California Considering Online Poker Legislation

With Nevada already in the process of legalizing online gaming and New Jersey indecisive on which path to take, the poker world has now laid eyes on California. The biggest of all 50 states, California is also in the crossroads of making the big decision. The state casino owners are intensively lobbying for the SB 1463, also known as the Steinberg-Wright bill, which would legalize online poker in California - reported by the LA Times.

The bill would allow Indian casinos, card clubs, and horse-racing tracks to run online gaming operations provided that they pay a $30 million fee for a 10-year license to provide online poker services to state residence. Should the bill be approved by the lawmakers, it would allow the future expansion of gambling activities including Pai Gow and 21 to join the list in two years.

The coauthors of the bill, Sen. Roderick Wright (D-Inglewood) and Senate leader Darrell Steinberg (D-Sacramento), claim that the purpose of the bill is to gain the needed revenue for the state's social expenses as well as protect online poker players who are now playing on offshore internet poker sites and have no protection against fraud.

“Today, the state of California is the leading Internet gaming market in the world,” Sen. Wright said in a USC conference on gambling back in March. “The only thing is, we make no money and we have no [consumer] protections for our citizens who play.”

If the online gaming bill is approved, it would allow California to raise at least $200 million in revenue per year, Senate leader Darrell Steinberg declared. He said that the only reason for the internet gaming legislation to pass is to “generate significant revenue for the state.”

The California Online Poker Assn., a group of 46 casinos operating in the state calculated that an approximate number of 2 million Californian residents are currently engaged in online poker activities. If the online gaming bill is passed, they would be able to play on legal and regulated poker sites generating tax money for state schools and social services.

However, the state of California is not going to be the top beneficiary if online gaming is legalized. According to the L.A. Times, a number of casino operators have donated millions of dollars to the Democratic State Central Committee of California and to Sen. Roderick Wright himself. Thousands of dollars were spent on political contributions, gifts and lobbying in the past two years. It was in 2010 when Sen. Wright first proposed online gaming legislation and since then casinos joined the ranks of the most generous Democratic supporters in California.

Unsurprisingly, not all casino operators and gambling business groups approve of online poker legislation. The California Tribal Business Alliance (CTBA) which represents three Indian tribes running casinos in the state argues that the new bill would violate their rights as exclusive providers of some electronic games.

“This is … a harsh slap in the face to California Indian tribes,” the CTBA chairwoman Leslie Lohse said. On their part, the Alliance had donated almost $300,000 to Gov. Jerry Brown's campaign to increase the taxes in order to reduce the budget gap. Such measure could prevent the need for online poker legalization.

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