Discussion Revs Up Over Online Gambling Bill

11 December 2012

Efforts heat up on all sides of the proposed Redi-Kyl online gambling bill this week as lobbyists from the North American Association of State and Provincial Lotteries and the National Association of Convenience Stores descend upon the capital.

Says Bryan Preston of the PJ Tatler in his article, Harry Reid Launches Online Gambling Power Grab, “Sen. Reid will work harder to hand a sop to the gaming industry in Nevada than he will work to pass federal budget.” He goes on to say that the online-poker-only bill supports only large corporations who have the ability to swoop in and manage a large portion of the gambling; these large corporations, of course, have their foundations in the state of Nevada.

“The American Gaming Association is behind the bill, which would have the federal government impose its regulations on online gaming in ways that would end up benefiting…the members of the American Gaming Association,” says Preston. The American Gambling Association includes members like Caesars and MGM.

While it’s true that the online-poker-only federal bill may benefit Nevada nearly exclusively when it comes to jobs and revenue, a more consistent approach to online gaming regulation may strengthen the overall industry. As the expression goes, people have the power to “vote with their feet”; if people prefer to live in a state with online poker or find work in the online poker industry, they have the ability to benefit from this bill, should it in fact pass, as much as they personally see fit.

And the Reid-Kyl online poker bill is firing up an feud may folks didn’t see coming: state-run lotteries vs the convenience stores that sell their tickets. An approved online-poker-only bill would mean that states could not (or no longer, in the case of the states ahead in this technology) offer online lottery ticket sales. The state lotteries, of course, are against such measures, as it could cut into the game profits and the public funding it provides. The National Association of Convenience Stores (NACS), however, is offering loud support of the bill, anxious to drive people away from online lottery sales and have them drive to their stores instead, where they may purchase additional items along with their tickets.

According to the proposed bill, which is still in a draft version, state lotteries that have a once-a-day drawing would still be able to sell lottery tickets online. All online instant win games, however, would illegal. As many states offer instant win lotteries currently, the prospect of having this well dry up is a tough swallow.

On the other hand, as convenience store owners believe, offering a scratch off product online takes a way from the sales, jobs, and the community a convenience store helps support. The NACS has proclaimed their support for a restrictive online gambling bill that limits the amount of online gambling allowed in the US.

In a recent editorial in the The Las Vegas Review Journal, the writer states that with the proposed bill “lotteries and casinos are in direct competition for the same, limited dollars Americans are willing to gamble, whether it’s a few bucks on scratch tickets or $100 at the tables.” State lotteries are taking the approach that each state should be allowed to determine what and how games are offered within their borders.

There are many sides to this issue, and none to be taken lightly. If Congress doesn’t approve a federal bill during the final weeks of the 2012 Lame Duck session, we’ll likely see each state take their own course of action.

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