April Legislative Recap: California iPoker Bill Passes Committee


Adam Gray’s bill regulating online poker in California highlighted legislative developments in the United States in April

April was a banner month for online poker in California. The dream of regulated online poker in the Golden State took a major step forward in the final week of April, as the Assembly Governmental Organization Committee passed AB 2863 unanimously, 18-0.

“We know unequivocally that Californians are playing these games online every single day on websites that provide zero consumer protections,” said Adam Gray, who introduced the bill. “After countless revisions and meetings with stakeholders and consumer advocates, there remained two key issues raised by opponents: horse racing and suitability. Today we put forward language that settles the horse racing component, and negotiations over suitability continue.”

The bill bypasses the Appropriations Committee and now heads to the full Assembly for debate, where it must pass by a two-thirds vote.

The support of the horse racing industry appears to be key. The measure gives the horse racing contingent $60 million in subsidies, although that’s a number Online Poker Report seems to think could be unattainable.

With the horse racing industry seemingly on board, the final major hurdle for Gray’s bill to overcome involves its stance on so-called “bad actors,” companies like PokerStars that took real money US bets after the passage of the Unlawful Internet Gambling Enforcement Act in 2006.

“The bill’s prospects, without the support of all the tribes in the state on bad actor language, would appear to be poor,” Online Poker Report’s Dustin Gouker said.

During the committee hearing, it was revealed that 20 card rooms submitted a letter in support of Gray’s bill. Moreover, according to Steve Ruddock, “Horse racing is politically powerful, so their outright lobbying for AB 2863 likely increases pressure on lawmakers.”

Poker Players Alliance Executive Director John Pappas was among the witness panel for the hearing. “I’m pleased with today’s result, but let’s only take a moment to celebrate,” Pappas said after the committee unanimously approved the bill. “There’s still a lot of ground to plow. I am going to need your help.”

Speaking of a lot of ground, tribal divisions still must be mended. The Pechanga and Agua Caliente tribes are adamant about including bad actor language in any California bill regulating iGaming. Meanwhile, PokerStars, which could be barred from California if bad actor language exists in a bill, has partnered with a group of card rooms and tribes that includes the powerful Morongo Band of Mission Indians.

As OPR put it, “If Pechanga and Agua Caliente still seem to be taking a hard-line approach on the suitability standard, getting to a consensus seems a long way off.” Given the strong influence of tribes in the Golden State, that division could be enough to derail any legislation.

New York Online Poker at a Standstill

In January, Assemblyman J. Gary Pretlow introduced a bill, A 9049, that would regulate online poker in New York, the third straight year such a bill has appeared. However, progress on the issue has crawled to a snail’s pace despite the fact that the New York State Senate’s version of A 9049, called S 5302B, has already advanced to the Senate Finance Committee, the first time an online poker bill in New York has ever been affirmatively voted on.

In early April in Las Vegas at the annual iGaming North America (iGNA) conference, more details about the future of online poker in the Empire State were revealed. Online Poker Report’s Chris Grove, who was in attendance live-Tweeting, said that Pretlow acknowledged there may even be a constitutional issue with the iGaming bill, although “he feels he can get around it.”

Assemblyman J. Gary Pretlow is spearheading the online poker drive in New York

Grove added that Pretlow was concerned about the ability of current technology to prevent minors from playing and said that New York would likely go it alone online and not share liquidity with other states. If the latter holds true, New York’s 20 million residents would only be able to play with other players in New York.

According to PokerNews, Pretlow seemed more confident that legislation regulating daily fantasy sports will advance in New York. “I’ve been in constant contact with FanDuel and DraftKings and we’re in the process now of proposing legislation to legalize them,” the lawmaker said. “I’m halfway through looking at the various proposals in other states to see how they did it.” He put the odds of DFS legislation passing at better than 50%.

Comparatively, Pretlow said that the odds of online poker being addressed in 2016 were extremely slim: “There are some issues there and we’re not really prepared to introduce legislation that’s going to go to the floor for a vote, so you’re looking at a 100-1 shot to hit the floor, a 1,000-1 shot to hit the floor.”

PokerStars and Caesars Could Be on the Same Page

Also at iGNA, representatives from PokerStars and Caesars seemed to be on the same page. Whereas in the past the two sides have scuffled, in Las Vegas, all bets were off.

“Seeing representatives from the two parties agree throughout the entire panel opened a lot of eyes that the Caesars-PokerStars relationship is different than that of the rivalry it has been in the past,” PokerNews Editor-in-Chief Donnie Peters said. “The two echoed a shared vision, where, although still competitors in the space, stakeholders can work together for betterment of the industry.”

Case in point: Caesars Senior Vice President Michael Cohen raised a critical question during an iGNA panel: “How can legislators get on board with legislative efforts when those in the industry can’t even align for it?”

Cohen added that Sands CEO Sheldon Adelson remains the single largest obstacle to online gambling legislation in the US.

Poker Players Are Politically Active

One of the knocks on poker players over the years has been their overall apathy. Poker players would “talk the talk” and say they’d be active politically, write their Congressmen, and vote in the best interests of poker, but ultimately none of that would come to fruition.

Enter a new survey from the Poker Players Alliance, the main lobbying voice for poker players on Capitol Hill. A PPA study released in mid-April revealed that almost 70% of PPA members said they vote in “every election possible.” About 10% of members vote every other year, while another 10% vote every four years. The study could increase the power of the PPA should the organization choose to remind elected officials that poker players do, in fact, vote.

Online Gambling Bill Introduced in Michigan

In April, Michigan State Senator Mike Kowall introduced “The Lawful Internet Gaming Act,” or SB 889. The bill green-lights online casino and poker games. According to Online Poker Report, no more than eight licenses will be granted, there’s a $5 million licensing fee, and there’s a 10% tax on gross gaming revenue.

OPR added that unlike New York, there’s a distinct possibility that Michigan partners with another state should the legislation move forward: “The bill doesn’t appear to expressly restrict access to online gaming sites based on a player’s location, opening the door for international and interstate compacting.”