Horseracing Industry Offers California Poker Bill Unbridled Support

California racetracks support online poker bill

The race for online poker in California may have stalled but the racetracks acceptance of Gray’s bill is a major hurdle overcome. (Image: mysoutherncalifornia.com)

California’s horse racing industry has officially thrown its weight behind Assemblyman Adam Gray’s online poker bill (AB 2863). Nine industry leaders wrote to Gray last week to pledge support for the bill, which is due to receive a hearing of the California’s Assembly Committee on Governmental Organization on Wednesday.

And well, they might. In its current form, the bill would exclude the racetracks from participation in a future online poker market, for which the industry would be compensated to the tune of $60 million per year when, and if, online poker gets up and running in California.

Support for the bill is dependent on several key elements, according to the letter. First, the $60 million stays. And it should be considered a “baseline number.” The industry is not prepared to negotiate on this, the leaders said.

$60 Million Buys Industry Approval

The letter also notes that the tax rates have been left blank in the bill, although 15 percent plus a $15 million licensing fee had been mooted in an earlier draft. Since the $60 million fee is to be solely funded by license fees and taxes, said the letter, the fees, and tax rates need to be decided upon so the industry can assess the likelihood that the $60 million will be available.

“Our continued support for the legislation is predicated on the ultimate reasonableness of those numbers,” it emphasized.

“On a related point,” it added, “we believe AB 2863 should be amended to confirm that in the event the $60 million minimum was not fully funded in a given year, there would be a carry over into the following year(s) with first dollars from future i-Poker license fees and tax revenues going to cure the deficiency.”

Pechanga Demands Amendment

The racetracks’ support for the bill, and acceptance of their own non-participation could be a dramatic breakthrough. Many tribal operators have been steadfastly opposed to the horseracing industry’s inclusion in the market, and the various stakeholders’ inability to agree on who should be eligible for licenses has been a major barrier to the success of previous bills. The horseracing industry’s letter of support is a big compromise and potentially a major hurdle overcome.

Division remains, of course, between the Pechanga and Morongo coalitions. The latter wants to see an inclusive market and one that would not exclude PokerStars, with whom it has a commercial agreement while the Pechanga tribe and its allies wish to retain the “bad actor” language of bills past.

Last week it emerged that the bill had been amended at the behest of the Pechanga collation to contain impartial language on suitability standards for prospective licensees. The amendment permitted the coalition to adopt a neutral stance on the bill rather than one of opposition.

Philip Conneller
Written by
Philip Conneller
As part of the team that launched Bluff Magazine back in 2004, and then as Editor of Bluff Europe, Philip Conneller has (probably) written thousands of articles about poker and has travelled the globe interviewing the greatest players in the world, not to mention some of the sexiest celebrities known to man in some of the world’s sexiest destinations. The highlight of his career, however, was asking Phil Ivey (as a joke) how to play jacks, and emerging none-the-wiser. Philip once won $20,000 with 7-2 offsuit. He has been told off for unwittingly playing Elton John’s piano on two separate occasions, on different sides of the Atlantic Ocean. He became a writer because he is a lousy pianist. He lives in London where he spends his time agonizing about Arsenal football club, yet in Wenger he trusts.

Comments

dj11 wrote...

I think any whole OLP industry would be better served, individually (any and all entities) , if they drop the $60 mil and let Horse Racing tracks try to compete.

According to this; http://s.giannini.ucop.edu/uploads/giannini_public/d3/8d/d38dafc0-a55c-4cfe-a315-9996a828b0c8/342-thoroughbreds.pdf

The stats for the statewide Horse Racing Industry show way less than 10,000 total positions created by the Horse Racing industry.

And that was in 1989!

Hollywood Park has closed since then, and I imagine several others.

If that $60mil were divvied up evenly over the 3500 people the report shows, that would be in the range of 17K per person per year, but we all know it would not be divvied up evenly.

I don’t like it. I don’t like the idea that poker players will be subsidizing a dying industry, to the point that eventually, they will not be subsidizing it, but will by law become the major financial source for a dead industry.

I would prefer the field be open, let the Racing industry try to compete. I don’t think they can.

dj11 wrote...

While we all want to think there could be $60 mil left over once OLP is anchored in Ca. we really have no idea that it will make enough to cover the $60. If it can’t who gets stuck with the bill? Players. In the form of rake or tourney fees so big that no one partakes of the game online.

Come on Tribes and Casino’s you can work this out to make everyone happy. Just consider that if 7-11 wanted in (by law), what would you do?

Try considering the problem from the players POV. Players want accountability, consumer protections, and variety, a consistent set of rules for the games, and some recourse when things don’t go according the Hoyle.

The HRA’s biggest argument for being involved might be their history with moving money via betting. Well, check cashing businesses do that on a bigger scale. Gonna let then get in too?

I give thumbs down to this version.

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