The District of Columbia will be the first U.S. jurisdiction to allow Internet gambling, capitalizing on the multibillion dollar industry, according to an Associated Press article.
“Anytime you’re cutting budgets and you want to save some programs, you’re looking for different pieces from different pots and you hope that you get to the number that restores those budget shortfalls and that’s what we’re trying to do with this,” D.C. Council member and author of the provision Michael A. Brown told the AP.
Permitting the online games was included in the 2011 budget. The 30-day period for Congress to object expired last week, Brown told the AP. Greece-based company Intralot would operate the games available only to gamblers within the borders of the district.
The AP reported that officials were not certain when the gaming would be up and running. DC lottery officials told the AP they were in talks with their vendor and more news should be available this week.
Legalizing online games in the jurisdiction falls into the grey areas of a 2006 federal law that effectively banned Internet gambling, reported the AP. The law essentially prohibited banks and credit card companies from processing payments from gambling companies to individuals. “There was really no clear law that said we could not do this,” Brown told the AP Wednesday.
DC will use online gaming profits to offset budget cuts and help social services programs, Brown said. “Conservative estimates from D.C.’s chief financial officer indicate the district could bring in around $13 million to $14 million through fiscal year 2014, according to Brown’s office,” the AP stated.
Revenue estimates are only speculation, and a lawyer whose firm represents online gaming companies, Jeff Ifrah, said online poker players may not migrate from their longtime preferred site to a new one endorsed by a state. “Players are really loyal in this industry,” Ifrah told the AP. “You really have to ask yourself what is the incentive a player is going to have to leave a trusted site with global competition to play in a site that’s untested and kind of unknown and doesn’t offer you the same level of play.”
Lottery officials will determine which games in addition to poker the district can permit.
Efforts to legalize Internet gambling have stalled in New Jersey, Hawaii, California and Nevada this year. David Schwartz, director of the UNLV Center for Gaming Research, told the AP he thought states were waiting for clearer federal guidance before proceeding with Internet gambling proposals. “There’s a lot of ambiguity at the federal level,” he said. “A lot of people are waiting for some sort of federal legislation that would create a regulatory structure.”