Report: Efforts to Pass U.S. Federal Online Poker Bill in 2012 Expire

Report: Efforts to Pass U.S. Federal Online Poker Bill in 2012 Expire 0001

Federal efforts to pass Internet poker legislation during the lame-duck session of Congress have expired, perhaps ending the last chance for federal regulation before the states take on online gambling.

David Krone, chief of staff for Senate Majority Leader Harry Reid (D-Nev.), told the Las Vegas Review-Journal that the Senator had “run out of time” on his push to establish licensing and regulation of Internet poker in 2012.

Krone indicated that Reid would try again next year but didn't seem optimistic.

“Our goal is to definitely try again next year but Senator Reid's feeling is that after a while there comes a time when you've lost momentum, you've lost the consensus you've built,” Krone said. “There will be a window next year, but I don't see it going long.”

“It is an extremely disappointing end to a year where tremendous progress was made,” said John Pappas, executive director of the Poker Players Alliance. “I am most upset for the players, who have been calling on Congress for years to pass an Internet poker law that protects consumers, restores their freedoms and raises revenue. While I don't think these voices have fallen on deaf ears, I am discouraged that Congress could not coalesce around a solution in the wake of the ongoing fiscal crisis.”

This effort seemed like the last and best chance to create a federal structure for online gambling before the states strike out and make their own systems and regulations. Nevada already is licensing companies for its online poker, which is expected to be up and running in the first half of the new year. Delaware passed legislation this year to offer full online gambling through its state lottery. New Jersey is looking to pass legislation next week that would allow Atlantic City casinos to offer full online gambling. Nevada and New Jersey have aspirations to get other states to approve online poker and allow their citizens to play through Nevada and New Jersey in exchange for tax revenue.

“I hope all the stakeholders can put finger pointing aside, learn from this year's failure, and begin the fight anew for 2013,” Pappas said. “We are pleased Sen. Reid intends to push again in early 2013 and we will fight with him, but we are mindful that many states will move forward next year and the PPA must be at the forefront of those efforts, as well.”

Reid had pushed for federal Internet poker legislation in the past, most notably in 2010, at the behest of his Nevada casino constituents. This year the efforts got serious as Reid negotiated a compromise with Sen. Jon Kyl (R-Ariz.), one of the biggest opponents of online gambling in Congress. The Reid-Kyl bill, officially titled The Internet Gambling Prohibition, Poker Consumer Protection, and Strengthening UIGEA Act of 2012, would allow for Internet poker while prohibiting other forms of online gambling.

Kyl was reacting to a Justice Department opinion last December that the Wire Act applied only to sports betting. This opened the door for states to pursue full online gambling, as Delaware and New Jersey are doing. Kyl came around on the idea of separating Internet poker as a skill game if he could stop casino gaming from going online. This worked for Las Vegas casinos, which nearly universally want online poker but are afraid casino games would take away from their brick-and-mortar businesses.

With Reid providing Democratic support and Kyl rounding up Republicans, it appeared the bill had a real chance heading into the lame-duck session of Congress. But it wouldn't be able to pass on its own. It would need to be attached to must-pass legislation as a rider.

After much bickering between the sides over Republican support, Kyl indicated this week that he had enough Republican votes to ensure that any bill with Internet poker attached would not be filibustered in the Senate.

The problem apparently ended up being that Reid had no suitable vehicle on which to attach the bill. The lame-duck session has focused on a bill to avoid the so-called fiscal cliff. Reid hasn't directly been involved with negotiations on that bill, which is being handled between President Barack Obama and House Speaker John Boehner (R-Ohio). All indications are that Boehner wouldn't consider attaching Internet poker to the bill.

The lame-duck session, which usually ends before Christmas, apparently left no time for Reid to find another vehicle in 2012. Any effort to move the legislation early in 2013 could prove difficult because Kyl, who declined to run for re-election, will no longer be in office to rally Republican support.

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