Time Runs Out for Online Poker Bills in California

Posted on by Tim Hernandez

CaliforniaAny chance of legislation to regulate online poker in California in 2015 died on Friday when the legislative session for the Golden State came to a close.

Although there was no expectation of eleventh-hour movement for any of the online poker legislation introduced this year, the closing of the legislative session was significant inasmuch as it brought to an end another year of hope for advocates of regulated online poker.

Four online poker bills were introduced during the course of the year – Adam Gray´s “shell bill” AB431 the only one to progress out of committee stage after a massive climb-down in the language of the bill to appease the Pechanga and Agua Caliente tribal nations opposed to the involvement of PokerStars and the racetracks.

Gray´s proposals also passed a second procedural stage in May, but only after Republican members of the Appropriations Committee abstained from voting. Subsequent hearings to pad out the content of AB431 were cancelled due to remaining divisions between the stakeholders and, in early June, the chairman of the Senate GO Committee – Senator Isadore Hall – admitted that there was no momentum to carry the bills forward.

Was Anything Achieved in 2015?

Not really. Since the San Manuel Band of Mission Indians left the California Tribal Business Alliance to join the pro-PokerStars coalition in November 2014, the only movement of any significance was a proposal by the Pechanga Tribe to consider revenue sharing with the racetracks – a proposal fiercely rejected by the horseracing industry.

Despite the highly-publicized GO committee hearings, PR campaigns by PokerStars, extensive media coverage and an overwhelming amount of lobbying by the various stakeholders, the lack of consensus remains a huge issue. In fact it would be fair to say that the divisions between the interested parties are deeper at the end of the year than they were at the beginning.

Accusations of an ambush at the Annual Western Indian Gaming Conference in February and claims that the involvement of Assemblyman Gray and Senator Isadore Hall was politically motivated and neither had any intention of allowing i-poker legislation to pass did not help the process – nor did the pitches for money by the Department of Justice´s Bureau of Gambling Control and the California Gambling Control Commission at the GO committee hearing in May.

More of the Same in 2016?

Despite Mike Gatto – author of the first proposed online poker bill – stating that he could not see legislation being passed to allow online poker in California for the next three years, Adam Gray has said that he will be re-introducing his bill early next year. From what little he achieved this year with his shell bill in 2015, and considering the deeper divisions between the stakeholders, there is no reason to believe that he will be any more successful in 2016 than he was in 2015.

Furthermore, Adam Gray used the last day of the legislative session to introduce a new bill into the mix which proposes the licensing and regulation of daily fantasy sports. The “Gambling: Internet Fantasy Sports Game protection Act” (AB1437) is fairly similar to Gray´s online poker proposals inasmuch as it is light on detail. Other than defining what Daily Fantasy Sports is and proposing that licensing should be conducted by the California Department of Justice, nothing is mentioned about licensing fees or tax rates.

As the regulation of Daily Fantasy Sports will not have to contend with fighting between stakeholders, it is likely that Assemblyman Gray´s attentions will be more focused on passing the easier of the two options. As the racetracks do not care whether or not online poker is regulated (We´re alright without it but we want to be involved if it´s there), and the Indian Tribes opposed to PokerStars saying they would rather have no law than a bad law, there does not seem to be much momentum at all towards the regulation of online poker in California.

Advocates of regulated online poker should expect another year of dashed hopes!

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