California iPoker Bill Stalls As DFS Bill Advances

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Friday, January 8th, 2016 | Written by Charles Washington

Poker advocates in California have received a huge blow to their aspirations of seeing online poker regulated in the state, after bill AB 167 was removed from the agenda of the Assembly Governmental Organisation Committee. At the heart of the latest debacle is an attempt by Californian gambling interests to see both the state’s racetracks operators, as well as PokerStars, excluded from any future Californian iPoker industry. Conversely, daily fantasy sports enthusiasts had cause for optimism after the very same Committee passed bill AB 1437, in the process making California the first state to move DFS legislation forward through a legislative vote.

iPoker Bill Stalls

Assemblyman Reginald Jones-Sawyer introduced online poker bill AB 167 back in February of 2014, with the piece of legislation proposing that all online players should be located within state borders, and be aged at least 21. Online operators would then be expected to apply for a four-year long iPoker license costing $10 million, with 8.5% of their gross gaming revenues subsequently collected by the state by way of taxes.

AB 167 is not the only iGambling bill floating around the state. AB 1441, for instance, deals with sports betting, while AB 1437 aims to regulate daily fantasy sports in California. Nevertheless, the decision by the Assembly Governmental Organisation Committee to pull the bill from its hearing has attracted criticism from various quarters.

It has been estimated that a potential California online poker market could be worth as much as $380 million by the time it reaches maturity. Nevertheless, California’s Indian owned casinos, cardrooms, racetracks and other gambling interests have been unable to resolve their differences concerning who should be allowed to operate online poker sites, and whether PokerStars should be invited to become a part of that industry. As a result, the drive towards online poker regulation has been dragging on for more than 7 years in California, with no tangible progress made to date.

DFS Bill Passes Out of Committee

While iPoker legislation efforts stalled once again, California has moved a step closer to regulating its daily fantasy sports industry after the Adam Gray (photo) sponsored bill, AB 1437, passed a vote in the Assembly Governmental Organisation Committee, with only one dissenting voice raised in opposition. It is worth noting, however, that this is just one tentative step on the journey towards regulation, and the bill must next progress through the Appropriations Committee, before eventually being put in front of the full Assembly.

The Case for DFS Regulation

As well as being the bill’s sponsor, Assemblymember Adam Gray is also the committee chairman, and forwarding his argument on the issue of DFS legislation explained that Californians are continuing to play on offshore DFS sites, and that regulating the industry would help “ensure consumers are playing on websites that provide comprehensive consumer protections”.

Whilst agreeing with his argument, other members of the committee still took the opportunity to put forward their own chief areas of concern. Ken Cooley, for instance, questioned whether the UIGEA language used in the bill was the most appropriate for a game which could be considered a lottery under Californian law, while Frank Bigelow drew attention to whether allowing DFS beyond the state level would breech federal laws. While most acknowledged that the incomplete bill needed more working on, the overall feeling of the members was neatly summed up by Vice chair Eric Linder, who said:

“I think there’s a lot we need to get right moving forward, and I am prepared to support this bill. I think we do need to be incredibly thoughtful, making sure it meets the constitutional requirements.”

Indian Tribes Once Again Protest

Just like online poker, any advancement of DFS legislation is bound to meet stiff resistance from California’s Indian Tribes, and other invested parties. This group of powerful gaming interests have already expressed reservations about seeing DFS legislation advance ahead of iPoker, and as Steve Stallings, chairman of the California Nations Indian Gaming Association (CNIGA), said about the issue:

“AB 167 represents one of the last in a series of I-Poker bills, which, unlike AB 1441 and AB 1437, were thoroughly vetted, debated, altered, massaged, and continually passed over with the hope of a political miracle of consensus in the next year. The regulation of fantasy sports is well intended; however, the state needs to prove it can deal with one online game – I-Poker – before it takes on others.”