Michigan Caps Commercial Casino Licenses at Three

Casino gaming is not zoned like an ordinary land use in Michigan, it is licensed at the state level under the Michigan Gaming Control and Revenue Act, Initiated Law 1 of 1996 (Proposal E), and a commercial casino can open only in a city that clears specific statutory gates. 206(1)(a)-(c), an applicant is eligible only if the city's local legislative body has enacted an ordinance approving casino gaming, the applicant has entered a certified development agreement with that city, and the applicant shows a history of or bona fide plan for investment or community involvement in the city where the casino will be located.

A city cannot have more than three certified development agreements pending before the Michigan Gaming Control Board at once, though it can sign more than three over time if earlier applicants are denied. The board itself is capped at issuing no more than three casino licenses in any single city, and it cannot license a casino on land held in trust by the United States for a federally recognized Indian tribe. Where more than three applicants meet the eligibility and suitability standards, the board must give licensing priority to applicants whose casino proposal went to a citywide vote before January 1, 1995, and won, a rule written around Detroit's 1994 casino referendum.

Since the act took effect December 5, 1996, only Detroit has enacted the required ordinance and negotiated development agreements, which is why the state's three commercial casinos, MGM Grand Detroit, MotorCity Casino, and Hollywood Casino at Greektown, are all sited there. The Michigan Gaming Control Board, not a city planning department, licenses and regulates casino gaming statewide; local zoning still governs the physical site plan but cannot independently authorize or forbid casino gaming outside this licensing framework.

Operating a casino without a Michigan Gaming Control Board license, or continuing after a license is revoked, is not a mere zoning violation. MCL 432.220 subjects the operator to a civil penalty equal to the full gross receipts wagered that day on the unauthorized games, plus confiscation and forfeiture of all gambling equipment used. A city that never adopts a casino-gaming ordinance or development agreement simply keeps casino gaming illegal within its borders.