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Archives for 2018-09-08
The Pennsylvania House of Representatives was expected to vote on a gaming reform package (HB 649) this week that would, among other things, legalize online gambling in the Keystone State. The gaming reforms contained in the legislation would then act as one of the funding components of the 2016 Pennsylvania state budget, which the legislature and Governor Tom Wolf are frantically working on finalizing before Christmas. With the reforms in HB 649, most notably online gambling expansion, the state would garner some $300 million in annual revenue, which is why HB 649 is seen by some as a necessary part of the state’s budget, and a key funding mechanism that could bring the governor and legislature together. Unfortunately, the vote never happened, as a late amendment that added video gaming terminals (VGT’s) to the package was added on Wednesday, and appears to have slowed down the bill in the House. The House adjourned on Thursday without voting on HB 649, and will not return until Saturday, when they will hopefully pass HB 649 and send it on to the Senate — where the VGT amendment will either be removed or act as a poison pill that kills the bill. The VGT problem The reason the VGT amendment (or some other unknown change) could act as a poison pill is, all of this is taking place at lightning speed. Both the Senate and House have proposed budgets in place (the state budget is nearly six months past due; a historic delay), and in addition to reaching an agreement on the budget, the legislature is also busy passing bills that fund the budget. But with time running out, the slightest hiccup, such as the VGT amendment, could upset the entire process. The amendment passed by a whisker on Wednesday, (96-93) in the House, and by all accounts has even less support in the Senate where it will likely be eliminated. The amendment would allow VGT’s in specified private establishments, something the casinos in the state do not support. One possible scenario for HB 649 is for the Senate to remove the VGT amendment from the bill and send their version of HB 649 back to the House for another vote. Considering the small margin by which the amendment was initially passed, the House could simply accept the Senate version in what would likely be another close vote that could go either way. Another option would be a joint committee to quickly craft a compromise and whip up votes in the House and Senate, but there might not be enough time for this to happen. The real concern in the iGaming community is that the Senate might make other adjustments to the bill, such as increasing the tax rate on online gaming operators. This would be very troubling, as there simply isn’t enough time remaining before Christmas break for the two legislative bodies to hash out an agreement on multiple issues, and iGaming would likely be taken off the table and replaced by some other funding vehicle. History of HB 649 HB 649, sponsored by House Gaming Oversight Chair John Payne, and cosponsored by House Gaming Oversight Democrat co-chair Nick Kotick, began as an online gambling expansion bill back in February. The bill had broad support in the House and from the state’s potential iGaming stakeholders, but as the year wore on it was the Senate’s bill (SB 900) that garnered more attention. SB 900 was a comprehensive gaming reform package, and even though the online gambling component was less appealing to stakeholders due to an exorbitant tax rate, the potential revenue from iGaming and the other reforms pushed HB 649 to the sidelines. However, SB 900 never gained traction, and with budget talks at an impasse, HB 649 was resurrected in November — complete with an omnibus amendment package attached with other gaming reforms. The bill easily passed the House Gaming Oversight Committee, was mentioned as one of the funding mechanisms in the House budget, and is waiting for a full floor vote — which will hopefully take place on Saturday. Why HB 649 needs to pass The question a lot of people have is; why does the legislature need to pass HB 649 if it’s going to be included in the state budget anyway? The answer is procedural. Every state (and the federal government) has their own way of doing things, and Pennsylvania is no different. When the Pennsylvania legislature crafts a budget they must explain how much money they need for each department and program and explain precisely where that money is coming from. However, the Pennsylvania budget only appropriates the money to pay for these programs; the funding mechanism, in this case HB 649, must still be passed by the legislature on its own accord. Essentially, the budget outlines where they plan on getting the money from, but the funding source (assuming it’s a new source) must still be passed by the legislature and signed into law by the governor.
Last week Howard Stutz of the Las Vegas Review-Journal penned a must-read column that detailed some of the costly unintended consequences Sheldon Adelson’s push for a federal online gambling ban might bring about. Most notably, RAWA (the Restoration of America’s Wire Act) could lead to a ban on mobile sports betting in Nevada – a ban that could cost the state’s casinos up to $1 billion in annual revenue. Mobile sports betting is a booming business Mobile sports betting is estimated to account for some 30% of Nevada’s $3.9 billion sports betting industry, according to Stutz’s research. Gaming attorney Greg Gemignani of the Las Vegas office of the law firm Dickinson Wright agrees that RAWA has the potential to curtail this business. He told Stutz that it could “backfire on some of our operators in Nevada.” According to Gemignani, even though mobile sports bets placed with legal Nevada sports books would originate and end within the state’s borders, these calls are often routed through surrounding states such as California, Utah, and Arizona. Gemignani fears the interstate nature of these bets would cause them to fall under the scope of the RAWA’s version of the Wire Act, even though the bill likely never intended to ban such an activity. As if this wasn’t bad enough, Gemagnani also envisions a scenario in which RAWA criminalizes the use of VPN’s (Virtual Private Networks), a tool some casinos use to operate their land-based slot machine server systems. As Gemagnani told Stutz, “By making licensed and regulated online gaming illegal, the bill is counterproductive.” Gemagnani makes an excellent point. Criminalizing legalized and regulated online gambling options will not put an end to online gambling, it will simply hurt regulated operators and create a void that will be filled by illegal, unregulated, operators. Couldn’t they just carve out mobile sports betting in Nevada? So why not change RAWA to exempt mobile intrastate sports betting? This is certainly a possibility, and seems like an easy enough fix. But RAWA already has several carveouts, and will likely need several more for it to have any reasonable chance to pass through Congress. Already exempted from Sheldon Adelson’s online gambling ban are fantasy sports and horse racing as well as some forms of online charitable gambling. The exemptions are unlikely to end there In addition to the current carveouts, the general consensus is the bill would have to make an exception for online lottery sales (something Lindsey Graham has already hinted at), as several states have already made lottery tickets available online (Minnesota, Georgia, Michigan, and Illinois). Several more -Kentucky, West Virginia, and Florida – are at various stages in the process. Additionally, many analysts feel RAWA has little chance to pass unless it exempts the current online gambling industries in Nevada, Delaware and New Jersey, as these three states have already passed online gambling legislation and have regulated iGaming industries up and running. If these states receive exemptions, it is likely that a number of other states currently exploring online gambling will voice opposition to RAWA unless they are also granted exemptions. As I’ve explained in the past, at some point this growing number of exemptions will make the bill all but useless, and will expose what is widely believed to be its true intention: prohibiting Adelson’s competitors from offering regulated online gambling. And as Chris Grove has detailed, because of the current online gaming landscape and the carveouts RAWA contains, the bill would more or less only prohibit legalized online poker. The problem with exempting an activity Las Vegas Sands participates in An exemption for mobile sports betting in Nevada would also make what is already considered crony capitalism look even more like a political favor for a billionaire donor. So far the exemptions don’t pose a conflict of interest with Adelson’s current gaming enterprise. But, exempting a business Sheldon Adelson profits from – Las Vegas Sands’ Nevada casinos do offer mobile sports wagering – would only serve to underline one of the key arguments opponents of RAWA have been screaming from the mountaintops. Namely, that RAWA is a protectionist piece of legislation designed to preserve Sheldon Adelson’s grip on gambling in Nevada. It also opens RAWA up to the most basic attack line imaginable. Why does Sheldon Adelson think online sports betting in Nevada is acceptable, but online poker is not? It doesn’t get much simpler than that. Image Nick_Nick / Shutterstock.com
At the 2014 World Series of Poker, Caesars and the WSOP made a concerted effort to merge their brick and mortar and online offerings. Among the crossover proposals the WSOP implemented were:
Players were encouraged to play online poker while playing in WSOP events.
The WSOP created a designated area for players to log on and play at WSOP.com.
WSOP.com in Nevada and New Jersey sent hundreds of players to the WSOP via official online satellites. Judging by the information relayed during last Tuesday’s 2015 World Series of Poker conference call, there will be an even stronger push at the 2015 World Series of Poker to create synergy between the WSOP and WSOP.com. Starting with the first-ever WSOP online poker bracelet. The online poker bracelet Event #64, a $1,000 buy-in No Limit Holdem tournament, will begin at WSOP.com’s online poker tables and play down to the final nine players. Once the final table is decided these players will travel to the Rio to battle it out for the bracelet the old-fashioned way. What else is in store for the 2015 WSOP Mobile and wifi improvements Last year, the WSOP encouraged players to play at WSOP.com while participating in WSOP tournaments at the Rio. But there was a major logistical issue that likely hindered players from taking advantage of this new, exciting opportunity. During the 2014 WSOP, WSOP.com didn’t have a mobile offering, and players interested in double-dipping in live and online tournaments would have to use their much bulkier laptops. This year players will be able to play on their phones and tablets. Additionally, the WSOP has made wifi available in all areas of the Rio, as well as getting the Nevada Gaming Control Board to “white-list” the Rio so players can be seated at the same cash game table or tournament table even if they are playing from the same IP address – usually a no-no in Nevada. Daily satellites WSOP.com will run satellite tournaments to the following day’s WSOP events every night at 6PM. Signature event (Ladies and Seniors Championship and Millionaire Maker, for example) satellites will start at 4 PM. Additionally, STT’s and Steps satellites to WSOP tournaments will be available around the clock. A bigger scramble One satellite tournament that was a rousing success in 2014 was the WSOP Main Event 25 seat Scramble. Last year the tournament attracted 1,339 entries, and the company expects even more entries this time around, with potentially more seats won. This year the tournament will have a slightly reduced price-point (185+15) and will allow players to reenter. The scramble will take place on Day 1a of the WSOP Main Event. Satellites to the 25 seat satellite are already running at WSOP.com. Streamlined deposit options Caesars also announced they have made it easier than ever to deposit into your online poker account. As always, players can use credit cards, eChecks (ACH), or cash at the cage. This last option has been streamlined by the WSOP. According to Caesars’ reps, players are now capable of walking up to the cage with their ID and making a deposit to their already setup online poker account. In the past players would first have to initiate an online chat before depositing at the casino cage. Additionally, Caesars expects the list of properties where the cash at the cage deposit option is available to grow from one to three, as they are awaiting approval for Harrah’s and Planet Hollywood to join Caesars. The return of direct buy-in satellites In 2014 Caesars sent about 200 players to the WSOP via direct satellites at WSOP.com – about 100 to the Main Event and a similar number to preliminary events. That number should be much larger in 2015. In addition to direct buy-in satellites at WSOP.com in Nevada and New Jersey, Caesars has teamed up with their iGaming partner, 888 Poker, who will be offering official direct buy-in satellites to the WSOP in regulated markets around the globe. According to Caesars, they expect 888’s direct satellites to send around 100 players to the Main Event. During the conference call, Caesars also announced they have entered into similar partnerships with PlayNow in Canada and Winamax in France. Caesars Interactive VP of Corporate Communications Seth Palansky, the WSOP expects over 200 players will win their way into the WSOP Main Event through these official satellites, and over 500 total WSOP seats (Main Event and preliminary events) to be awarded through official online satellites. By comparison, during last week’s call, Caesars estimated the 56 land-based casinos they have partnered with will send about 300 players to the Main Event. Tidbits
The Global Poker Index (GPI) will be sponsoring the 2015 WSOP Player of the Year award. the WSOP POY calculations had previously been handled by Bluff Magazine’s POY system. According to a press release by the WSOP, “… this new, multi-year agreement includes marketing initiatives for the World Series of Poker in Las Vegas and WSOP Europe… to include exclusive editorial content on WSOP.com and content within the WSOP final table livestream.”
For the first time, live reporting of WSOP tournaments will be handled in-house and exclusively available at on WSOP.com.
The GPI wasn’t the only company to enter into a multiyear agreement with the WSOP. According to Caesars, DraftKings extended their sponsorship of a WSOP event (Event #55) into multiyear agreement. Image NAN728 / Shutterstock.com