TwinSpires has been hit with a summary suspension order by the Michigan Gaming Control Board (MGCB) for violations of Michigan’s gaming laws.
Churchill Downs Technology Initiatives, trading in the state as TwinSpires, has breached statutory requirements and specifically the state’s Horse Racing Law of 1995.
Under the law, both simulcast and advance deposit wagering (‘ADW’) are only permitted if tied to a live race meet and a licensed track. Michigan’s last horse racing track, Northville Downs, closed in February 2024 after 80 years.
Only TwinSpires fails to comply
On 23 December 2024, the Gaming Control Board instructed the four licensed ADW providers operating in the State to stop conducting business with Michigan residents, effective 1 January 2025.
The four operators in question are:
- Churchill Downs Technology Initiatives (trading as TwinSpires);
- Xpressbet LLC
- ODS Technologies L.P. (trading as TVG Network)
- NYRAbets LLC
Three of the operators have complied with the MGCB’s request, whereas TwinSpires informed the Board on 31 December 2024 that it would continue to offer account wagering for Michigan residents.
In a release, the MGCB outlined that “TwinSpires’ continued violation of legal regulations prompted the MGCB to intervene and enforce compliance with the established laws governing simulcast racing by issuing the summary suspension order.”
Moving forward, a virtual hearing has been requested before an Administrative Law Judge to determine whether the summary suspension levied on TwinSpires should continue or if the company should be hit with other fines and penalties.
The Wolverine state’s regulator hopes ADW can resume soon. The website’s notice on the topic reads: “ADW providers (known as third-party facilitators) can only function through a licensed track. To obtain a license, a track must meet specific requirements, undergo necessary improvements, and pass various inspections. The MGCB remains committed to regulatory compliance and upholding industry standards. With that being said, as soon as a track is issued a license, we anticipate ADW resuming shortly thereafter.”
It concludes: “The MGCB is committed to upholding the integrity of all laws and regulations governing horse racing and wagering in the state of Michigan. We greatly appreciate your patronage and understanding.”
What was the size of ADW in Michigan?
According to the Michigan Gaming Control Board’s most recent horse racing annual report, TwinSpires was the largest third-party facilitator of the four companies operating under a license.
TwinSpires took $46,395,679 in wagers in 2022, representing 52.8% of the market. This decreased to 48.9% after wagers decreased 6.8% from 2022 to 2023, as TwinSpires reported $43,210,474 in bets.
The total tax generated from ADW in 2023 was $883,857. When compared to the tax paid by the three state casinos in 2023 ($155.2 million) it’s clear that the ADW market is a comparatively tiny element in Michigan’s overall gambling ecosystem.
Churchill Downs has responded by filing, claiming that ‘state board licensing requirements are preempted by 1978 Interstate Horseracing Act and violate Commerce Clause of U.S. Constitution’.