Recent Developments Towards Legalizing Online Gambling In California
For California, it’s just a matter of time, though the state legislature has grappled with legalizing online gambling for years. California Senate Bill 51 (SB 51) is the most recent attempt. Known as the Internet Gambling Consumer Protection and Public-Private Partnership Act of 2013, SB 51 would establish a framework to authorize intrastate Internet gambling in California, including Internet poker, specifically authorizing Internet gambling through licensed websites. Two other bills have been announced as well, including the Authorization and Regulation of Internet Poker and Consumer Protection Act of 2013, SB 678, which in essence would allow California gaming companies to legally offer online poker gambling. The bill sets the legal minimum age to play online poker at 21, and provides financial safeguards to protect player funds. The bill does not address any other type of online gambling other than online poker.
Assemblyman Adam Gray has sponsored multiple bills relevant to online gambling in California. Two of them are sports related, AB 1437 and AB 1441. The first one, AB 1437, titled as the Internet Fantasy Sports Game Protection Act, was passed through for consideration by the California House committee on Appropriations. After lengthy discussion and debate, the measure was passed in January with only one opposing voice from Marc Levine. Levine has been openly opposed to DFS since its emergence in the US market. Gray’s second sports related bill, AB 1441, is related to the legalization of legal sports betting in California. This bill was pulled from the agenda and shelved for the time being. AB 1441 has a lower priority because it can only take affect at such time as the Professional and Amateur Sports Protection Act (PASP) was either modified or rescinded. A hearing date has not been scheduled for AB 1441.
Assembly Bill 2291 was one of the earlier online poker bills introduced in California. It was introduced in by Reggie Jones-Sawyer and called the Gambling Control Act of 2014. The bill never received a hearing however, and has been shelved since the fall of 2014. When AB 2991 was introduced, a competing bill was also introduced as SB 1366, the Internet Poker Consumer Protection Act of 2014. The simple fact that there were competing bills relevant to online poker demonstrated that there were conflicting points of view regarding interactive poker regulation and that the state was perhaps not ready for a unified approach to the emergence of online poker gambling within its borders.
Fast forward a few years and another one of Adam Gray’s gambling bills, AB 2863 was recently passed through the Assembly Appropriation Committee. The bill will regulate and legalize online poker in California. Several amendments were added to the bill before the vote to address tainted assets and bad actors, two elements that still require additional modification before final passage is possible in the Senate. Some of the issues still being questioned in the bill include the $20 million fine for any gambling companies that provided online betting services to California residents from 2006-2011. Some individuals feel the fine is too small and that offenders can afford to pay significantly more. Another issue is the addressing of tainted assets and any unfair advantages those may bring to certain parties. The bill has the support of the Poker Players Alliance.
The last bill that is in motion but has not yet been brought forward is known as the Internet Poker Consumer Protection Act of 2013, and is sponsored by eight California Indian tribes. It would legally permit operators of California reservation casinos and commercial card rooms to provide online poker to residents and visitors who are physically present within the state of California during the poker gaming session. This bill requires the state to opt out of any federal legislation that may pass in the future concerning online gambling. It also rules out any opportunity for interstate compacts, restricting the gambling scope to intrastate only. Many industry professionals feel that the sheer size of the population of the state would ensure that the online poker infrastructure could be self sustaining and not require any additional contributions from players outside of the state.
Passing any of these bills would result in the creation of specific CA online gambling laws and genuinely address the topic head on. In addition, there have been several recent attempts at passing federal legislation, however unsuccessful thus far. Online poker players will be closely watching the outcome of these legislative proposals to see what actually ends up taking hold and becoming the law of land in California.
Reasons Why Legalizing Online Gambling Would Be Beneficial For California
The level of debt that California faces is no secret to anyone, and at this point, the why and how of what got them into this financially dire situation is irrelevant. Attempts to tax businesses to death for additional revenue to provide some relief has done nothing more than cause them to exit the state and decrease California's tax revenue even further. Online gambling may just be a way to get the state budget out of the red, or at least headed in that direction. The revenue that the state could bring in from licensing fees, operator taxes, player taxes, and other regulatory related revenue could be in the billions of dollars, something that could benefit the state greatly right now as they desperately struggle to manage the their expenses. This extreme deficit in the state budget may be enough motivation to get lawmakers in the state to finally agree and come together to get a bill passed that will open the doors to online gambling for residents of the Golden State.