NCLGS Releases Draft Plan for Online Casino Laws

The National Council of Legislators from Gaming States (NCLGS) has introduced its draft Model Internet Gaming Act (MIGA), a proposed framework aimed at guiding states in regulating online casino gaming. Released on the cusp of the NCLGS winter meeting, the draft is now open for public comment, marking a significant step toward standardizing online gambling laws across the U.S.

MIGA is designed to simplify the legislative process for states considering online gaming, foster consistency across state lines, and ensure consumer protection while minimizing the black market. Developed with input from legislators, industry experts, and regulators, the act balances economic growth with ethical gaming practices. It establishes standards for taxation, licensing, and responsible gaming while allowing flexibility for states to adapt the framework to their unique needs.

 

The Proposed Principles

Three guiding principles shape the draft: ensuring online gaming supports, rather than undermines, licensed casinos and racinos; maintaining strict regulatory oversight to bolster public confidence; and criminalizing unlicensed online gaming to protect the regulated market. Together, these aims reflect a broader vision of fostering a trustworthy and competitive gaming environment.

Taxation and licensing are central to the draft, with NCLGS recommending a tax range of 15%-25% for online casino revenue—significantly lower than Maryland’s proposed 55% rate or Pennsylvania’s 36%. This approach emphasizes affordability and market growth, recognizing that excessive taxation could deter potential operators. Licensing provisions include five-year terms, temporary permits for operators licensed in other states, and options for competitive bidding in states with limited licenses.

In response to rising concerns about problem gambling, the draft also proposes stricter responsible gaming measures than those currently used in many states. Credit cards would be prohibited for deposits, daily deposit limits set at $20,000, and a Player Health Program established to address addiction and promote responsible gaming. Other notable provisions include banning misleading advertising, particularly on college campuses, and requiring operators to share transactional data (excluding personal identifiers) with universities upon request.

Although NCLGS originally planned to vote on the draft at its December 14 meeting in New Orleans, the timeline has shifted to allow more public input. Comments will be accepted until December 31, with a formal vote expected in early 2025. This delay ensures ample opportunity for feedback and refinement, allowing legislators to use the act as a guide for bills as early as January.

 

My hope is that this model legislation will be a catalyst in producing public policy that benefits states for generations to come.

 

The Future

MIGA’s release represents a turning point for the online gaming industry, offering a pathway to greater regulatory consistency across states. While operators might benefit from streamlined processes and lower taxes, some states may push back, prioritizing higher rates to maximize revenue. Restrictions on marketing and credit card use could also lead to significant shifts in industry practices.

As the public comment period unfolds, the draft’s reception will shape its final form and, potentially, the future of online gaming legislation in the U.S. By addressing economic, regulatory, and ethical concerns, NCLGS aims to provide a robust foundation for a growing sector poised to influence state economies for years to come.