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California, New Jersey Continue Intense Discussions On Online Poker Amid Hindrances

Posted on June 22nd, 2010

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California and New Jersey are two states most extremely affected by the economic downturn, with California coping with a $19 billion budget shortfall, while New Jersey is challenged by an $11 billion budget crisis. These two states are also the most insistent in advancing their bills on intrastate online poker despite major obstacles that continue to hinder their bills’ progress. In California, state Senator Rod Wright, D-Inglewood authored a bill on an intrastate online poker system in the state to help solve the state’s budget dilemma. Senate Bill 1485 would authorize the Department of Justice to issue only three online poker licenses to California gaming operators. The three approved sites would be made available to residents of California who would be prohibited from playing on other unlicensed sites.

The bill declares, in part, “The bill would provide that it would be unlawful for any person to play any gambling game provided over the Internet that is not authorized by the state pursuant to this bill. By creating a new crime, this bill would impose a state-mandated local program.” This particular provision is expected to earn criticisms from the public who are keeping a close watch on the development of intrastate online poker in California. A coalition of gaming interests, which said it would study Wright’s proposal, is expected to endorse the measure. The group released a statement that said the establishment of legal intrastate online poker sites that will guarantee safety and security for consumers and provide precious revenue for the state is almost realized in California. The group’s members are: Commerce Casino, Hawaiian Gardens Casino, Hollywood Park Casino, Bicycle Casino and the Morongo Band of Mission Indians.

The bill, though, is facing tough opposition from the California Tribal Business Alliance, an association of casinos and card rooms that claimed the bill would pose a risk to their businesses. In the East Coast, in New Jersey, state legislators are considering putting two questions before voters in the November elections that would allow intrastate online poker and sports betting in the state, if a federal ban on sports betting is repealed. State Senator Ray Lesniak, D-Union is actively leading the movement with the backing of iMEGA, a gaming association of online poker operators.

Last June 3, Lesniak’s proposal was approved by a committee in a 3-1 vote, but the bill’s destiny is still unclear. The 11 casinos of Atlantic City, under the Casino Association of New Jersey, solidly voiced their objections to the legislation last week. Casino Association of New Jersey President Joe Corbo wrote in a public letter that expanding gambling to other parts of the state could be a detriment to the state’s tourism industry. Corbo said the bill’s timing is all wrong since Atlantic City still continues to struggle to revive its sluggish gambling activity. Corbo also expressed distrust for iMEGA and questioned its backing of Lesniak’s proposal. He said iMEGA members consist of offshore Internet gambling sites that are banned in the United States. He said iMEGA had frowned upon the action of the US Department of Justice.

State Senator Jim Whelan, D-Atlantic, who supports the legislation even if a strong opposition from Atlantic City casinos exists, said it’s understandable that the Casino Association of New Jersey would do what’s best for the casinos, just as they, as lawmakers, would also do what’s best for the state. And it’s not all the time that those two agree, he said. Still, lawmakers are hopeful that the bill will be passed. In the following weeks, state legislators will go on with deliberations on the bill at length. California and New Jersey have no plans of holding back their gambling expansion options as they continue to struggle to address their budget problems.