Commerce Casino Clarifies Stance on Online Poker Legislation
Recently, the Commerce Casino, Bicycle Casino, Hawaiian Gardens, and Hollywood Park joined in opposition Congressman Barney Frank’s (D-MA) HR 2267, which would create a full licensing and regulatory framework for the internet gambling industry in the United States. The four casinos have found themselves in a war of words of sorts against the Poker Players Alliance (PPA), which has launched an online petition at PlayersBeforeProfits.com to reverse their stance against the groundbreaking legislation. Poker News Daily sat down with card room coalition spokesperson Waltona Manion to explore the coalition’s resistance.
Many in the industry have asked what brand of internet gambling legislation the Commerce Casino and its allies in California would support, if any. Federal licensing? State licensing? Poker only? Manion explained that the coalition is not against internet gambling: “We’re looking for Federal enforcement of the same strict licensing and regulation for online poker as U.S. land-based casinos abide by. This means that they have to license all of their employees and the physical operations should be in the U.S. In addition, the hardware and software should be tested and certified.” The California Gaming Association also opposes HR 2267.
The coalition also supports not granting Federal licenses to any entity that has violated U.S. law. Manion added, “Another criteria would be poker only. The Frank bill as it’s currently written authorizes all types of gaming. That violates Federal law and breaks agreements of states and tribal nations. It would violate the Indian Gaming Regulatory Act.” One amendment to Frank’s HR 2267 prohibited online wagering on sports, leading to the NFL dropping its opposition to the bill. Manion also stated that states should have the right to continue to regulate gaming in their own jurisdiction.
Manion also expressed concern over the level of protections included in Frank’s measure: “Frank’s bill provides fewer industry regulations and player protections. It imposes lower taxes for foreign online companies than what U.S. casinos pay. It would enable illegal offshore companies to export significant money from our economy.” The tax companion bill to HR 2267 is Congressman Jim McDermott’s (D-WA) HR 4976, which has not yet been marked up in the House Ways and Means Committee.
Despite the spat playing out in the public arena, Manion told PND that the poker lobbying organization and the California casinos have not yet sat down and discussed their differences on HR 2267: “The PPA’s leadership were present during the Financial Services Committee hearing and said nothing to us. They did not contact anyone from the Commerce Casino or any of the card rooms. Had the PPA contacted the Commerce or the major card rooms in California and said they had major concerns or if they had read the testimony more closely, they would agree that most of what we’re talking about is valid.”
According to a 2009 survey by Fairbank, Maslin, Maullin, and Associates, 55% to 57% of Californians support the state collecting revenues from online poker. Among the most important factors to respondents were ensuring that minors don’t play, full transparency, independent audits, and cracking down on unauthorized sites. The West Coast state could be among the first to green light intrastate internet gambling given a sizable budget shortfall. California State Senator Rod Wright had introduced SB 1485 this year, but the bill ultimately stalled on its way to becoming law in July.
HR 2267 offers an opt-out provision for states and tribes that don’t want to take part in a Federal internet gambling scheme. However, Manion believes that the provision won’t stand up if reviewed by the World Trade Organization (WTO): “We don’t believe that the opt-out provision as currently written will hold up to WTO scrutiny. If they were to challenge HR 2267, that’d be the component that would be challenged. We should preempt that now so we don’t get a challenge from the WTO. It would leave state-regulated gaming vulnerable.”
Nevertheless, if HR 2267 were to become law before the end of the current legislative session, California could opt out of the legislation and go it alone in the online poker world. However, its lack of liquidity compared to the Federal model could result in its demise. Manion remarked, “Our immediate focus is amending the Federal legislation and also working with the state legislature on legislation they believe would ensure that California revenues stay in California. If the Frank bill passed, the opt-out provision would be in play and California could opt out. The California state legislature could also act in advance of Frank’s bill becoming law.”
HR 2267 was marked up and passed out of the Financial Services Committee on July 28th. Congress is currently in recess.
The PPA’s petition has lapped 7,200 players and talk of a boycott of the Commerce has arisen among poker pros. UB.com pro Annie Duke, for example, commented via Twitter, “I and some other pros are boycotting them as well. I will give my business to a place that supports the players.” What the next chapter will be in this ongoing saga is anyone’s guess.
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