Thanks Russ for that sobering and more realistic view. So what your saying is even though COPA disbanded all of the individual entities that made up COPA will most likely still oppose the bill. I'm hoping that would weaken their position.

On the plus side, conservative Repubs will have no say, on the bad side every tiny tribe has enormous power to squish the bill. Money is less needed now, but CA is always and will always be broke once the government spends all the new money plus 10% or so. All CA players should keep informed and since nothing has changed from the last go around the facts are pretty clear on how it would work.

It's unknown what exactly will happen, but this measure is anything but a slam dunk. Some tribes want it, others don't. Some cardrooms want it, some don't. This bill, if it passes, will not pass on a strict party-line ballot.

Republicans will have input on this measure, because it is certain that some Democrats will oppose it. Thus, Republican votes will be needed (especially if it is an "urgency" measure and needs a 2/3 vote to pass).

-- Russ Fox

In CA this is one issue that isn't divided on political lines -- its more on the territorial lines. Also, Sen. Wright will also be introducing the iGaming bill (which similar to last year's SB 1460) at the same time as the sports betting bill (which similar to last year's SB 1310).


- WOL

With Federal bill dead.... all eyes are on CA and NJ.

- WOL

I think Ca Poker is the next best thing to Fed Bill. Ca can support a very nice poker ecosystem imo, just need to make sure the state run sites do not impose ridiculous rake structures.

^^^ Competition is key here, tribes not card clubs not horse racing but all have to have a share in the pie, then rakes can fall, live players are not the brightest on rake but will at least slowly move to the lowest rake.

Without the feds pushing the states will dither a bit, but in two years another fed opportunity will come up if nothing happens at the state. By 2014 lame duck something should have shaken out on the state level or another fed opportunity will happen. The money is there and the DOJ said go forward and make money.

At least in CA we have the ecosystem, there are fish in current climate, if live players can play at home the games will be great. It is just a matter of getting the B&M companies to agree to let it happen.

The bill got introduced so that is the first step.

What is the rake and will there be competition?

Your getting ahead of yourself a bit here.

No bill introduced in California.. yet. The bill is proceeding in NJ.

- WOL

Details details it will go forward a bit in CA other states don't really matter for CA players. The b&m don't want to compete, not letting other states in without a fight.

As expected, SB 51 introduced this morning.

- WOL

http://www.leginfo.ca.gov/pub/13-14/...ntroduced.html

- WOL

Some cliffs of the bill:

Players must be 21+ and located in CA (don't have to be CA residents).

It will be a misdemeanor to offer unlicensed play, run a public poker parlor or to play on an unlicensed site.

Licensed sites can only offer non-banked poker. Specific poker games must be approved by the CA Department of Justice.

Licenses are good 5 years. There is no limit on the number of sites that can be licensed.

Entities eligible to be licensed are Indian casinos, licensed cardrooms, horse tracks and off-track wagering facilities which have legally been in operation in CA for at least the last three years; or aggregates of any of these.

All licensed entities, subcontractors and site operations must be located in CA.

All licensees must be CA residents.

A license applicant must make an advance deposit of $1M-$5M for costs to process the application (which includes suitability of all subcontractors). Overage refunded, underage paid by applicant.

CA regulators can accept site suitability granted by another state licensing agency provisionally until permanent suitability is issued by CA. This provision lasts until Jan 1, 2017.

Fees and terms of license can be modified by the state after five years.

All employees must apply for employee work permit. Application and investigation fees paid by licensee, amount determined by Dept to cover costs.

To register as a player, site must do age verification: match person against govt database, including matching address on check or credit card. If not feasible, player must submit attestation of age along with copy of govt id.

No deposits by cash or money order.

In cash games, if game can't complete, money is returned to players.
In tournament, if tournament can't complete, prize money is distributed in accordance with published site rules.

Marketing affiliates allowed, as long as player sign up is direct with site.

No interest payments on player account balances.

P2P transfers allowed.

Player funds must be segregated and kept in separate account from operational funds.

Sites must have 24/7/365 telephone support for players, located in CA.

Sites can charge a per hand charge for cash games and a per tournament charge for tournaments. Amount can vary for different games and tournaments. (Seems like no percentage rake allowed, and possibly no "no flop/no drop".)

Before the first hand charge is collected by a new site, the site must pay a $30M license fee against the site revenue taxes for the first five years of operation. (Unused balance not refunded.)

Site taxes are 10% of all gross revenues (per hand charges and tournament charges), payable monthly.

In addition, there will be a yearly regulatory fee to cover costs of the department.

Sites will do yearly state tax reporting on players.

Sites must do 5% state tax withholding on all net tournament winnings of $600 or more (if net winnings are at least 300 times the tournament fee).

After passage, bill is enacted immediately and department has 120 days to adopt regulations.

The state may outsource regulatory duties to other state or international regulatory agencies.

In regards to opting in to a federal bill or inter-state/international player pooling:
There are three 'bad actor' provisions in the bill:

An applicant cannot be found suitable to be licensed if:
In other words, any person or company that operated US-facing poker after Dec. 31, 2006 will not be accepted as a licensee, subcontractor, service provider, etc. in CA.

Lots of additional content in the bill covers the usual: problem gaming, player protections, cheating, fraud, privacy, no bots, random play, site procedures, etc.

Outside of some minor nits, the bill is identicle to last session's SB 1463.

- WOL

Any bill that bans PS is a bad bill.

Not surprisingly it is, but I had hoped they would revisit their bad actor provisions.

The Reid/Kyl Federal bad-actor clause seems like an unconstitutional taking as it effectively presumes that prior providers operated in violation of State and Federal laws and, as a result, denies them the opportunity to obtain a license or even lease/sell their assets to participate in the new regulated market unless they can overcome the statutory presumption of guilt.

CA, the home of worldwinner and other skill based gaming sites, takes it a step further, presuming that anyone that accepted a wager that was not specifically affirmed legal in CA and every US State from which accepted is unsuitable, and denies both the existing owner/operator and any future owner/lessee from market participation.

To understand how absurd that is, consider Skillbet (an online duplicate poker match site), which doesn't accept players from CA because they don't have a CA card-room license and poker is a controlled game there, but they do accept players from 28 US States where 'duplicate poker' has not been 'affirmatively authorized by law' - meaning a company that bent over backwards to stay within the laws of every State in which it accepted players, would not only be unqualified to be licensed under this statute, it couldn't so much as sell it's trademark to a company that is.

This 'bill of attainder' also makes no sense from a public policy perspective, if a company was accepting wagers after Dec 31, 2006 (an arbitrary date as the UIGEA became law in Oct and didn't prohibit anything that wasn't already illegal) because it believed poker to be a game of skill, and that company and it's technology could otherwise prove a suitable asset to the CA online gaming market, the citizens of CA shouldn't be punished by their exclusion.

The purpose of this bill is to raise State revenue and protect consumers by regulating an activity that has already been occurring since ~1997, with CA taking no affirmative action to clarify the legality, not to unconstitutionally protect local stakeholders from fair competition (which harms the consumer).

So if companies accepted wagers from CA previously and disclose that in their background investigations, yet are otherwise deemed suitable for licensing, CA would be better served offering rehabilitation in the form of a fine/retroactive tax bill (see Spain e.g.) through arbitration since the current 'taking' provision in this bill would likely not survive litigation.

tamiller866 notes that the purpose of the new California bill is,

I disagree. The purpose of this bill is to raise revenue; the secondary purpose is to appease organizations that have lobbied for online poker. Player rights and everything else are tertiary items.

I saw on Twitter today that TT believes that only Hollywood Park is supporting this new legislation; thus, he believes it's doomed. I tend to agree with him for a different reason. Revenues for California will likely come close to projected for the current fiscal year, so the need to find additional sources of revenue will be minimal. (Proposition 30 increased taxes, and it passed so late in 2012 that people couldn't modify their behavior in 2012. As Alan Greenspan correctly noted, whatever you tax you get less of. But I digress....)

There is a far greater chance of something passing during 2014 when California will again likely run a budget deficit, it's an election year (including governor, and running for election and proposing another tax increase won't go well), and California will be looking under every rock for any dime of revenue.

Yes, I'm cynical about online poker in the Golden State. Unfortunately, I think I have basis for being cynical.

-- Russ Fox

I was referring to the rational basis for state regulation of a private industry 'purpose', of course we all know what the real 'purpose' is.

Most folks in CA are all cynical about this bill's chances, but there is growing optimism that another bill is going to be introduced, one that the Tribes support.


Reid/Kyl might have 'failed', but it definitely seems to have lit a fire under the various State level stakeholders.

I think this thing has a chance (but will be heavily amended come April).

- WOL

Do legal-minded folks think that the ban on percentage-based rake in this bill is a barrier to interstate pooling?

The bill is limited to "intrastate" -- defining intrastate as "within the borders of California." I think that may forclose the opportunity to pool with other states.

What do others think?

- WOL

19990.71. The Legislature may, by a statute adopted by a majority
vote of both houses, do either of the following:
(a) Opt out of, or opt into, any federal framework for Internet
gambling.
(b) If the United States Department of Justice notifies the
department in writing that it is permissible under federal law, enter
into any agreement with other states or foreign jurisdictions to
provide Internet gambling.

oh right - I remember that provision...

http://pokerfuse.com/news/law-and-re...roduced-21-12/