For years, proponents of online poker in California have been trying to get something going in the state legislature, only to have every bill die before it can even get on its feet. Yesterday, though, one bill finally took its first step. The California State Assembly Governmental Organization (GO) Committee passed AB 431 by a unanimous 20-0 vote on Tuesday, advancing a pro-online poker bill to the floor of the full Assembly for the first time in state history.
Not only was this the first time a poker bill has made it this far (and let’s be clear, this is not all that far), but it is the first time a bill had ever even been voted upon by a committee. It also indicates that the various stakeholders in California, particularly the Native American tribes, have at least been able to narrow the philosophical gap somewhat in order for there to be enough support for AB 431 to advance it to the next stage.
AB 431 is just a small, two-page, skeleton bill that simply legalized online poker within state borders and paves the way for regulations and a licensing structure to be developed. It is best summed up by the Legislative Counsel’s Digest:
Existing law, the Gambling Control Act, provides for the licensure and regulation of various legalized gambling activities and establishments by the California Gambling Control Commission and the investigation and enforcement of those activities and establishments by the Department of Justice.
This bill would authorize the operation of an Internet poker Web site within the borders of the state. The bill would require the commission, in consultation with the department, to promulgate regulations for intrastate Internet poker. The bill would require those regulations to include, but not be limited to, a licensing process for an individual or entity to become an operator of an Internet poker Web site and rules for the operation of an Internet poker Web site.
Though many bills have been presented to legalize internet poker in California over the years, none, as mentioned, have even come up for committee vote. The main problem has always been that all the different parties who want a piece of the action have been unable to agree upon certain issues. Of particular note is a “bad actor” clause, which would prevent any entity or individual who stayed in the U.S. market after the UIGEA was passed in late 2006 from applying for an online poker license. Some factions in California want a bad actor clause in any legislation, some do not.
The leading faction that is against bad actor clauses is known as the Amaya coalition, so named because it is led by Amaya Gaming, parent company of PokerStars. PokerStars, the largest online poker room in the world, would be a significant competitive threat to any poker operator and is the clear target of bad actor clauses (PokerStars kept serving U.S. customers until April 2011). Also in the Amaya coalition are the Morongo Band of Mission Indians, the San Manuel Band of Mission Indians, and California’s three largest card clubs, the Commerce Casino, Hawaiian Gardens Casino and Bicycle Casino. They put out a statement after the vote that read, in part:
Authorizing online poker will be good for millions of consumers and poker players who will benefit from a safe, regulated environment where they are protected. Every year that California fails to act not only puts consumers at risk while playing online games from offshore localities that provide few protections and regulations, but our state also loses out on collecting hundreds of millions of dollars that can be used for essential programs like public schools, public safety, healthcare and social services.
Our coalition is committed to putting in the time necessary to establish a vibrant, competitive marketplace, one that provides superior consumer protections, requires strict oversight and regulation of operators and licensees, and ensures that the state receives a reasonable return.
