Mr. LetsGambool:

You are an incredibly astute pooh-bah. I put the number of opt-out states at ten to fifteen. (Based on my #122 reply, Alabama is a lead pipe cinch to be one of the opt out states.) Since 12.5 is in the middle of that range, I'll round it up to 13. I'm not going to bet any money on it, but I agree with you that five is an insanely low number.

Former DJ

NoahSD:

Not that my crystal ball is any clearer (or less clouded) than anybody else's, but this is my list of predicted bad guys:

Alabama
Oklahoma
South Carolina
Texas
Utah
Vermont
Washington
Hawaii
Kentucky
Georgia
Tennessee
Minnesota
California

I agree with Russ Fox on California. I think California is more likely to opt out and go with their own intra-state internet poker - or opt out completely due to opposition from Indian tribes.

The southern states I've listed (including my own state of Alabama) are full of churches and citizens with moral objections to gambling. Mississippi is a fluke since they resorted to casinos only because the Federal Government was threatening to withhold transfer payments if Mississippi didn't do something about their swelling welfare payments - especially to very poor places like Tunica county. (Before casinos arrived, Tunica County was the poorest county in the United States as measured by per capita income.) This was becoming a major drain on the federal treasury, so the Feds basically ordered Mississippi to "do something" about their problem. Rather than voting to raise taxes on their citizens, Mississippi legislators voted for casinos instead as a means of getting the Federal government off their backs. That set of circumstances doesn't translate to most of Mississippi's neighboring Southern states, so that's why I'm listing several of them as [likely] opt outs.

One other totally unrelated thing before I close. The work you did in exposing Nick Grudzien and his cheating was awesome. This brings me to another flaw that I see in these PPA-sponsored bills to legalize online poker. I read through all 93 pages of Senator Menendez's bill (S.1597) and didn't see a thing along the lines of strict penalties and sanctions - up to and including fines and possible imprisonment - for players (like Grudzien) who are caught cheating. The Government has an interest here since players will avoid "legal" government-sanctioned internet poker if they see players like Nick (and Russ Hamilton) getting away with slow playing and other forms of cheating. I also think the legislation should include an anonymous "hotline" (independent of the sites) where players can report suspicious activity and other anomalies. If such a hotline receives a statistically significant flood of calls and emails concerning a certain player or a certain account, that would alert the Government to possible bad behavior. With such a hotline in place, folks like Nick and his buddy might have been caught much sooner. Also, a bill that includes fines and possible imprisonment for the most egregious cheaters would have a beneficial "deterrent effect" on some [but not all] players who choose to try and cheat their opponents. I was so bothered by the fact that strong anti-cheating and anti-collusion measures [apparently] aren't included in Senator Menendez's bill that I sat down and wrote him a letter raising these concerns. It's been a little over a month since I sent my letter, but so far I haven't heard from him.

Former DJ

Reply from Randy Brogdon (R)

kind of a wash imo




I do not support state-sponsored gambling. Although, I do feel that what
ever you do in your home is your business and should not be controlled by
gov't.

Dedicated to Liberty,

RB





my reply:


Thank you for your reply, it is appreciated.

I share the same belief as you. Whatever people do in their own homes is no ones business but theirs, and the government shouldn't be trying to "protect" people from themselves, or legislate its version of morality.

Regarding HR2267, the internet gambling regulation, consumer protection and enforcement act, if passed, there will be a process where federal regulations are developed by the department of the treasury to implement the provisions of the law. Once regulations are completed, internet poker sites will be required to apply to the secretary of the treasury for a U.S. federal license to legally offer internet poker to players in the U.S. The licensed sites will be liable to U.S. jurisdiction and must follow all of the regulations.

The regulations will include protections against consumer fraud, underage participation and problem gambling. The licensed sites will be required to make regular reports on their activities to the government regulators, and appropriate individual taxpayer reports for the IRS. Fees for licensing and fees on player deposits will be paid by the sites and shared between the federal government and state governments who choose to not opt out.

Personally, I am still iffy about supporting this bill. It could potentially do more harm than good to online poker, and that hurts my bottom line as a professional poker player. The rake (poker site's cut) may increase, player pools may shrink if many states choose to opt out. I am waiting until after mark up to decide if I support the bill or not.

This brings me to why this federal legislation is being proposed. In 2006, the Unlawful internet gambling enforcement act (UIGEA) was attached to a completely unrelated bill, the safe port act, and passed at midnight the day congress adjourned for the 2006 elections. The UIGEA prohibits the transfer of funds from a financial institution to unlawful internet gambling sites (but failed to define "unlawful internet gambling"), and specifically excluded fantasy sports betting, online lotteries, and horse racing.

As a result of the UIGEA, many online poker sites withdrew from the U.S. market, the largest being party poker, whose publicly traded stock dropped almost 60% in 24 hours. Credit cards could no longer be used to deposit or withdraw. Because the UIGEA limited deposit options, many casual players quit playing, and this has had a tremendous negative impact on the game. Marginal winners became losers. Large winners became marginal winners. The overall health of the online poker economy was weakened, the games got harder and harder, and the opportunity to make a living playing online poker was diminished, and only the best players were able to continue.

All of this happened because some in Washington felt they needed to "protect" Americans from themselves, and felt as though we Americans were not to be trusted to make our own responsible decisions with our money that we worked hard for. Many Americans like to play poker. They enjoy it. Why should the government try to keep them from an activity that they enjoy like that? It's absurd. People should be able to make their own choices, do as they wish with their money, and not have the government trying to restrict what activities they pursue for entertainment, or as a field of work.


As said, I'm unsure if I support HR2267, but what I do know is this. I support the repeal of the UIGEA. It's a poorly written law which doesn't even define "unlawful internet gambling", it placed unnecessary burden on banks, and it was a slap in the face of American's liberties.

I appreciate your reply, and I ask that you continue to uphold your belief, and oppose legislation that impedes upon it. Americans should be able to do as they wish from the comfort of their own homes, with their own money, without having the government try to control what they can and cannot do.

Thank you for again your reply.

Still disagree LG.

You suggest that these folks, the Unions and the governor, will rise up against us. I suggest they will do no such thing. And since the bill is opt out rather than opt in, doing nothing means we win.

The governor is not going to buck a US sponsored online system (that will create US jobs because US sites will be created) and turn down its revenue stream just because he doesn't like gambling. He would look foolish.

He probably would do it if the casino interests and the casino workers union demanded it. But would they? They did not demand it in the casino bill. We have talked with MA union reps, and they are aware that a) many of their members like to play online poker and 2) online poker does not impact casino operations negatively, but rather it can help through linking and branding. The casinos know this too.

And that the "lottery would lose revenue" is also old news. Wont the lottery lose revenue to the new casinos? That's been decided not to be the case to any significant degree. The same is true for online gaming. Its separate realms and they know it (which is also why many state lotteries - like NH again - are trying to get into the online gaming market).

No, the coalition you imagine forming to get an "opt out" is very unlikely to materialize IMO. It didn't before, and I see no reason it will in the future.

That leaves merely the leftist nanny-staters who "know" that all gambling is bad for the poor folks who can't be trusted to spend their money as they see fit but need government to tell them what to do and not do.

As passage of the casino bill again proves, those folks are no longer anything near a majority in MA.

MA opts in.

Skallagrim

Governor Paterson (NY) would definitely opt-in IMO. The guy is raising taxes, cutting funds, and adding revenue everywhere possible with complete disregard of public opinion. Unfortunately he has zero chance to be reelected.

I think Andrew Cuomo will win the next election for governor in November. I don't his stance on internet poker though.

Does anyone know how much if any sites like FT or PS have given to promote the cause?I'm guessing it's a phat 0.anyone know?

Your guess is completely wrong. I don't know the figures, but a large portion of the PPA's funding comes from donations from the IGC, which is largely funded by FT and PS. In addition, FT and PS have their own paid DC lobbyists, who lobby for the legislation and make appropriate campaign contributions. They have also had freerolls with real money payouts for players that signed up as new members of the PPA, and sent e-mails promoting the PPA a few times (which costs them money, too).

My guess is they have both spent millions on getting this legislation passed.

Kentucky Opt-out. Kentucky attempted to seize gambling websites and tried to prevent Kentucky residents from accessing gambling websites if you recall.

Louisiana Opt-out. Too conservative. I predict they will opt back in, after a few years due to the terrible budget situation there

North Dakota Opt-in. This one is easy. North Dakota's House of rep passed a law to legalize and regulate online poker, and ND's senate only voted it down after the DOJ started claiming online poker was illegal and tried to scare them.

Current predictions:

Predicted Good Guys (17)

Colorado
Connecticut
Delaware
Florida
Iowa
Massachussets
Michigan
Mississippi
Missouri
Montana
New Hampshire
New York (One time!!)
Nevada
North Dakota
Oregon
Wyoming
Virginia

Predicted Bad Guys (11)

Alabama
Georgia
Hawaii
Louisiana
South Carolina
Tennessee
Texas (Would like to hear more on this one since Texas is a huge state with tons of online poker players living in it)
Utah
Vermont

Toss Up/Some Debate (8)

California
Idaho
Kentucky
Minnesota
North Carolina
Oklahoma
Washington
Wisconsin

Not Yet Discussed (16)

Alaska
Arizona
Arkansas
Illinois
Indiana
Kansas
Maine
Maryland
Nebraska
New Jersey
New Mexico
Ohio
Pennsylvania
Rhode Island
South Dakota
West Virginia

That may be oversimplified. The Kentucky governor initiated these actions on his own. The legislature did not seek this action and the state attorney general did not join in.

Also, the two Congressionally authorized online gaming sites in the U.S. -- TwinSpires and YouBet -- are both owned by Kentucky's Churchill Downs.

Gov. Beshear's problem is with sites that are not specifically authorized by Kentucky. We don't know if he has a problem with licensed online poker or not.

you still need to move Virginia, Noah. It's a likely bad guy.

I think its to hard to predict. Most states can go either way there are only a few shoe-ins. We will just have to wait and see

West Virginia

I have only been a resident in WV since Oct of 2007. When I arrived they currently had horse and dog tracks. The West Virgina State lottery and legalized slots and video poker at raceways and bars. Since my arrival they have opened 4-5 casinos and legalized interstate lotteries with Ohio, MI, and some others.

I have emailed my state and local reps and the overwhelming sense I get from them is that as long as it contains safeguards and it benefits the state it would be appealing.

Conclusion
West Virginia Opts In

AZ will opt out - John Kyl + Jan Brewer

MA should be a tossup. A state that has twice tried to criminalize online poker in the last two years has to be suspect.

I do have a little time to address this.

First, a large takeaway from this thread, to me, is that we need to figure out better what the heck the opt-out process actually is. It definitely seems like the structure is going to change the answer in a lot of states.

For example...

Yes, if you have to pass this like a law this becomes a much harder task. If the Governor and legislature can quietly opt out, this can be done much easier. Well, the Governor is against slots which would likely create more revenue and more MA jobs than online poker. Yet he embraces casinos. So while your logic may be fine, Governor's Patrick's actions suggest otherwise.

We'll see. This is a much different issue than a criminalization law that doesn't change the status quo and is completely impractical. Unions get mighty sensitive once the pot of gold is getting split differently.

You got a taste of that in your experience with the AG's office while trying to write the payment processor ballot question. Great idea, could have gained support in MA, for some reason we end up with some absurd ruling against it. That tells me someone behind the scenes wanted it dead for political reasons.

Depending on the opt-out structure, this can easily be killed in the backroom. In a state where the AG and Governor have both taken overt actions against online poker in the past. Isnt this cause for concern?
Not really. Opponents were pretty vocal in bringing it up as an issue. What's potentially getting the casinos done in MA at this point is a combination of union jobs and the potential to help the tracks, one of which happens to be in the district of the most powerful politician in the state.

The tracks slapped our hand away in 2008 when the first criminalization crisis hit. Not sure if relations are better now, but I havent seen hard evidence they support us. This would help.

This is hugely opt-out structure dependent. If the Governor can just opt-out, then you dont need a huge coalition because you arent passing a law.

Its probably not a majority, but its hard to say what legislators stand for. They voted like 100-50 against casinos in the House two years ago and 100-50 for it this year. The difference wasnt a change in stance or anything, just a change in who ran the House.

I dont think the leftist nanny-staters are a majority either, but there is a sizeable faction against it. Check out bluemassgroup.com and read their thoughts on gambling.

Its also worth pointing out that MA HAS NOT legalized casinos yet.

This hasnt happened because DeLeo wont approve it without no bid slots at the tracks while the Senate president wants all the licenses open for bids and the Governor doesnt like slots at all. Internet poker can easily get crushed under the weight of the same conflicts.

I still say MA opts out, but it can in no way be a predicted "good guy" Too many complications around gambling politically and a Governor with an active track record of working against online gaming.

I agree the structure of how states opt-out will be a major factor in the # of opt-out states. I just don't know if Congress can mandate how states decide going about the opt-out process.

Many feel having the state legislator pass a bill or resolution opt-out makes it harder for states to opt-out, which may not be the case depending on the language of the state opt-out bill. I don't think Congress (though I could be wrong) is going to write or tell states how to word their opt-out legislation. Congress simply wants to know if states want to opt-out and give them so much time to do so. States may draft their legislation so they opt-out unless a bill passes to opt-in.

States didn't ask for this Federal legislation and many may not want it or want to give the power of regulating gambling over to the Federal gov.

LG, who in the MA gov. is likely to draft opt-out legislation (if the Governor can't simply opt-out on his own)? What if DeLeo is the one who crafts the opt-out language? If he is against the Frank bill for MA then wouldn't he try and craft the wording of the legislation to make it difficult for MA to"opt-in". All DeLeo, or others against this bill need to do is craft the bill so the MA legislature has to pass a bill to accept the federal online poker legislation if the bill fails they opt-out.

I'm not saying that is how this would happen in MA or any other state but if those in power at the state level don't want this bill, this is one way they could draft any opt-out language. So I'm not sure if simply having language in the Frank bill that makes state legislators the one that have to opt-out solves the "opt-out problem. I'm not even sure Congress could force the states to take legislative action before opting-out, it may largely be state issue governed by state law and procedures.

Edit: sorry for sounding to pessimistic, this was sort of a "what if" scenario, I just wanted to throw this thought out there and give my opinion on why the legislative opt-out solution may not work out in our favor in all cases like some people think.

[QUOTE=LetsGambool;20460453]I do have a little time to address this.

First, a large takeaway from this thread, to me, is that we need to figure out better what the heck the opt-out process actually is. It definitely seems like the structure is going to change the answer in a lot of states.

....

This is hugely opt-out structure dependent. If the Governor can just opt-out, then you dont need a huge coalition because you arent passing a law.

LG:

Concerning your question as to the exact process (or mechanism) by which states will opt-out, it took a bit of digging but I found the following text in S.1597, Senator Robert Menendez's "Internet Poker and Game of Skill Regulation, Consumer Protection, and Enforcement Act of 2009". (The following text is from page 44 of the draft bill beginning at line 8.)

5385. Limitation on licenses in States and Indian lands
"(a) STATE OPT-OUT EXERCISE. ---
"(1) LIMITATIONS IMPOSED BY STATES. ---
"(A) IN GENERAL. --- No licensee may knowingly accept a bet or wager,
under a license issued pursuant to this subchapter, iniated by a person who
is located in any State which provides notice that it will limit such bets or
wagers, if the Governor or other chief executive officer of such State
informs the Secretary [of the Treasury] of such limitation before the end
of the 90-day period beginning on the date of the enactment of the
Internet Poker and Game of Skill Regulation, Consumer Protection, and
Enforcement Act of 2009, or in accordance with paragraph (2), until
such time as notice of any repeal of such limitation becomes effective
under paragraph (2).

So, it appears that under Senator Menendez's bill, (which would have to be reconciled with whatever comes out of the House), the power to opt-out is at the sole discretion of the Governor.

Former DJ

DJ:

You have made a couple of wrong assumptions. First, the bill which comes out of the house does not necessarily have to be reconciled with the Menendez bill. The Senate could just ignore the Menendez bill and take up solely whatever comes out of the House as the bill to be considered.

Secondly, while the provision says that the mechanism to opt out will be by notice from the state governor, that doesn't necessarily imbue governors with the authority to make such a decision without the involvement of their state legislatures. Barring some change to the bill's wording that clarifies who will have such authority under federal law, such authority will be determined by the laws and constitution of each individual state no doubt.

For instance, here in Florida this issue was addressed by the state Supreme Court when it threw out the first gaming compact signed by our Governor Crist and the Seminole Tribe. The court determined that the compact was invalid because the governor did not have the authority to change Florida law, which the compact did because it expanding gaming in the state beyond what was currently authorized by Florida law. A new compact had to be negotiated and passed by the Florida legislature.

The same principle would apply to any action by the Florida governor to execute a state opt out, or possibly even to not execute a state opt out. Not executing a state opt out could be viewed as a choice by the governor to expand gaming in Florida, since it would be a de facto choice to allow licensing of Internet gambling for Florida residents.

The issue is rather complex and involves state laws and constitutions, gubanatorial executive powers, etc. The opt out provision definitely needs clarification or it will just lead to years of legislative bickering and court proceedings in many of the states, and may force many governors to opt out until the question is settled within their state legislature.

DJ:

You have made a couple of wrong assumptions. First, the bill which comes out of the house does not necessarily have to be reconciled with the Menendez bill. The Senate could just ignore the Menendez bill and take up solely whatever comes out of the House as the bill to be considered.

[per Mr. PX, Florida State PPA Director]

PX:

You're not the first (supposedly) "in the know" poker industry pundit or industry rep to tell me, "Hey, just ignore Senator Menendez's bill - his bill is not going to be the bill that ultimately becomes law. It will be Barney Frank's bill." (That is a nearly verbatim quote.)

I'm sure Senator Menendez will be interested to know that he (and his bill) count for nothing with respect to this issue.

Former DJ

Don't twist my words to say something that I didn't say. I merely pointed out that your assumption that Menendez's bill will be taken up is not necessarily true. I did not say that his bill counts for nothing and absolutely won't be taken up. See the difference?

Getting a little sensitive there formerDJ.

PX (who is not an "industry pundit" but simply a well informed and intelligent poker player) said the Menendez bill MIGHT not be the one acted on by the Senate. This is abundantly correct. It also could be the one. Let me consult the Runes and I will try and predict the future for you if you like.

Also, if your "industry sources" are telling you "it will be Frank's bill or nothing" you need to find better "industry sources."

More important is the point you ignored. Whatever the Federal bill says, state law will still be what ultimately determines the precise opt out procedure. That could indeed get quite complex indeed. It should at least provide some work for some lawyers.

Skallagrim

IMO, the US Congress could specify the state opt out procedure since online gaming is interstate commerce. I hope that the bill requires a new state statute.

I agree that the present bill does not necessarily give the Governor the power to decide whether or not to opt out. Under the present language, state law would decide what government entity has this power. The governor's letter is just a notice requirement; not a grant of authority. Yeah, the present language will lead to lots of litigation.

skall, before you consult the Runes please PM me I have several questions I would like them to answer.

Michigan and Ohio??