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Casino companies fume as two more Nevada online gambling bills introduced

TAGs: AB258, intrastate poker

Nevada may be a desert climate, but it’s been raining online gambling bills in the state legislature this week. On Thursday, Assembly Majority Whip William Horne introduced a bill (AB258) that would not only legalize online poker, but would permit Nevada residents to play against out-of-state competition and allow foreign companies to acquire operating licenses, regardless of whether they’d previously taken wagers from Americans. Now two more online gaming bills have been introduced in quick succession in Nevada’s senate.

two-more-nevada-online-gambling-bills-smallSB218 aims (in part) “to provide by regulation for the operation of hosting centers and service providers,” while SB103 would authorize “a licensed interactive gaming service provider to perform certain actions on behalf of an establishment licensed to operate interactive gaming.” Both bills seek to carve out a separate “mid-tier” licensing role for service providers, allowing them to work with Nevada’s existing licensed operators. Nevada Gaming Control Board chairman Mark Lipparelli told the Senate Judiciary Committee that under the current licensing scheme, “there is really no option” for such companies.

When asked by committee chairwoman Valerie Weiner what prompted the introduction of SB103, gaming attorney Robert Faiss said that despite the failure to pass pro-online gambling legislation at the federal level, increasing momentum at the state level (California, New Jersey, Iowa, Florida) necessitated Nevada getting its regulatory ducks in a row in preparation for the inevitable. No vote was taken at Friday’s committee hearing, and Lipparelli noted that the similarities of the two bills would need to be reconciled before being resubmitted to the committee.

Meanwhile, the reaction of Nevada-based casino companies to Thursday’s introduction of AB258 has been decidedly negative. MGM Resorts spokesman Alan Feldman reiterated his company’s preference for pro-gambling legislation at the federal level. “The business model ought to be following sound public policy, and [the Nevada bill] is actually a pretty good model of getting a business model way far ahead of anyone’s policy.” Caesars Entertainment senior VP Jan Jones concurred, telling the Associated Press that AB258 was “not a bill that we support. Our focus is not intrastate, our focus is interstate. It’s federal.”

In response, AB258’s sponsor Horne pointed out that the federal option didn’t seem to have any momentum. “It would have been great if it was done back in DC. That doesn’t preclude Nevada from doing something.” Zac Petkanas, spokesman for Sen. Harry Reid (whose proposed federal online poker legislation died just before Christmas without coming up for a vote), believes “the writing has been on the wall that if the federal government doesn’t act to regulate Internet poker, then states will try to do so.”

While we here at CalvinAyre.com think AB258 is (as currently written) the single most progressive piece of online gambling legislation yet to emerge in the US, we don’t hold out much hope that it will become law any time soon. The push-back by deep-pocketed land-based casino interests, combined with the inevitable intervention by federal lawyers, means that foreign operators will likely remain on the outside looking in for the foreseeable future. However, if it were to pass, it would make an utter mockery of all those public companies who fled the US market in 2006, then paid multi-millions to buy their way back into the US law enforcement’s good graces.

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