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Poker News | Gambling and the Law

California State Senate Hears Intrastate Poker Debate

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The idea of intrastate online poker was introduced to the California legislature back in 2008, and the various forms of the bill since then have been tabled and put on the back burner until now. It was finally on February 9, 2010, that the State Senate hosted hearings on the subject, despite the fact that there is not even a current pending bill. And the hearing showed that there remains a stark divide between intrastate poker’s supporters and opponents.

Intrastate online poker will allow California to regulate and license online poker operators within the state for the residents of California only. Taxation on the action will allow the collection an estimated $1 billion each year in revenue for a state whose financial struggles become more urgent each year. As education and other vital programs are cut to satisfy a budget that never seems to balance, intrastate poker is an avenue that could be of help, especially in a state where card rooms and Indian casinos are immensely popular and attract customers from all over the world.

After the 2008 bill requesting a study on the issue died in the state legislature not long after its introduction in 2008, the subject was revisited in the summer of 2009 when the Morongo Band of Mission Indians joined efforts with Commerce Casino to bring attention to it. A California Tribal Intrastate Internet Poker Consortium failed to find consensus among the tribes, with the Pechanga Band of Luiseno Indians the most outspoken against intrastate online poker. But Morongo pushed, and with the help of State Senator Roderick Wright, who was also Chairman of the Governmental Organization committee, a hearing was set for February 9. According to Wright, there are 67 Indian tribes, 89 card clubs, and charitable organizations that should have a say in the decision about whether or not to pursue the subject.

The February 9th informal Senate hearing was titled “Examining the Public Policy and Fiscal Implications Related to the Authorization of Intrastate Internet Poker in California” and held in the State Capital in Sacramento. Invited were Indian tribal leaders, representatives of card clubs, poker players, members of the California Gambling Control Commission, internet service providers, and anti-gambling organizations.

The Poker Players Alliance, which has more than 120,000 members in California alone, was allowed to testify, and according to their own press release, the organization’s Executive Director John Pappas said, “The PPA respects the due-diligence of the Committee to investigate ‘if’ online poker can be regulated, and we stand here to tell you that it unquestionably can be regulated, and in fact, already is being regulated, very effectively, across the globe in well-respected jurisdictions.”

PPA California State Director Steven Miller testified, “Given California’s love affair with poker, the PPA and our members feel strongly that if the state decides to go down the path of intrastate licensed and regulated internet poker it must do it with the long-term needs of the consumer and the state and California tribes in mind.”

According to the Sacramento Bee, Morongo Chairman Robert Martin added his support, saying, “We feel the games should be controlled by the tribes and the state - and taxed.”

But the Pechanga Chairman Mark Macarro expressed his opposition, noting that it would interfere with California’s gambling agreement with the tribes. “We simply do not agree with the consequences of authorizing intrastate internet poker,” he said. He went so far as to threaten to withhold more than $42.5 million in annual revenue paid to California should an intrastate online poker bill be passed.

Studies were also presented in the hearing with contradictory results. Former California State Finance Director Mike Genest reported that a recent study, commissioned by the Tribal Business Alliance opposed to any such pro-gaming legislation, showed that online poker could bring in $536 million annually in sales, with $53.6 of it dedicated to the state budget, but it argued that such a business would contradict the aforementioned tribal agreements with the state. But a study by pro-gaming organization Poker Voters of America, offered information that showed that California could bring in $2.7 billion in revenue between 2010 and 2015 should such a bill be passed to regulate the industry.

The next step for intrastate online poker is not known, but it may be in the hands of someone like Senator Wright to draft and submit legislation and put it in the hands of the California legislature for further studies and hearings.

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