Pennsylvania Could Be A Catalyst For iGambling Expansion

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Tuesday, September 27th, 2016 | Written by Shane Larson

2016 was originally predicted to be a big year for online poker in the US, with legalization expected to have been adopted by a number of states across the country. This year’s third quarter is now almost complete, though, without a single state having added its name to the roster.

While New York managed to get an iPoker bill through their Senate, it ended up reaching a dead end after NY Assemblymen allowed it to die over concerns about poker being a game of skill, and the possible potential for cheating. In the meantime, California remains stuck over whether PokerStars should be allowed to shed its “bad actor” label and become involved in the industry, and in Michigan, the issue seem to have been delayed due to the focus of its lawmakers on the November elections.

So is there any hope at all of 2016 closing out with at least a fourth state joining the country’s other three regulated markets? While time is running out, the Keystone State may still provide the best possibility.

Hopes High in Pennsylvania

Pennsylvania has been considering online poker legalization for awhile, and the state seems to be poised to move on the issue. It’s not just conjecture, either, as the state budget passed in Harrisburg and signed by the Governor includes a revenue line of $100 million from online gambling; the state is hoping to use the money it will make from legalization to fill government coffers and thus avoid having to raise taxes.

With the state having put revenue predictions in its budget, it will feel compelled to take action lest it end up falling short of funds. All being well, this should put end to the 3-year struggle to bring online poker to Pennsylvania.

Pennsylvania a Game Changer

If and when Pennsylvania passes online poker legislation, it will likely have a number of positive effects on the industry, including:

– Remove the Stigma of Poker. The more states allow for legal online poker, the more legitimate the industry becomes in the eyes of the public. Pennsylvania can help the situation by breaking down some of the negative perception associated with the game, especially the notion that online poker legalization leads to sharp rises in gambling addiction. These any other perceived problems have kept other states from exploring iGaming legislation, but with Pennsylvania’s lead we might even begin to see calls for a nationwide federal law allowing for legalized online poker.

– Improving Liquidity in New Jersey. Most experts believe that New Jersey will seek to establish an interstate compact with Pennsylvania and pool their poker players together, meaning that players in the Garden State will benefit from improved liquidity. Furthermore, a compact would enhance the player experience in New Jersey and hopefully give its slow-growing iPoker industry a boost.

– Cause a Ripple Effect. We’ve seen with other types of legalization issues that whenever one state makes a move, others follow in their footsteps, hoping to reap similar benefits. Pennsylvania might inspire New York, Michigan, California and other states to move forward, particularly when you consider that after the Keystone State brings poker online, the number of people in the U.S. who can legally play will double.

RAWA 2 Introduced in Senate

That said, there still remains any number of scenarios which could potentially derail efforts to introduce legalized online gambling across the U.S, with one example including the passing of a bill banning iGaming at the federal level. Up until now, those lobbying against the industry have lent their support to Sheldon Adelson and his Restoration of America’s Wire Act (RAWA), a bill which was fortunately defeated last year.

On September 21st, however, another version of the bill, called S.3376, was quietly introduced to the Senate by Senator Tom Cotton (R-Arkansas). Once again, the main focus of the bill is to overturn a 2011 decision made by the Department of Justice to allow state’s to decide their own approach on the issue, with S.3376 described on the Congressional website as:

“a bill to ensure the integrity of laws enacted to prevent the use of financial instruments for funding or operating online casinos are not undermined by legal opinions not carrying the force of law issued by Federal Government lawyers.”

Meanwhile, Sheldon Adelson has also threatened to curtail investment in his Sands Bethlehem casino in Pennsylvania if internet gambling legislation goes ahead, and as the casino’s CEO Mark Juliano stated recently:

“We’re certainly not going to continue to make a commitment to reinvest if they follow through with this.”