West Virginia On Verge of Being Fifth State to Regulate Online Poker

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West Virginia poker players could be playing regulated online poker by year's end.

West Virginia is one Governor’s signature away from becoming the fifth state to legalize online gambling in the U.S.

The West Virginia Senate passed measure HB 2934 by a 26-7 vote Friday. The measure, officially known as the West Virginia Lottery Interactive Wagering Act, would legalize online gambling – including online poker – within state borders and offer the state’s five land-based casinos the opportunity to expand into the online market.

HB 2934 has now passed in both the state House and Senate by a wide margin, after getting through the House by a landslide 72-22 vote in February. The West Virginia Senate made minor amendments to the bill, which as a result now needs to go back to the House for concurrence.

TO THE GOVERNOR’S DESK

If the House concurs as expected, the bill would then go to Gov. Jim Justice for final approval. If the Republican governor signs off on the bill, West Virginia would join Nevada, New Jersey, Delaware, and Pennsylvania as the fifth U.S. state with legal, regulated online gambling.

The bill could also pass if Gov. Justice allowed HB 2934 to become law without his signature, as he did after the House and Senate passed a bill legalizing sports betting in March 2018. In either scenario, the WV Lottery Interactive Wagering Act would go into effect 90 days after passing.

Only a last-minute veto from Justice would derail the bill. This was, unfortunately, the case in Michigan at the end of 2018, when that state’s proposed online gambling legislation passed through both the Michigan House and Senate by wide margins, only to be vetoed by outgoing Gov. Rick Snyder just days before his term was about to end.

FIVE CASINOS ELIGIBLE FOR INTERACTIVE GAMING LICENSE

West Virginia’s five land-based casinos would be the only operators eligible for interactive gaming licenses if the measure does pass. An interactive gaming license allows a casino to offer both poker and other casino games online, and anyone over the age of 21 can play as long as their located within state borders while playing.

The language of the bill dictates that a total of five permits are available state-wide, and only to casinos already operating with a land-based license. Each casino can apply for a five-year interactive gaming license at a cost of $250,000, with a $100,000 renewal fee payable every five years.

The state’s five casinos include:

  • The Casino Club at the Greenbrier
  • Hollywood Casino at Charles Town Races
  • Mardi Gras Casino & Resort
  • Mountaineer Casino, Racetrack & Resort
  • Wheeling Island Hotel

U.S. ONLINE POKER CONTINUES TO EXPAND

Will prominent poker brands like PokerStars, 888Poker/WSOP and partypoker set up shop in West Virginia, as they are in Pennsylvania?

The state’s five casinos could partner with some of online poker’s biggest operators for the poker portion of their online gaming offerings if the progression of the online poker market follows the path of the state’s sports betting industry.

FanDuel, DraftKings, William Hill and Miomni are all partners with the five casinos in various combinations in operating the state’s legal sports betting offerings.

The recent Department of Justice reversal of opinion on the Wire Act effectively shuts down any hopes of merged player pools across state lines in the U.S., which means operators would have to offer stand-alone poker clients available only within the state’s borders, if they elect to operate in the Mountain State.

PokerStars signed into an agreement with casino operator Eldorado Resorts in November 2018, with the intention of offering online poker in the 11 states in which Eldorado Resorts owns properties, when and if those states legalize online gambling.

West Virginia is on that list of 11, as Eldorado owns the Mountaineer Casino.

OUTLOOK FOR ONLINE POKER IN THE U.S. IN 2019

Pennsylvania’s prospected online operators suffered a setback with the DOJ reversal of opinion, as the unexpected January announcement forced the state’s seven approved casinos and their poker technology partners to take a step back and re-configure their upcoming products in the Keystone State.

The opinion, which ruled that any interstate transaction involving gambling is illegal, put an end to the prospect of shared interstate player pools for PokerStars and Partypoker, each of which could have added the PA player base to their already existing New Jersey player networks.

888Poker/WSOP already has a merged network among its sites in Nevada, New Jersey and Delaware, and was slated to add Pennsylvania to the mix and create the largest player pool for a legal, regulated online poker network in the U.S. The PokerStars agreement with Eldorado Resorts was struck with the idea of an eventual merged PokerStars USA network in mind.

All of the hopes for merged player pools have to be put on hold, at least for now. The good news for players in West Virginia is that the state’s casinos can start building their poker products with the DOJ opinion already in mind, and therefore avoid the delays experienced in Pennsylvania.

Pennsylvania’s online gambling platforms were expected to launch in early 2019, but the DOJ opinion has caused the launch to be pushed back to June/July.

West Virginia’s online gambling brands could be up and running by the end of 2019, and if no other setbacks happen in Pennsylvania, the U.S. will have five states offering online gambling and poker by the end of the year.