Two Big Steps for Online Poker in U.S.July 11th, 2016 by Todd McGee
Are we getting closer to regulated online poker in the United States? State legislatures in Pennsylvania and California, two of the nation’s most populous states, have recently taken steps forward in legalizing and regulating online poker. Currently, Nevada, New Jersey, and Delaware are the only states that offer regulated online poker to citizens who reside within those states.
In late June, the Pennsylvania House of Representatives passed H2150, which legalizes and regulates online poker, by a fairly wide margin of 115-80. The vote came after the bill had initially been defeated because it contained a controversial provision that legalized slot machines. Once that provision was removed, it was brought up for another vote and passed. The measure still has to be approved by the state Senate and the governor.
The Poker Players Alliance has been working with several state legislatures to make online poker legal. PPA Executive Director Rich Muny hailed the vote in Pennsylvania.
“This legislation is long overdue,” he said. “Pennsylvanians deserve robust consumer protections and today the Pennsylvania House delivered. Additionally, this legislation will create jobs and help the Commonwealth close its budget gap. This commonsense legislation is a win-win for Pennsylvania. The online poker community urges the Senate and Governor Wolf to act swiftly to approve this measure.”
The bill attempts to establish “an effective regulatory, licensing and enforcement system for interactive gaming … (to) inhibit underage wagering and otherwise protect vulnerable individuals, ensure that the games offered through the internet are fair and safe, stop sending much-needed jobs, tax and other revenue offshore to illegal operators, provide a significant source of taxable revenue, create jobs and economic development and address the concerns of law enforcement.”
Also in late June, a legislative committee in California passed a similar bill (AB 2863). The California Assembly (i.e. House of Representatives) Appropriations Committee passed the legislation 14-1 and sent it to the full Assembly, where it has not yet been scheduled for a vote. Companies looking to host online poker games in California would be required to pay a one-time $12.5 million fee for a license. Given that even the regulated sites in New Jersey are only averaging about 500 players per day, according to Pokerscout.com, you have to wonder which company would pay that kind of money for a license.
I’m not a lawyer, but it looks like Nevada charges an upfront fee of $500,000, which covers the first two years of operation, then charges an annual renewal fee of $250,000 per year after the initial license expires. The state also requires operators to contribute $250,000 annually to combat problem gambling.
It appears New Jersey charges an initial fee of $400,000 and an annual renewal fee of $150,000. Operators must also pay a $250,000 annual fee each year to help fund responsible gaming programs operated by the state.
While the news in Pennsylvania is particularly promising, regulated online poker in the U.S. is still a long ways out. I live in North Carolina, the home of Harrah’s Cherokee Casino, which opened in 1997. The property is one of the most popular stops on the WSOP Circuit, hosting events in the fall and spring each of the past two years.
It took many years and a concerted effort by the Cherokee tribe – not to mention threats from the federal government before the state allowed table games in the casino in 2011. There has been absolutely no talk at the state level of regulating online gambling or daily fantasy sports. Maryland is home to the Maryland Live! Casino, which has one of the more robust poker rooms in the nation. Yet there have been very few discussions within the Maryland legislature about regulating online poker.
Still, you have to start somewhere, and if Pennsylvania Senate approves the bill, it’ll be another in the series of small steps that has to occur before regulated online poker comes to the United States.