Three US States Consider I-Gaming
With little hope of a national regulatory regime in the United States any time soon, the Nevada Legislature is considering a bill in the current session that would authorize Gov. Brian Sandoval to enter into agreements with other states to share online poker players.
Assembly Bill 5, which was pre-filed in December 2012 on behalf of the state Gaming Control, would place the state’s licensees in a position to offer poker on an interstate basis as other states ease restrictions on internet gambling or approve enabling legislation.
The bill does away with a provision in the state’s 2011 enabling legislation that forbids its licensees from accepting wagers across state lines until Congress or the U.S. Department of Justice takes regulatory action.
Sandoval supports the legislation, and Gaming Control Board Chairman A.G. Burnett says he doesn’t foresee any conflicts with federal law.
Licences have been issued to 20 casinos and other entities to offer online poker within Nevada. What’s left now is for regulators to approve their systems, which are still being tested for compliance with technical standards.
Given the risks of cannibalization, which is becoming a serious problem for several U.S. land-based markets, it’s not certain whether other states will prefer to resist Nevada’s initiative.
Poised to become the third state to legalize intrastate Internet gambling, supporters of internet gambling in New Jersey are hailing Gov. Chris Christie’s conditional support as a “defining moment” for Atlantic City and a “lifeline” for at least one of the ailing seaside resort’s land-based operators.
Others are not so sure, though they appear decidedly to be in the minority, given the broad political and commercial support for legalization statewide: from Democratic and Republican lawmakers, who joined forces in December to approve enabling legislation; from the Casino Association of New Jersey; from the parent company of Isle of Man-based online poker giant PokerStars, which has plans for rescuing the financially strapped Atlantic Club Casino Hotel; from organized labour; and this time around, even from the governor.
Bolstering the general enthusiasm is a new forecast from Macquarie Capital gaming analyst Chad Beynon, who estimates that taking their casinos online will generate the Atlantic City’s operators up to $300 million in incremental gaming revenue a year.
Christie vetoed the December legislation earlier this month but advised lawmakers that he will sign a bill with revisions that include a 10-year sunset provision and an increase in the tax on revenue from 10 to 15 per cent.
In his veto message, the governor also expressed concern with the social risks and wants additional funding for treatment programs for problem gamblers and annual audits by licensees of the impacts of their operations on vulnerable segments of the population. He also recommends retaining an existing ban on state employees and legislators working in the industry. And he wants elected officials to be required to disclose any ties to internet gambling companies.
Observers believe the Legislature will agree with the governor’s recommendations and act quickly to send him a bill he can live with. The leaders of the Senate and Assembly say the Legislature will vote on Christie’s recommendations on 26 February.
Sceptics, however, suggest that giving people the opportunity to gamble online will further erode the city’s dwindling customer base.
Wayne Schaffel, a public relations consultant and former casino executive told The Press of Atlantic City,
Frawley, among others, heartily disputes that. “When people are questioning if this is good for Atlantic City, I think they are being a little short-sighted. This is again a defining moment for Atlantic City. Are we going to let it pass by?”
The Delaware Gaming Competitiveness Act of 2012 authorizes the Delaware Lottery and the state’s video lottery agents to offer lottery tickets and casino-style games online, including poker, to state residents only.
The lottery recently issued a request for proposals to supply the necessary technology. Vendors are being sought to handle game content, operations management, the back-end platform and support services.
The request is limited to companies that have been in business for at least a year and have operated real-money games either in Europe or North America.
Internet poker is also back on the legislative agendas in Iowa and Hawaii.
The bill contemplates an unlimited number of licenses good for an initial term of three years, with operations taxed at 22-24 per cent of gross revenues.
Significantly, licensees would be allowed to band together to offer interstate wagering.
Iowa Racing & Gaming Commission Chairman Jeff Lamberti says his office is ready to regulate online poker should it be legalized.
A bid to bring online gambling to Hawaii failed in both the state House and Senate last spring, but a trio of senators believes the chances will be better this year. But given that Hawaii is one of only two U.S. states (Utah is the other) that host no legal gambling, it’s likely to be an uphill fight.
SB 768, backed by Democrats Donovan M. Dela Cruz, Gilbert Kahele and Malama Solomon was introduced on 18 January and referred to the committees on Ways and Means, Judiciary and Labor, Technology and the Arts and Economic Development, Government Operations and Housing. It would create a Hawaii Internet Lottery and Gaming Corporation to regulate a full range of games, including casino, poker and lottery, but with sports betting specifically prohibited.
Like the Iowa bill, the Hawaii measure would permit interstate operations and would allow the proposed Internet Lottery and Gaming Corporation to enter into compacts with other state regulatory agencies.
The bill also authorizes free-play games and sweepstakes outside of Hawaii.
Operators also would be allowed to leverage their internet offerings at up to two land-based events a year targeted to tourists.