Under pressure from Indian tribes and card rooms to modify a proposed online poker bill to exclude companies who currently do not offer live poker, the bill’s authors did so and the measure will be re-introduced to a Senate committee on June 12.
Senators Roderick Wright and Darrell Steinberg have made significant changes to SB1463 that seemingly leaves the horse racing industry finishing out-of-the-money since they have no experience in the realm of poker. Other amendments to the proposal include doing away with a plan to permit online casino games to be offered after the initial two-year period of online poker only, changing the length of the licenses to five years as opposed to ten, putting the duty of issuing licenses on the California Gambling Control Commission (CGCC) instead of the state’s Justice Department, requiring applicants to be in “good standing” with the CGCC for at least three years prior to submitting an application, allowing the $30 million license fee to be good for five years instead of three, and permitting a possible renegotiation of that fee after the first five-year license expires.
The California Tribal Business Alliance and the Pechanga Band of Luiseno Mission Indians objected to many elements of the original bill and were successful in having certain provisions amended that favor existing casinos and card rooms. They also persuaded the bill’s authors into removing a requirement that tribes waive their sovereignty rights in order to hold an Internet poker license. The Indian tribes will now waive sovereignty during the process of applying for a license only.
In addition, license applicants are not restricted to only one online poker site–there is no limit– and may form partnership agreements with gambling companies outside of the Golden State who do not need to adhere to the three years in good standing provision.
As you can imagine, this bill will not please everybody and is certain to be met with objections from various factions. First and foremost is the horse racing industry, who apparently get shut out completely unless they are thrown a bone in the form of additional revenue or expansion to allow them to compete against racinos–horse tracks in nearby states that offer slot machines along with playing the ponies. Some California companies also oppose the fact that non-California gambling businesses can collaborate with existing California entities and take some of the revenue. One such company is Bwin.party, the world’s biggest publicly traded Internet gambling firm and hosts of PartyPoker, who have already forged an agreement with the United Auburn Indian Community in California to operate poker sites in the Golden State.
California is the most populous state with over 37 million residents and the player pool is expected to be at least two million based on pre-Black Friday tabulations. Although everybody is watching Nevada as the first state to enact online poker legislation and due to be up and running by year’s end, California is the state to watch in regards to an interstate format eventually being phased in due to the number of players expected to be logging on from California.