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Reid-Kyl Online Gambling Bill Unlikely to Pass in 2012

Majority Leader Sen. Harry Reid (D) and Minority Whip Sen. Jon Kyl (R) have become pessimistic about the potential ratification of a federal online gambling bill. According to the two senators, the bill faces tough obstacles during the lame duck session of Congress and currently doesn’t “have a path forward right now.” The Reid-Kyl Bill, which would allow online poker licensing in the United States, is currently waiting to be introduced before Congress and will have a short period to gain the support of both the Senate and the House. 

Kyl, who is set to leave the Senate at the end of 2012, believes that more important issues such as the fiscal cliff, defense bill, and tax legislation will take priority over the gambling bill. The importance of these legislative issues for the national budget and economy certainly take precedence. “I am not saying that it’s parochial or special legislation, but it’s not sequestration and the fiscal cliff and defense bill and all that, so it would be hard,” Kyl told National Journal. Further, he believes that the limited time period will work against the bill, considering the number of pressing issues presented in Congress.

In addition to these constraints, Reid and Kyl expect fierce opposition to the legislation in the House of Representatives, led by Eric Cantor and John Boehner. House Majority Leader Cantor is a staunch opponent of online gambling and has the support of another powerful opposition voice in Sands Corporation Boss Sheldon Adelson. According to a report on Roll Call earlier this week, House Speaker John Boehner was amenable to a deal regarding online poker, but demanded that Reid provide concessions on some GOP supported legislation.

Kyl and Reid have stated that they are struggling to find an avenue for pushing the bill through both the Senate and the House. Since the new interpretation of the Wire Act by the Department of Justice, both Senators created a bi-partisan bill that would allow online poker, while toughening restrictions on sports betting. Although several states such as New Jersey and California have attempted to legislate online gambling at the state level, the Reid-Kyl Bill is the first major bi-partisan bill that stands a decent chance to pass through Congress. The Senators successfully attached the bill to the CyberSecurity Act of 2012, but the legislation was voted down earlier this week. Since the online gambling bill is unlikely to pass as a stand alone, the Senators will have to find a path to attach the bill to the inevitable budget and tax legislation.

Given the massive obstacles, the United States online poker community will have to hope for a bad beat in its favor for the chance at a federally legislated online poker market. The bill, which has bi-partisan support and the support of the PPA, has generated optimism over the past few months. However, the current state of Congress is causing online poker enthusiasts to fear the worst. Although there is no official plan, state governments may take it upon themselves to legislate the potentially lucrative online gambling market until legilsation is introduced at a federal level.

As AGA president Fahrenkopf states: “We think it’s very important to have a federal standard on consumer protection. If you don’t have a federal floor standard, you’re going to have one state competing with another, and it will be a race to the bottom.”

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