California online poker bill vote delayed to consider new ‘bad actor’ amendment

TAGs: ab 2863, California

california-online-poker-bill-grayCalifornia legislators punted on voting on the state’s online poker bill but promised to try again within the next two weeks.

On Wednesday, the California state Assembly Appropriations Committee convened to vote on Assemblyman Adam Gray’s AB 2863 poker bill, but uncertainty over some unpublished proposed amendments left legislators feeling they needed more discussion behind closed doors to make up their minds.

Committee chair Lorena Gonzalez apparently offered up several amendments to AB 2863 on Tuesday, details of which were revealed during testimony of Jeff Grubbe, who spoke on behalf of the Agua Caliente tribe, part of the coalition vehemently opposed to Amaya Gaming’s PokerStars brand having any role to play in California’s poker market.

Among these amendments (viewable here), Gonzalez proposed that ‘bad actors’, aka companies that were deemed to have illegally accepted wagers from California residents between Jan. 1, 2006 and Dec. 31, 2011, be barred from acquiring a license until Jan. 1, 2021. However, this ban could be sidestepped if an offending company pays $20m in back taxes.

Grubbe called this fee a “get out of jail card” for “intentional tax-dodgers” which is “not anywhere near full restitution; it’s not even a time-out.” Grubbe said bad actors will pay this fee “without blinking an eye” and the Agua Caliente tribe will “strongly oppose” any bad actor’s attempt to “buy their way into the California market.”

Grubbe began his testimony by insisting that the coalition of the Agua Caliente, Pechangas and several other tribes were “not obstructionists.” But they aren’t budging on the bad actor issue, and they insist that these entities “and their successor companies” have no business splashing around in California’s poker pool.

Gonzalez proposed that half of the proposed $12.5m initial online poker license fee be credited against future tax obligations. Gray’s original bill allowed for all of this fee to be credited against future taxes while his latest amendments made this $12.5m a flat fee with no future tax credit.

Gonzalez also proposed that the state claim a 10% share of gross gaming revenue before the state hands racing the promised $60m annual subsidy, as that commitment could see the state collect bupkis.

Other than that, the day’s testimony was largely a repeat performance of previous committee meetings, with the pro-PokerStars tribes, card rooms, racing interests and union members in favor, and the Pechanga coalition as well as the Coalition to Stop Internet Gambling opposed.

Gonzalez said AB 2863 could be ready for a vote at the Committee’s next meeting on June 22, but this could also be delayed until June 29. Earlier, Gray had testified that he would be holding yet another tribal stakeholder meeting within the next two weeks.


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