Hiccup for Iowa online poker bill; Hawaii next state to propose legislation

Iowa Governor Terry Branstad may not be keen to veto his state’s proposed online poker legislation, but Iowa state senators may have spared him from having to make the decision. While File 458 passed a bipartisan Senate subcommittee on Tuesday, it was later yanked from the Ways & Means Committee schedule before it could come up for a vote. Committee chair Sen. Joe Bolkcom told the Des Moines Register that “people needed more time to work through it.”

online-poker-legislation-iowa-hawaii-nevadaSen. Randy Feenstra was less restrained, calling 458 a “terrible, terrible bill … the worst bill I’ve seen in this Legislature … We’ve had all these social bills to address credit card abuses, violence, children’s neglect and abuse, and here’s the main issue why these things occur.” (Damn, if online poker is that bloody dangerous, why aren’t we sending PokerStars to attack Libya?) Sen. Mark Chelgren struck a middle ground, expressing concern that the business model wouldn’t be profitable unless the state’s pool of gamblers underwent a dramatic expansion (something the Poker Players Alliance is already on record as believing). Regardless, it appears to be a setback for US Digital Gaming, the California-based company that hoped to emerge as a prime candidate to operate Iowa’s new poker network.

Meanwhile, Hawaiian legislators are set to examine their own proposed online poker bill on Wednesday (23rd). The draft legislation (which can be read in its entirety here) would redefine peer-to-peer poker as a skill game that would fall outside the current legal definition of prohibited gambling, but it also contains a few serious headscratchers. For instance, it would allow state residents to play online poker – but only the Texas Hold’Em and Omaha varieties. (Suck it, Stud players!) Furthermore, it would only authorize a maximum of two online operator licenses, and these would be subject to financial burdens that make the notoriously punitive French gaming taxes look downright hospitable. Hawaiian operators would have to pony up $100m per year(!) to the state, plus 20% of total wagers. That’s right – 20% of wagers, not revenues. Oh, and if you have an extra virgin daughter lying around, they’d like to toss her into a volcano to ensure it remains dormant, okay?

We’re going to forgive Hawaii for this serious case of overreach. After all, outside of Utah, it’s the only state in the union that currently permits no form of gambling whatsoever (although it’s considering launching a few gambling boats), so clearly they’re not privy to the nuts and bolts financial realities of keeping a gambling operation afloat. We’ll consider it an exceedingly optimistic opening bid that is sure to be revised downward as their revenue fantasies run up against economic reality.

Finally, Nevada’s proposed AB258 online poker bill has received its first public backing from the owner of a Nevada casino. South Point Hotel and Casino owner Michael Gaughan told the Associated Press that there is “no doubt in my mind that online poker and other games are coming. [AB258] would make us a pioneer in the nationwide movement and the leader for the rest of the country to emulate.” Gaughan says this despite the fact that his company has yet to partner with any online poker outfit, and therefore would not expect to directly benefit from the change. With or without Gaughan’s endorsement, Nevada politicians will take their first stab at discussing AB258 on Thursday (24th).