standards in those states, please explain why and specify the costs and benefits  
arising out of the deviation.  
In general, the proposed rules are materially consistent with and do not exceed standards in similarly situated  
states.  
3. Identify any laws, rules, and other legal requirements that may duplicate, overlap, or conflict with the  
proposed rules.  
Generally, the proposed rules do not duplicate, overlap, or conflict with other laws, rules, or legal requirements.  
A. Explain how the rules have been coordinated, to the extent practicable, with other federal, state, and  
local laws applicable to the same activity or subject matter. This section should include a discussion of  
the efforts undertaken by the agency to avoid or minimize duplication.  
The proposed rules have been coordinated with the Lawful Sports Betting Act, MCL 432.401 through 432.419.  
PURPOSE AND OBJECTIVES OF THE RULE(S)  
4. Identify the behavior and frequency of behavior that the proposed rules are designed to alter.  
(1) The proposed amendments to Rule 432.629 split vendor requirements and vendor registration into two parts.  
Currently, there are more than 350 vendors registered with the Board. This reorganization will clarify the process for  
new registrants and make clear the Board’s regulatory authority over vendors.  
(2) Currently, Rule 432.654(a) imposes requirements on internet gaming operators and internet gaming platform  
providers to prominently display a specific Michigan gambling helpline on their websites. The proposed amendment  
to Rule 432.654(a) changes this to a more generic requirement for operators and platform providers to provide a toll-  
free compulsive gambling helpline while continuing to provide information about how to access additional long-term  
resources for help with compulsive gambling.  
A. Estimate the change in the frequency of the targeted behavior expected from the proposed rules.  
There is no change in frequency of the targeted behavior expected from the proposed rules.  
B. Describe the difference between current behavior/practice and desired behavior/practice.  
The difference between current behavior/practice and desired behavior is that vendor requirements and vendor  
registration will be separate, making the registration process clearer. Further, operators and platform providers  
will have more flexibility in displaying a toll-free compulsive gambling helpline number so a person can call for  
help with a gambling problem.  
C. What is the desired outcome?  
The desired outcome is to: (1) clarify the provisions governing vendor requirements and vendor registration, and  
to clarify the Board’s authority to regulate vendors; and, (2) provide more flexibility to operators and platform  
providers in displaying a toll-free compulsive gambling helpline number while continuing to provide information  
about how to access additional long-term resources for help with compulsive gambling.  
5. Identify the harm resulting from the behavior that the proposed rules are designed to alter and the likelihood  
that the harm will occur in the absence of the rule.  
There is no resulting harm if the proposed rules are not adopted. However, these changes are being made to clarify  
provisions regarding vendor requirements and vendor registration and provide more flexibility to operators and  
platform providers in displaying a toll-free compulsive gambling helpline number so a person can call for help with a  
gambling problem.  
A. What is the rationale for changing the rules instead of leaving them as currently written?  
The rationale for changing the rules instead of leaving them as currently written is: (1) to clarify the provisions  
governing vendor requirements and vendor registration, and to clarify the Board’s regulatory authority over  
vendors; and, (2) to provide more flexibility to operators and platform providers in displaying a toll-free  
compulsive gambling helpline number while continuing to provide information about how to access additional  
long-term resources for help with compulsive gambling.  
6. Describe how the proposed rules protect the health, safety, and welfare of Michigan citizens while promoting  
a regulatory environment in Michigan that is the least burdensome alternative for those required to comply.  
The proposed rule changes protect the health, safety, and welfare of Michigan citizens by clearly setting forth the  
vendor registration and vendor requirements when conducting business with operators and suppliers. Further, the  
public will still have access to information about the availability of a toll-free compulsive gambling helpline for  
immediate support and information about how to access additional long-term resources. The proposed changes  
MCL 24.245(3)  
RIS-Page 3  
promote a regulatory environment that is less burdensome because the requirements are clearer, and the operators  
and platform providers have more flexibility in providing compulsive gambling information.  
7. Describe any rules in the affected rule set that are obsolete or unnecessary and can be rescinded.  
There are no rules in the affected rule set that are obsolete or unnecessary.  
FISCAL IMPACT ON THE AGENCY  
Fiscal impact is an increase or decrease in expenditures from the current level of expenditures, i.e., hiring  
additional staff, higher contract costs, programming costs, changes in reimbursements rates, etc. over and  
above what is currently expended for that function. It does not include more intangible costs for benefits, such  
as opportunity costs, the value of time saved or lost, etc., unless those issues result in a measurable impact on  
expenditures.  
8. Please provide the fiscal impact on the agency (an estimate of the cost of rule imposition or potential savings  
for the agency promulgating the rule).  
Section 16(1) of the Lawful Internet Gaming Act creates the internet gaming fund in the state treasury. MCL  
432.316(1). Application fees, license fees, taxes, and payments provided for in the act are to be deposited into the  
fund. The Board is the administrator of the fund for auditing purposes. MCL 432.316(3). Upon appropriations, the  
Board can expend money from the fund to cover the costs of regulating and enforcing the Act. MCL 432.316(4)(a).  
However, the Board expects no fiscal impact with these proposed rule changes.  
9. Describe whether or not an agency appropriation has been made or a funding source provided for any  
expenditures associated with the proposed rules.  
Because there is no fiscal impact on the Board with these proposed rule changes, there is no specific appropriation  
made for any expenditure with the proposed rules.  
10. Describe how the proposed rules are necessary and suitable to accomplish their purpose, in relationship to  
the burden(s) the rules place on individuals. Burdens may include fiscal or administrative burdens, or  
duplicative acts.  
The proposed changes to the rules are necessary and suitable to clarify the regulatory framework governing vendors  
and provide for greater flexibility for operators and platform providers to display a toll-free compulsive gambling  
helpline number. The proposed changes to the rules do not impose any new fiscal, administrative, or duplicative  
burdens on individuals.  
A. Despite the identified burden(s), identify how the requirements in the rules are still needed and  
reasonable compared to the burdens.  
Any burden on a person applying to be a vendor is necessary to regulate internet gaming. The proposed rule  
change will not burden a person seeking a toll-free gambling helpline for immediate support and information  
about how to access additional long-term resources.  
IMPACT ON OTHER STATE OR LOCAL GOVERNMENTAL UNITS  
11. Estimate any increase or decrease in revenues to other state or local governmental units (i.e., cities,  
counties, school districts) as a result of the rule. Estimate the cost increases or reductions for other state or  
local governmental units (i.e., cities, counties, school districts) as a result of the rule. Include the cost of  
equipment, supplies, labor, and increased administrative costs in both the initial imposition of the rule and  
any ongoing monitoring.  
There are no anticipated increases or decreases in revenues to state or local governmental units because of the  
proposed rules. The Lawful Internet Gaming Act allocates a portion of the taxes and payments assessed thereunder  
to the city of Detroit, MCL 432.315(1)(a), Michigan agriculture equine industry development fund, MCL 432.315(1)(c),  
Michigan strategic fund, MCL 432.315a(c), and the governing body of the jurisdiction where a tribe’s casino is located,  
MCL 432.315a(a). In addition, any money remaining in the internet gaming fund after Board expenditures for  
regulatory costs is expended, on appropriation, for the compulsive gaming prevention fund, MCL 432.316(4)(b), first  
responder presumed coverage fund, MCL 432.316(4)(c), and state school aid fund, MCL 432316(4)(d).  
MCL 24.245(3)  
RIS-Page 4  
12. Discuss any program, service, duty, or responsibility imposed upon any city, county, town, village, or school  
district by the rules.  
There are no anticipated or intended programs, services, duties, or responsibilities imposed on any city, county, town,  
village, or school district as a result of these proposed rules.  
A. Describe any actions that governmental units must take to be in compliance with the rules. This section  
should include items such as record keeping and reporting requirements or changing operational  
practices.  
There are no anticipated actions that a governmental unit must take to comply with these proposed rules.  
13. Describe whether or not an appropriation to state or local governmental units has been made or a funding  
source provided for any additional expenditures associated with the proposed rules.  
No appropriations have been made to any governmental unit because of these proposed rules. No additional  
expenditures are anticipated or intended with the proposed rules.  
RURAL IMPACT  
14. In general, what impact will the rules have on rural areas?  
The proposed rules are not expected to impact rural areas.  
A. Describe the types of public or private interests in rural areas that will be affected by the rules.  
The proposed rules should have no impact on public or private interests in rural areas.  
ENVIRONMENTAL IMPACT  
15. Do the proposed rules have any impact on the environment? If yes, please explain.  
The proposed rules do not have an environmental impact.  
SMALL BUSINESS IMPACT STATEMENT  
16. Describe whether and how the agency considered exempting small businesses from the proposed rules.  
Section 10(g) of the Lawful Internet Gaming Act, MCL 432.310(g), requires the Board to promulgate rules regarding  
requirements for vendors and vendor registration. Thus, the agency cannot exempt a small business that might be a  
vendor from the rules. A vendor is a person that is not licensed but supplies goods or services to an internet gaming  
operator or internet gaming supplier. MCL 432.303(ee). Such entities include:  
(a) Affiliate marketers which do not have an agreement based on the sharing of gross receipts or adjusted gross  
receipts.  
(b) Payment processors.  
(c) A person that provides over $100,000.00 worth of goods and/or services to any internet gaming operator or  
internet gaming supplier in connection with its Michigan internet gaming operations in a calendar year.  
(d) Data centers providing physical security and infrastructure.  
(e) Independent integrity monitoring providers.  
(f) Any other person as deemed necessary by the Board.  
While vendors are not required to be licensed, it is necessary to have them registered to regulate internet gaming.  
17. If small businesses are not exempt, describe (a) the manner in which the agency reduced the economic  
impact of the proposed rules on small businesses, including a detailed recitation of the efforts of the agency  
to comply with the mandate to reduce the disproportionate impact of the rules upon small businesses as  
described below (in accordance with MCL 24.240(1)(a-d)), or (b) the reasons such a reduction was not lawful  
or feasible.  
Proposed Rule 432.629a uses language currently found in Rule 432.629. Thus, the proposed rule change does not  
increase an economic impact on small businesses. To register with the Board, a vendor files an application and  
submits a $200 registration fee, R 432.629a(1). This registration must be renewed every five years, R 432.629a(5).  
Even though not licensed, vendors are expected to conduct themselves in a manner that does not compromise the  
MCL 24.245(3)  
RIS-Page 5  
integrity of internet gaming or violate any provision of the Act or rules. Because gaming is a highly regulated industry,  
it is not possible to specifically exempt small businesses from the vendor registration as it would create a disparity in  
regulation.  
A. Identify and estimate the number of small businesses affected by the proposed rules and the probable  
effect on small businesses.  
There are currently more than 350 vendors registered with the Board. Assuming all are small businesses, which  
many are likely not, those 350 vendors would be affected by the proposed rules. The probable effect of the  
proposed rule changes is clarity in the requirements for vendors and for registration.  
B. Describe how the agency established differing compliance or reporting requirements or timetables for  
small businesses under the rules after projecting the required reporting, record-keeping, and other  
administrative costs.  
The Board did not establish separate compliance or reporting requirements for small businesses. To the extent  
practicable, the proposed rules were drafted to be the least burdensome on all impacted persons.  
C. Describe how the agency consolidated or simplified the compliance and reporting requirements for  
small businesses and identify the skills necessary to comply with the reporting requirements.  
The Board did not consolidate or simplify compliance or reporting requirements for small businesses.  
D. Describe how the agency established performance standards to replace design or operation standards  
required by the proposed rules.  
The Board did not establish performance standards to replace design or operation standards for vendor  
registrants.  
18. Identify any disproportionate impact the proposed rules may have on small businesses because of their size  
or geographic location.  
There is no disproportionate impact on small businesses because of their size or geographical location.  
19. Identify the nature of any report and the estimated cost of its preparation by small businesses required to  
comply with the proposed rules.  
Vendors, who might be small businesses, have a continuing duty to notify the Board of any change in information  
previously submitted to the Board. Cost to notify the Board of such changes are minimal.  
20. Analyze the costs of compliance for all small businesses affected by the proposed rules, including costs of  
equipment, supplies, labor, and increased administrative costs.  
There will be no increased cost of compliance for a vendor, who might be a small business, concerning the costs of  
equipment, supplies, labor, or administrative costs.  
21. Identify the nature and estimated cost of any legal, consulting, or accounting services that small businesses  
would incur in complying with the proposed rules.  
There are no expected costs for legal, consulting, or accounting services that a vendor, who might be a small  
business, would incur in complying with the proposed rules.  
22. Estimate the ability of small businesses to absorb the costs without suffering economic harm and without  
adversely affecting competition in the marketplace.  
There are no expected costs to a vendor, who might be a small business, that will cause economic harm or adversely  
affect competition in the marketplace as a result of the proposed rules.  
23. Estimate the cost, if any, to the agency of administering or enforcing a rule that exempts or sets lesser  
standards for compliance by small businesses.  
Vendors, who may be small businesses, are subject to minimal compliance standards and are required to pay minimal  
fees. Therefore, enforcing rules that exempt or set lesser standards for compliance by vendors would have minimal  
impact on vendors and would not materially affect Board revenue or costs.  
24. Identify the impact on the public interest of exempting or setting lesser standards of compliance for small  
businesses.  
There is a public interest in establishing a secure, responsible, fair, and legal system of internet gaming. To the  
extent the proposed rules provide for mere registration for a vendor that might be a small business, the public interest  
is not harmed as the Board retains authority to issue a cease-and-desist order, obtain injunctive relief, or take another  
action necessary to protect the integrity of internet gaming.  
25. Describe whether and how the agency has involved small businesses in the development of the proposed  
rules.  
MCL 24.245(3)  
RIS-Page 6  
No small businesses were involved in the development of the proposed rules. The Board solicited from industry  
stakeholders in developing the proposed rules.  
A. If small businesses were involved in the development of the rules, please identify the business(es).  
No small businesses were involved in the development of the proposed rules.  
COST-BENEFIT ANALYSIS OF RULES (INDEPENDENT OF STATUTORY IMPACT)  
26. Estimate the actual statewide compliance costs of the rule amendments on businesses or groups.  
There are minimal compliance costs because of the proposed amendments. Revenues generated by businesses that  
participate in the internet gaming industry are expected to far exceed any compliance costs.  
A. Identify the businesses or groups who will be directly affected by, bear the cost of, or directly benefit  
from the proposed rules.  
The internet gaming operators, internet gaming suppliers, and vendors will be directly affected by the proposed  
rule changes and will bear the cost, which should be minimal. Operators, suppliers, and vendors will benefit via  
the revenue they generate through participation in the regulated internet gaming industry.  
B. What additional costs will be imposed on businesses and other groups as a result of these proposed  
rules (i.e., new equipment, supplies, labor, accounting, or recordkeeping)? Please identify the types and  
number of businesses and groups. Be sure to quantify how each entity will be affected.  
Except for possibly updating each operator’s website to prominently display a different message than what is  
currently required about a toll-free compulsive gambling helpline number, there will be no additional costs  
imposed on businesses as a result of the proposed rules.  
27. Estimate the actual statewide compliance costs of the proposed rules on individuals (regulated individuals or  
the public). Include the costs of education, training, application fees, examination fees, license fees, new  
equipment, supplies, labor, accounting, or recordkeeping.  
There are no additional statewide compliance costs of the proposed rules on individuals.  
A. How many and what category of individuals will be affected by the rules?  
The public will have access to information about the availability of a toll-free gambling helpline for immediate  
support and information about how to access additional long-term resources.  
B. What qualitative and quantitative impact do the proposed changes in rules have on these individuals?  
The proposed rules will not have a qualitative or quantitative impact on individuals other than clarifying vendor  
requirements and the registration process. Gaming is a highly regulated industry and individuals understand the  
necessity of maintaining a secure, responsible, fair, and legal system of internet gaming in Michigan.  
28. Quantify any cost reductions to businesses, individuals, groups of individuals, or governmental units as a  
result of the proposed rules.  
There are no cost reductions for businesses, individuals, groups of individuals, or governmental units as a result of the  
proposed rules.  
29. Estimate the primary and direct benefits and any secondary or indirect benefits of the proposed rules. Please  
provide both quantitative and qualitative information, as well as any assumptions.  
The primary and direct benefits of the proposed rules are (1) providing a distinction between requirements for vendors  
and vendor registration; and (2) providing flexibility to operators and platform providers in prominently displaying a toll-  
free gambling helpline. The secondary and indirect benefits of the proposed rules are: (1) clarity as to who needs to  
register as a vendor and what is required of a vendor; and (2) continuing to ensure the public has access to  
information about the availability of a toll-free compulsive gambling helpline for immediate support and information  
about how to access additional long-term resources for help with compulsive gambling.  
30. Explain how the proposed rules will impact business growth and job creation (or elimination) in Michigan.  
The proposed rules are not expected to have an impact on business growth or job creation or elimination in Michigan.  
31. Identify any individuals or businesses who will be disproportionately affected by the rules as a result of their  
industrial sector, segment of the public, business size, or geographic location.  
Individuals or businesses will not be disproportionately affected by the proposed rules because of their industrial  
sector, segment of the public, business size, or geographic location.  
MCL 24.245(3)  
RIS-Page 7  
32. Identify the sources the agency relied upon in compiling the regulatory impact statement, including the  
methodology utilized in determining the existence and extent of the impact of the proposed rules and a cost-  
benefit analysis of the proposed rules.  
The Board relied upon agency staff and its regulatory experience to determine the impact of the proposed rules.  
A. How were estimates made, and what assumptions were made? Include internal and external sources,  
published reports, information provided by associations or organizations, etc., that demonstrate a need  
for the proposed rules.  
The Board relied on agency staff and its regulatory experience to formulate estimates and assumptions and  
determine the need for the proposed rules. The Board also investigated responsible gaming measures to  
determine the best practice for advising individuals of responsible gaming measures.  
ALTERNATIVE TO REGULATION  
33. Identify any reasonable alternatives to the proposed rules that would achieve the same or similar goals.  
The proposed changes are minimal. There are no reasonable alternatives to the proposed rules that would achieve  
the same or similar goals.  
A. Please include any statutory amendments that may be necessary to achieve such alternatives.  
There is no reasonable alternative to the proposed rules; thus, no statutory amendments are necessary to  
achieve such alternatives.  
34. Discuss the feasibility of establishing a regulatory program similar to that proposed in the rules that would  
operate through private market-based mechanisms. Please include a discussion of private market-based  
systems utilized by other states.  
No alternative to promulgating administrative rules, including private market-based mechanisms, is feasible to  
regulate internet gaming. The Legislature has found it to be in the best interest of this state and its citizens to regulate  
this activity by establishing a secure, responsible, fair, and legal system of internet gaming, MCL 432.302(d).  
Moreover, the Legislature charged the Board with supervising all internet gaming operations and granted the Board  
powers and duties to administer, regulate, and enforce internet gaming, MCL 432.305(1). The Board is not aware of  
any states that utilize a private market-based system, as opposed to a state regulatory body, for this purpose.  
35. Discuss all significant alternatives the agency considered during rule development and why they were not  
incorporated into the rules. This section should include ideas considered both during internal discussions  
and discussions with stakeholders, affected parties, or advisory groups.  
No significant alternatives were considered during the development of the proposed rules. The proposed rules are  
intended to align with the requirements and public policy objectives of the Lawful Internet Gaming Act. The Board  
solicited feedback from internet gaming stakeholders and revisions were requested.  
ADDITIONAL INFORMATION  
36. As required by MCL 24.245b(1)(c), please describe any instructions regarding the method of complying with  
the rules, if applicable.  
The rules inform vendors of the registration process and requirements of being a vendor. Other information, including  
forms and applications, will be available on the Board’s website.  
MCL 24.245(3)  
;