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Tribal Study Blasts California’s Online Poker Hopes
February 8, 2010 / GamblingCompliance Ltd / Peter Hecht
A study by a former state finance director warns that legalisation of internet poker in California could deprive state budget coffers of $365m annually because the games would violate gambling exclusivity agreements with tribal casinos.
The study by Michael Genest Consulting on behalf of the California Tribal Business Alliance ignited new controversy in a feud among tribes over the worthiness of establishing an online California “internet poker consortium."
A coalition of California card clubs and a powerful casino tribe, the Morongo Band of Mission Indians, are pushing hard to establish and run a single intrastate poker site that could give 60 card rooms and more than 200 federally recognised Indian tribes in the state a chance to profit from the online games. The tribe shelved plans to introduce a bill in the 2008-2009 legislative session but are known to be working towards an amended version for introduction later this year.
Genest, who stepped down recently as California top fiscal official, wrote that online poker in California possibly could generate $536m in sales – and a $53.6m revenue stream to California’s general budget fund if the state imposes a 10 percent state fee on the games. So far, no specific taxing regime has been proposed for Californian online poker. Yet Genest asserted that online poker would shatter exclusivity gaming agreements California signed with tribes in casino compacts. He said the tribes can immediately suspend revenue sharing payments to the state – estimated at $365m for the 2010-11 fiscal year – if any other use of gambling devices is permitted.
In this case, the gambling devices would be computers of hundreds of thousands of Californians playing the online games.
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John Maloney
Principal and General Counsel
Law Offices of John K. Maloney
Sacramento, CA
John K. Maloney is founder and principle attorney of the law offices of John K. Maloney. John works in the firm's Las Vegas office and specializes in the area of gaming regulatory law and assists gaming clients in domestic and international markets which represents casino management companies and casino service industries including manufacturers and distributors of gaming related equipment. Maloney has more than 24 years in the gaming field & spent eight years with the State of Nevada Gaming Control Board in the Investigations Division and four years with the Casino Control Division in Queensland, Australia. This work involved licensing investigations of large multinational companies and interactions with law enforcement and regulatory bodies worldwide. Maloney is also a founding member of the International Masters of Gaming Law (IMGL) which is a non-profit association of attorneys, gaming regulators and gaming executives dedicated to the education, advancement of the gaming law profession and exchange of professional information concerning the local and global practice and development of all aspects of gaming law & is also listed in The Best Lawyers in America (Woodward/White, Inc.) in the Gaming Law Section and The Chambers Guide, which lists the top attorneys in 175 countries that determines ranks by independent research carried out during the prior 12 months. John is an author and frequent speaker on many gaming law issues. He can be contacted at ds @ schiffman.us
