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District of Columbia poised to repeal online gambling law

TAGs: DC Lottery, District of Columbia, Michael A. Brown

DC-Lottery-igamingdc-repealThe District of Columbia is poised to abandon its plans to become the first jurisdiction in the United States to offer legal online gambling. On Wednesday, DC Council’s Committee on Finance and Revenue voted 3-2 in favor of a bill to repeal the District’s online gambling legislation. The repeal bill will now head to the full Council as early as Tuesday for a vote, where observers expect it to pass (nine of 12 members told the Washington Post they would vote for repeal or were leaning that way). The Committee vote followed a raucous hearing last Thursday, in which councilors accused each other of various high crimes and misdemeanors and threatened each other with lawsuits.

If you believe the Council members who voted to kill iGamingDC, the momentum behind Wednesday’s vote to repeal stemmed from (a) the process by which the online gambling legislation was passed, and (b) how Greek company Intralot won the right to provide iGamingDC’s back end. Council member Michael A. Brown inserted the gambling language into a DC budget bill in December 2010, which Council duly voted to approve without much comment. The DC Lottery vendor contract was amended by DC CFO Natwar Gandhi (after it was awarded to Intralot) to change a provision describing the offering of “non-traditional games” to specifically state online gambling.

Council member Brown (who, along with Marion Barry, voted against the repeal) rejected Council members’ claims that he “snuck” his online gambling legislation past their noses. “You can’t ‘sneak’ an amendment into the budget … To what degree [other Council members) knew or vetted it, I can’t say.” Brown and Barry maintain that the Committee’s vote went “against the will of the people,” and Brown suggested other states would be “laughing at our procedure now, moving backwards when we were out in front on this … this was going to be our thing, run by our government, regulated by us.”

The day before the Committee vote, Brown noted that the series of public meetings the anti-gambling contingent had demanded last fall had demonstrated strong support for iGamingDC. “The community is for it, it’s already the law, it’s had the most exhausting process possible. It does make you wonder what the issue is.” Following Wednesday’s vote, Brown blamed unspecified “casino interests” with a preference for federal online poker legislation as the real killers of DC’s online gambling plans. With the (presumably Nevada) casino bosses’ dirty work done, Brown says online gambling “will be federalized, and [DC] won’t get any of the revenue.” Should the repeal bill be approved, Brown intends to re-introduce his gambling legislation “as soon as possible,” possibly with a payback-is-a-bitch provision to block “casino interests” from sharing in the potential iGaming wealth.

Following the vote, Intralot VP for governmental affairs Byron Boothe said DC Council had “dropped the baton.” DC Lottery exec director Buddy Roogow offered up an early candidate for understatement of the year by summing up Intralot’s reaction to Wednesday’s development: “Obviously, they’re not happy about it.” Intralot has spent an estimated $5m preparing the iGamingDC system, for which they’re now on the hook. DC officials told the Washington Post that because the iGaming portion of the DC Lottery contract hadn’t yet been executed, DC has no legal exposure. Intralot’s Boothe called that a “matter of interpretation,” raising the possibility of Intralot seeking legal remedies to recoup its outlay. Any sum owed to Intralot would come on top of the $13m in iGamingDC revenue that DC will now not collect over the next three years. All in all, a good day’s work for DC Council’s grandstanding anti-gambling scolds.

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