Posts Tagged ‘Passes’

And Then There Were Four…Pennsylvania Passes Online Gaming and Poker Regulations

 And Then There Were Four…Pennsylvania Passes Online Gaming and Poker Regulations

After a frenetic two days of action in the General Assembly, Pennsylvania has joined Nevada, New Jersey, and Delaware in the fraternity of states that have regulated and licensed online casino gaming and/or poker.

As reported by my friend and colleague Dan Katz yesterday, the Keystone State – faced with the end of a legislative session that still had not passed a budget – kicked off on Wednesday when the Pennsylvania Senate acted on HB 271. After debate, the Senate (which had always been more open to expanding gaming in the state) decided by a vote of 31-19 to pass the House bill, putting the onus back on the House to complete a deal that has been in the works for more than 18 months.

Thursday saw another lengthy debate session on HB 271, with many in the House decrying not only the expansion of gaming in the state but also the rushed nature of the nearly 1000-page bill. In the end, the vote went to the ayes for expanding gaming in the state by a tally of 109-72, barely beating the close of the legislative session this Friday. HB 271 now heads to Governor Tom Wolf, who has stated in the past that he will sign the expanded gaming bill and bring several gaming options to Pennsylvanians.

Once Wolf signs the bill, complete online gaming – slots, table gaming and other house banked games – would be offered to the citizens of the state. Online poker will also be offered to the customers as well as daily fantasy sports (DFS). One of the things that was holding up passage of the bill, video gaming terminals in bars and airports, ended up not causing any issues as it was included in the bill. Furthermore, there will be 10 “mini-casinos” allowed to open throughout the state and, should the federal government drop laws preventing the states from doing so, online and live sports betting would be authorized.

When it comes to licensing for business in Pennsylvania, three separate licenses will be offered. The first will be for slot gaming, the second for house-banked games and the third for online poker. The casinos in operation in the state will have the first option as to whether they want to participate in the newly born industry, with a $ 10 million cost for licensing across all three platforms and a $ 4 million licensing fee for each individual product. After 120 days, the industry is opened to outside businesses and licenses will go for $ 4 million.

There are still some issues with the taxation on the different operations, ones that could cut the industry down before it even gets started. A 54% taxation rate on slot gaming might be too big a bite for online operators to even enter the market (although legislators have said the live games are taxed at that rate and online operators will just have to live with it). Online poker is a bit more realistic, taxed at 16%, but that is still higher than neighboring New Jersey.

The debate over online gaming dates to 2015 when legislators, looking to plug budget deficits that have totaled upwards of $ 2 billion, entertained the options of opening for online gaming. It was actually penciled into the budget in 2016, but gridlock in Harrisburg and the reluctance of legislators on both sides to expanding gambling in the state kept the legislation from being passed. With the passage of the legislation on Thursday, Wolf now has 10 days to sign the bill. If he does not sign it, it automatically becomes law and chances of Wolf vetoing the action, especially after the lengthy period that it took to pass the bill, are slim.

If (once?) Wolf signs the bill, then there will be a 90-day period in which the Pennsylvania Gaming Control Board will be accepting licenses from qualified entities in the state. After that period has elapsed, then the next key date would be 120 days after that for accepting license applications from non-Pennsylvania gaming operations. If everything runs smoothly, it is likely that approximately a year from now (if not sooner), Pennsylvania will join Nevada, New Jersey, and Delaware as the only states in the U. S. to regulate online gaming and poker.

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Pennsylvania Senate Passes Online Gambling Bill

 Pennsylvania Senate Passes Online Gambling Bill

Earlier this month, it looked like the chances of online poker legalization were dead in Pennsylvania for the rest of this year as state legislators still couldn’t agree on a budget bill, but sometimes life surprises us. On Wednesday night, the Pennsylvania Senate passed HB 271, a bill which would legalize and regulate online gambling, including online poker, by a vote of 31-19. The bill is now in the House, which was unable to vote on it Wednesday night, but will continue debate on the bill Thursday morning.

We would direct you to the bill to give it a look (follow the link above if you would like), but is nearly 1,000 pages when viewed in Microsoft Word, so good luck and see you next week. As mentioned the bill would legalize online gambling. This includes casino table games like blackjack, internet slots, and online poker. It would also permit for daily fantasy sports and even sports betting, the latter if and only if sports betting is legalized nationally.

This is all well and good, but there is still a big problem: the tax rate on online slots is insane. At 52 percent plus another 2 percent local tax, it will keep most operators from even applying for a license. Supporters of the outrageous tax will say that brick-and-mortar casinos have their slots taxed at the same rate, so online operators should be able to handle it just fine. What they fail to mention or realize is that the land based casinos realize other revenue streams from their guests, like hotel stays, dining, and shopping. Online slots have none of that, only gaming revenue.

The tax rate set by the bill for online poker and table games is 14 percent plus the 2 percent local add-on, which is similar to what we have seen in other states that have legalized online gambling.

Casinos in the Commonwealth will have first dibs on applying for licenses. It won’t be cheap though: $ 10 million for the trio of slots, poker, and table games within the first 90 days of the bill becoming law and $ 4 million each after that period. After 120 days, operators from outside of Pennsylvania can apply for licenses at $ 4 million a pop.

The bill covers lots of other gambling. Online lottery sales would be authorized and special tablet gambling areas would be authorized at certain airports in the state. The bill also legalizes video gaming terminals (VGTs) – think things like video slots and video poker – at licensed truck stops. This has been the subject of heavy disagreement in the legislature, as many lawmakers don’t want gambling to spread too far outside of casinos for fear of abuse and increased competition with casinos.

The House did begin debating the bill Wednesday night, but as mentioned, no vote was taken and debate will continue Thursday morning. It is possible that a vote could happen before the lunch hour, so we’ll keep our fingers crossed that online gambling will finally be legalized in Pennsylvania this week.

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New York Online Poker Bill Passes Senate Finance Committee

 New York Online Poker Bill Passes Senate Finance Committee

It is on to the full Senate for a bill that would regulate and legalize online poker in New York state, as the bill has passed the Senate Finance Committee Tuesday by a 27-9 vote. On Valentine’s Day, the bill passed the Senate Racing, Gaming and Wagering Committee by a unanimous 11-0 vote.

The purpose of S3898, according to the text of the bill itself, is:

To authorize the New York State Gaming Commission to license certain entities to offer for play to the public certain variants of internet poker which require a significant degree of skill, specifically “Omaha
Hold’em” and “Texas Hold’em.”

Straightforward, it is (Yoda…I am?).

The bill is sponsored by Republican State Senator John Bonacic, who has taken up the online poker cause during the last few years. He introduced a bill last year and everything was going well, especially when it sailed through the Senate by a 53-5 vote, but the Assembly never even voted on it.

Bonacic has been confident about his bill this year, telling GamblingCompliance, “Last year, there was too much gaming for the Assembly to consider with fantasy sports and the efforts in New Jersey for a referendum to put a casino in the Meadowlands, and I really think that it got put on the back burner. So now we are putting it in the front burner.”

We won’t bore our readers with all of the finer points of the poker bill, but some of the provisions, as we listed out in February, as well, include:

•    Permits the state to enter into interstate gaming compacts so that player pools can be combined.
•    15 percent tax on gross gaming revenue
•    A maximum of ten licensed operators who must pay a licensing fee of $ 10 million each. Licenses would be good for ten years.
•    Most forms of poker would be authorized, even though the above “purpose” statement only mentions Hold’em and Omaha (that was likely just a simplification, as Hold’em and Omaha are the two most popular forms of online poker – there would be no reason to exclude other forms, like Stud).
•    When and if the bill is signed into law, there will be a 180-day grace period before licenses can be issued and games can start, likely to make sure the state is properly prepared.
•    Operating an online poker site without a license is a crime. Unlicensed operators will be both fined and taxed.

One of the reasons that the bill didn’t get voted upon in the state Assembly last year was Assemblyman Gary Pretlow, who was actually the sponsor of the Assembly’s version of the bill. In a February interview with FIOS1 News’s Andrew Whitman, he said that he was not confident about operators’ ability to prevent cheating. Fortunately, after visiting New Jersey’s Attorney General, he came away impressed and is now “satisfied” that cheating can be prevented as much as is reasonably possible. Pretlow now believes the bill shouldn’t have problems in the New York Assembly, assuming it gets there.

“When I do sign off on something,” he told Whitman, “my colleagues feel that it is a good deal and they don’t question why I made a certain decision. They know that if that decision was made, it’s for good reason. So I don’t really see there’s going to be much opposition to moving this along.”

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Oregon House Passes Bill to Shut Down Portland Poker Rooms

 Oregon House Passes Bill to Shut Down Portland Poker Rooms

A bill that would amend Oregon poker laws to ban the “for profit” industry that has sprung up has passed through the Oregon House of Representatives and now is waiting for the Oregon Senate’s review and vote.

The legislation that would ban Portland poker rooms, known as HB 2190, passed through the House by a prohibitive majority of 39-16. In that legislation, the current laws would be amended to state that only “social” poker games could be conducted and that those gatherings would have to be “operated and controlled by a charitable, fraternal or religious organization” such as the American Legion or Knights of Columbus groups. At this time, Portland is home to a thriving, for-profit industry, with 13 poker rooms that exist in the city limits for the past decade and another seven that are within the county.

Over the past year, the focus of law enforcement has been on the Portland poker scene, looking for violations of the law as it is currently written. Several of the most popular outlets have been targeted by Portland police for employing dealers – the games are supposed to be self-dealt – and, once they were found to be in violation of the law, were fined significant amounts of money and closure for up to two weeks. The new bill, if implemented into law, would completely remove these types of businesses.

When the Oregon legislature passed gaming regulations back in 1973, poker was allowed as “social gaming” in businesses and private clubs. Although there are regulations prohibiting “gambling” in the state of Oregon and after several challenges to the way the law was written, Portland became a thriving hub of poker rooms. Those rooms, however, didn’t open until 2007, and they have become an integral industry in the city.

Now, however, there are opponents that would like to see Oregon (and particularly Portland) tighten up those laws. In the state of Oregon, Indian tribes operate eight different casinos, including the Klamath Tribe, the Coquille Indian Tribe, and the Confederated Tribes of the Umatilla Indian Reservation. Those casinos are losing about $ 10-$ 15 million per year to the Portland poker room industry and, with a strict law stating that only certain organizations can offer poker events, would stand to recoup a great deal of that money.

The tribal casinos aren’t just talking a big game, they are putting the money up to take in the patrons of the Portland scene. In La Center, WA (about 20 miles north of Portland), the Cowlitz Tribe opened Ilani Casino, a state-of-the-art casino in late April. Consisting of 378,000 square feet of entertainment and gaming space (including 2500 slot machines and 75 table games and a 20-table poker room, according to the World Casino Directory. The new casino is expected to draw in 4.5 million visitors per year, employ 1200 people and bring in $ 200 million annually in revenues.

Currently there are no efforts in the Senate regarding the Portland poker rooms, which has saved the industry in the past. There have been efforts for the past four years to close the poker rooms in Portland, but every year they have died due to no corresponding bill to reconcile and send to the governor. Current Governor Kate Brown‘s position on the subject of Portland’s poker rooms and/or the Oregon casino industry aren’t known should a bill come to her desk.

For now, the Portland poker scene is still in existence. The rooms are abiding by the laws as they are written – not charging a rake on players (the players instead pay a fee to play), not paying the dealers (the dealers are tipped) and making their revenues through food and drink sales. Should the Oregon Senate come up with legislation – and should it be reconciled with the already-passed House version of the bill – then the tension regarding the future of Portland poker rooms will ramp up.

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Online Gambling Amendment Passes in Australia, Poker Banned

 Online Gambling Amendment Passes in Australia, Poker Banned

Australian online poker players, welcome to the hell we have had to deal with in the United States. On Tuesday, the Australian Senate passed the Interactive Gambling Amendment Bill 2016, effectively eliminating online poker from the country’s entertainment landscape.

The bill was introduced in November by Australia’s Minister for Human Services Alan Tudge mainly as a way to shore up Australia’s sports betting laws. Sports betting – online and otherwise – has been permitted in the country, but there were severe restrictions on “in-play” sports betting, which is what it sounds like: bets placed on sports contests while those contests are being played. In-play sports betting was allowed, but only via telephone, not online.

With the advent of smartphones, though, offshore operators introduced apps to allow players to place in-game sports bets. They were able to get away with this because they had found a loophole that owed its existence to the law’s vagaries. Smartphones are phones, so in-play bets made with the devices are being placed with phones. Clearly, this is not the intent of the law, but operators still got away with it.

So, that loophole was tightened up, but along with it, other forms of internet gambling were killed. The Interactive Gambling Amendment Bill 2016 bans all forms of online gambling that are not explicitly legal in Australia. Only sports betting is explicitly legal, so poker is now illegal by default.

It is widely believed that it is now just a matter of time before most online poker operators exit the Australian market, a significant one in the industry. Vera&John – a bingo site – was the first operator to ditch Australia in anticipation of the bill back in December. 888poker followed suit in January.

Back in November, Amaya CFO Daniel Sebag said in an earnings call that PokerStars would probably get out of Dodge, too.

“In Australia, we currently offer poker and are reviewing the applicability of proposed legislation to player versus player games of skill,” he said. “At this time, it would appear likely that if the legislation passes, we would block players from Australia. As we do not offer casino sportsbook in Australia, it currently contributes to about 2.5% of our revenues and we estimate it could reduce our EBITDA margin by up to a 150 basis points.”

It is a difficult issue for operators. In some countries, online poker is not explicitly legal, but it isn’t technically illegal, either, so they feel comfortable (or at least not too uncomfortable) offering poker. In Australia, there will be no way to acquire a license, since there is no poker licensing regime, and those who offer poker without a license could face stiff fines.

Even if an operator was willing to risk the fines, it will still probably leave. Take PokerStars, for example. PokerStars has been toeing the legal and perception lines very carefully in countries where it wants to operate. Part of this effort to make sure it is a responsible player in other markets. If it continues to offer poker in Australia, it may not be looked at as favorably in countries like the United States where it is still trying to make inroads via licensing and regulation.

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