Democrat Assemblyman Reginald Jones-Sawyer last week introduced a second bill to legalize iPoker in California. Jones-Sawyer played a role in last year’s near-miss for iPoker and understands the necessity to include all gambling entities in the state, so he has added the racetracks to his bill.
Under AB 167, participants —“qualified card room, horseracing association or federally recognized California Indian tribe”—would be required to pay a $10 million license fee and an 8.5 percent tax rate.
Joe Morris, president of Thoroughbred Owners of California, said the industry wants to be involved.
“We want a seat at the table, on a level playing field,” Morris said. “If there are licenses out for sites, we want a site also.”
Assemblyman Mike Gatto introduced an earlier measure, AB 9, which was similar to previous online poker bills, but with some significant differences. Since he first floated the bill, the chairman of the committee that is in charge of gaming has been consulting with stakeholders, and has introduced some amendments as a result.
One part of his bill that drew considerable criticism was the requirement that players had to physically show up at a casino or card room to register to play online. That requirement has been withdrawn. Gatto stated, “After meeting with security experts and hearing from poker players and industry professionals, I have concluded that online poker would be best served by making in-person registration an option rather than a requirement.”
The bill retains the option of registering at a brick and mortar casino. Gatto is also considering a requirement that an annual poker tournament be held at existing casinos that operate out of physical buildings.
Like Gatto’s bill, the Jones-Sawyer measure contains a controversial section—“bad actor” clause that is aimed at preventing PokerStars from participating.
This is a deal breaker for several card rooms and Indian gaming tribes, because one consortium of pro-online poker supporters consists of major Indian gaming players who have partnered with PokerStars, which was recently purchased by Amaya Gaming.
The prohibition against “bad actors” in AB 167 has been largely eliminated, a provision that encourages potential PokerStars partners.
“The fact (AB 167) has softened the bad actor language goes a long way” in getting coalition approval, Martin told Dave Palermo, writing for Pechanga.net.
But the other side is not amused. A statement was released by Marc Macarro, chairman of the Pechanga Band of Luiseño Indians, leader of a coalition of 13 tribes opposed to any participation by PokerStars.
“We are disappointed that the bill disregards important principles from a broad coalition of respected tribes and card rooms that help prevent corporations and entities that previously violated federal law from profiting from tainted software, brands, and databases derived from illegal activity,” he said.
Gatto has added a provision that might allow PokerStars to apply if it meets certain requirements. Gatto told OnlinePokerReport.com, “We want to make sure that groups who are authorized to participate in online poker all have the same chance, particularly those who were very careful to do everything right and who were very careful to adhere to every policy that existed before.”
Gatto says he remains open to amendments to his bill. “The status quo is a lost opportunity,” he said last week. “Californians already participate in online poker, but send their dollars overseas. By regulating and legitimizing this industry we will increase security, protect business owners, and keep our money here in the Golden State.”
He told OnlinePokerReport, “I am under no delusions, nor should anybody else who doesn’t follow the legislative process be under any delusions, that my bill is a final product. This is an opening statement, it’s a discussion point, it’s putting some language across the desk – but procedurally, this will go through a very, very thorough public hearing process.”
To push offshore operations further to the margins, Gatto says he is contemplating an amendment that would make it a felony to offer real money games to California residents without a license.
Macarro is also opposed to participation by racetracks. Tribes fear that expanding gaming to the racetracks could threaten their gaming exclusivity in California.
“Tribes have been steadfast in the principle that online poker be consistent with California’s longstanding public policy of limited gaming, and that means keeping it to just tribes and card rooms.,” he says. “California voters have always had the final say on gaming expansion and they have already rejected expansion of gaming for horse racing.”
Gatto said he was uncertain about whether he would add racetracks to his bill.
“It’s not a simple, straight-forward issue,” he told Palermo. “What I can say is I worked at the race tracks. I know it is a very, very important, historic industry in California.
“But I talk to my friends with the tribes who remind me they have in the California Constitution an exclusive right to operate many different kinds of gaming. We have to make sure that we respect the Constitution with what we do legislatively.
“It really is a tightrope.”
The Jones-Sawyer bill isn’t likely to be the last submitted in the legislature. It is expected that Senator Isadore Hall will file a bill in the Senate, where he’s the leader of a committee that will consider any iPoker bill.
