Online gambling legislation hitting snags across the U.S.

Jun 21, 2012 |
The arrival of summer, the glacial pace of change in state politics, the usual array of anti-gambling forces, and a variety of local issues have combined to slow the pace of online gambling legalization in the United States.

The tailwind provided by the Dept. of Justice’s Wire Act ruling last December has dissipated, and now pro-gambling forces are starting to look toward late fall and possibly 2013 as estimated arrival time for bills in several states – Iowa, Massachusetts, New Jersey, California among them.

It’s hard to determine exactly why momentum has slowed in states’ bids to legalize play on the Internet. Just about every state is now trying to figure out ways to balance its budget and income from tax gambling revenue would at least staunch the bleeding a tad as the economy recovers ever so slowly from the 2008 Great Recession.

“The states are still where the action is,” noted Gaming Law Review co-editor Joseph M. Kelly at the recent Canadian Gaming Summit in Niagara Falls, Ont. “I believe that Nevada [which has already enacted legislation and is now approving licenses], Massachusetts and the Virgin Islands will soon have online play. We all know that given the climate in Washington, don’t expect anything on the federal level.”

And it’s probably a good idea not to get hopes too high anywhere else, at least until after the elections in November.

No luck in New Jersey

New Jersey once appeared to be a lock. The Atlantic City casinos have been bleeding red ink for close to half a decade now and bills to allow casinos to host portals for online play has been kicking around the legislation for months. But one that was passed more than a year ago was surprisingly vetoed by Gov. Chris Christie, and while a new package got approval from an Assembly committee several days ago, few expect any action for months.

Christie may be a different kind of politician, but he’s still a politician. He appears spooked by a recent Fairleigh Dickinson poll in which more than 50 percent of the state’s resident had concerns about legalizing online poker and casino games.

With Christie apparently off the reservation as he spends the summer and fall trying to get anti-gambling candidate Mitt Romney elected president, the bill’s sponsor, Raymond Lesniak, conceded that it would be fruitless to fight on in July and August. Lesniak, who hangs on with the ferocity of dog with a steakbone, vows to re-visit the issue in the fall.

“After the election,” Kelly said, “the chances are much better that Christie will support it.”

Cold feet in California

In California, state Sen. Rodney Wright (champion of efforts to legalize sport betting) also was forced to smell the coffee when his online poker bill was brought before the Governmental Organization Committee. The same panel that had OK’d a sports betting bill several weeks ago apparently was in a foul mood regarding online gambling, because Wright (who is the committee chairman) pulled the bill from discussion after he sensed bad vibes. It was the only option available to backers hoping to keep the bill alive, and SB1463 – which has already been amended several times – is looking at more changes.

“It looks like in California that there are too many groups suspicious of each other,” Kelly said at the Canadian conference. “There are a lot of complications there,” he added, referring to the myriad tribal interests and card rooms that are concerned about the impact that online gambling will have on bricks-and-mortar properties.

Other States of no play

And on it goes.

Efforts in Mississippi appear to have been derailed by anti-gambling groups.

Florida is a mess as politicians try to figure out whether they want to end tribal dominance over gambling in the state.

Iowa Senate leader Jeff Danielson took one step forward, but then was beaten back when his online legislation couldn’t make it to the governor’s desk.

All of which must be producing smiles, handshakes and backslaps in Nevada, the only state where solid progress appears to having been made and regulators have unanimously recommended that Bally Technologies be issued the first-ever license to manufacture online systems. The Nevada Gaming Commission was scheduled to discuss the issue on Thursday (June 21), but there is no word on when it would actually issue a license, assuming everything goes smoothly.

Yet even in Nevada, where online play could be up and running in a matter of a few months, play would be limited the state’s fewer-than 3 million residents, hardly a large-enough pool to produce mega-profits and significant tax income. The big fish are on the coasts, and they appear to be in no hurry to move.

So we wait.

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