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October 17, 2021

Prospects for passage unclear

California online poker amendments could lead to PokerStars ban

California online poker amendments could lead to PokerStars ban
Amendments to an online poker bill that would put Amaya/PokerStars on the shelf for at least five years was released late Wednesday by California Assemblyman Adam Gray in an 11th-hour effort to get AB 2863 through the state Legislature before an Aug. 31 a
United States | 08/18/2016

Amendments to an online poker bill that would put Amaya/PokerStars on the shelf for at least five years was released late Wednesday by California Assemblyman Adam Gray in an 11th-hour effort to get AB 2863 through the state Legislature before an Aug. 31 adjournment.

D

ivergence on “bad actor” issue at heart of debate

The amendments are believed to be supported by at least 10 politically-powerful American Indian tribes Sacramento insiders believe are necessary to get California online poker legislation through the Assembly and Senate.

But the mandated five-year “penalty box” in AB 2863 for companies who accepted or facilitated wagers from American customers after December 31, 2006 is opposed by PokerStars and its business partners, the Morongo and San Manuel Mission Indians and the Commerce Club, Bicycle Club and Hawaiian Gardens card rooms.

The bill is also being amended to change the tax rate for poker websites from a sliding scale of 8.64 to 15 percent based on annual gross gaming revenue to a flat rate of 10 percent

Short wait to find out if bill can advance

Tribal sources last night said getting the necessary 2/3rds vote of the Assembly over the objections of the tribal/PokerStars/card room coalition would be “a steep climb.”

But sources said support from ten other tribes – a coalition of seven tribes led by the Pechanga Band of Luiseño Indians and Agua Caliente Band of Cahuilla Indians and three other tribes active in lobbying the issue – could get AB 2863 out of the Assembly by the end of the week.

“This potential compromise presents the most viable path to legalization,” said a tribal source who requested anonymity

The amended bill “should secure two-thirds [vote] in the Assembly,” Trent Hager, chief of staff for Gray, told the Los Angeles Times.

Hager predicted the bill “will be fairly well received in the Senate.”

Degrees of compromise

The Pechanga/Agua coalition had taken a hard line against licensing PokerStars, which reached a $731mm settlement with the federal government following accusations it violated state and federal laws. PokerStars admitted no wrongdoing in conjunction with the settlement.

But member tribes recently began easing their position against the foreign company, demanding only that it be “shelved” for at least five years, a similar penalty imposed on the company by Nevada gambling regulators.

Tribal officials Wednesday urged Morongo and San Manuel to align themselves with other tribes and stakeholders in getting online poker legislation through the Assembly and Senate.

“If San Manuel and Morongo are genuinely concerned with protecting consumers, they would support this tenuous compromise,” said a tribal official who requested anonymity.

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