California Online Poker Push Faces Steep Odds

Late Push For California Online Poker A ‘Herculean’ Task, Legislative Sources Say

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A late effort by a group of American Indian tribes, card rooms, Amaya/PokerStars and the horse racing industry to get an online poker bill out of the California Legislature will be a “herculean” task, Capitol Hill sources said last week.

Along with legislative time constraints, the effort will be made far more difficult if potential online poker stakeholders need to buck opposition from a politically powerful coalition of tribes headed by the Pechanga and Agua Caliente bands of Indians, the sources said.

“Anything’s possible”

With Aug. 28 the deadline for fiscal committees to report bills to the floor, political insiders say it is unlikely there is time to get an online poker bill approved by both the assembly and senate before the session is called to a close on Sept. 11.

“Until the gavel goes down on the last night of session … anything’s possible,” Eric Johnson, chief consultant to the Assembly Government Organization (GO) Committee, said Thursday. “Obviously it’s a short window. There’s three weeks left.

“But to accomplish in three weeks what’s taken 7½ years to get to this point is going to be a herculean task.”

Meanwhile, a high-ranking legislative source who requested anonymity said the lack of both tribal consensus and public clamor to get online poker legalized in California makes it extremely difficult to comprehend a bill reaching the governor’s desk this year.

“I don’t see any momentum,” the source said. “There’s no agreement among tribes. There’s no groundswell of support from the people that are out there, playing. There is nobody banging on the door to the state Legislature saying, ‘We want you to regulate online poker.’

“We’ve got water issues. We’ve got fires burning throughout California. This doesn’t register as being critical on the governor’s agenda.”

Handicapping the late-inning push

Getting an I-poker bill approved by the legislature in 2015 has been regarded as a long-shot, particularly with tribes lacking agreement on whether to license tracks and Amaya / PokerStars, which in 2012 paid $731 million in connection with a settlement reached with the Department of Justice.

But optimism was generated earlier this month when five tribes, card rooms, Amaya/PokerStars and racing industry officials announced a late push to get a bill done despite the Pechanga/Agua Caliente coalition, which opposes licensing tracks and PokerStars.

“There is an intention to move forward and not accept the obstructionism” of the Pechanga/Agua Caliente group, tribal attorney George Forman said.

That optimism appears to have been unfounded.

“I don’t see what’s changed. We know there are two big issues,” the Capitol Hill source said of licensing race tracks and PokerStars. “But there are other issues as well that haven’t even been discussed.

“There are regulatory issues, licensing affiliate issues. If horse racing gets a revenue stream in lieu of licensing there are non-gaming tribes that may also want a revenue stream.

“These are all things that need to get worked out,” the source said. “I just don’t see it getting done.”

Getting an online poker bill to the floor

Chairman Bo Mazzetti of the Rincon Band of Luiseño Indians said through a spokesman that he at least hoped to get a bill to the assembly floor when the legislature reconvened.

“For the first time in nearly seven years there is significant momentum on Internet poker legislation,” Mazzetti’s statement said. Mazzetti declined an interview.

“I am hopeful that as soon as the legislature returns from [its] scheduled recess the full assembly will take up the issue.”

The Rincon casino resort is managed by Caesars Entertainment, a lobby partner of Amaya/PokerStars.

AB 431, a “shell” bill lacking significant language sponsored by Assembly GO Chairman Adam Gray, has passed GO and Appropriations Committee review and is on the assembly floor’s inactive file.

A reported effort to get AB 167, sponsored by Assemblyman Reginald Jones-Sawyer, on the Assembly GO’s Wednesday agenda didn’t materialize with Friday’s deadline for submitting bills for a hearing. AB 167 would extend website licenses to tracks and Amaya/PokerStars.

It is not known if Jones-Sawyer will seek a hearing when the GO committee is next scheduled to meet Aug. 28. Jones-Sawyer Chief of Staff Joey Hill did not return phone calls and emails for comment and a staff member said Thursday it was unclear if there will be any action on AB 167.

“That’s what we’d all like to know,” the staffer said.

I-poker legislation sponsored by Assemblyman Mike Gatto was shelved earlier this year.

A Senate version of Gray’s shell bill sponsored by GO Committee Chair Isadore Hall has not been heard by committee. No hearing is scheduled, a committee source said.

The dividing lines that remain

Tribal unity political insiders believe is necessary to move online poker legislation needing 2/3rds approval of the legislature appears hopelessly elusive. There have, however, been continued efforts to get the Sycuan Band of the Kumeyaay Nation to mediate the differences.

The Pechanga/Agua Coalition, which numbers as many as nine tribes and includes the Viejas Band of Kumeyaay Indians and Yocha Dehe Wintun Nation, has been characterized as obstructionists because of its hard line on racing and PokerStars and the fact few of the tribes have publicly announced partnerships with potential vendor partners.

Rincon, United Auburn Indian Community, and Pala Band of Luiseño Indians, operators of Pala Interactive, support licensing race tracks, which wields political clout in part through its affiliate Teamsters and Service Employees International Union.

The San Manuel Serrano Mission Indians and Morongo Band of Mission Indians, partners with PokerStars and three Los Angeles area card rooms, do not oppose extending licenses to the racing industry.

“At the end of the day it’s going to be left to Adam Gray or the bill author to determine how and who will be accommodated in the legislation,” Jacob Coin, San Manuel’s executive director of public affairs, said last week.

“They’ll do the calculations, politically, policy wise and other ways.”

“The tribes on our side of the issue are fairly coordinated in terms of what we hope will be a good, strong run the balance of this session.”

Although online poker remains a long-shot for 2015, many are pleased at the progress made in getting a bill enacted.

“There has been progress made this year,” a legislative source said. “It’s a question of how much time is left to get something done.”

- Dave Palermo is an award-winning metropolitan newspaper reporter. He has written about American Indian governments for more than 20 years, working as an advocate for several tribes and tribal associations. He also has co-authored books on gambling and gambling law.
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