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Poker Supporters Eye Lame-Duck Session

Reid-Kyl cooperation runs afoul of politics

Poker Supporters Eye Lame-Duck Session

With one month to go before the presidential and general election is held in the U.S., some experts believe the action on an online poker bill will ramp up in the aftermath. In September, a draft of a potential legalization measure agreed to by Senate Majority Leader Harry Reid (D-Nevada) and Senator Jon Kyl (R-Arizona) was circulated. It was the first indication that there was ongoing cooperation between the two.

The high points of the proposed bill showed it would be very tough on illegal gambling websites in the U.S.—along with U.S. players frequenting those sites. One of the elements called for confiscation of player deposits if a site is seized and shut down.

But that’s not the only part of the bill that raised the hackles of the poker advocacy group Poker Players Alliance. Particularly irksome is a clause that prohibits online casinos that accepted U.S. bets after the passage of the Unlawful Internet Gambling Enforcement Act (UIGEA) from operating in the U.S. for five years from passage of the bill. PPA, which was principally funded by PokerStars and other online gaming sites, objected to that clause.

“We believe the five-year penalty box aimed to keep companies like PokerStars out of the U.S. market seems unduly unfair,” John Pappas, the executive director of PPA, said. “They should have the ability to partner with other U.S. gaming companies to offer what players believe is a very good service in the U.S.”

Pappas is OK with a clause that delays operations of online casinos for 15 months in order to give tribes a chance to “catch up” with states that have already started the legalization and licensing process. The time frame is also designed to allow the Commerce Department, which would oversee online poker, to set up regulations and licensing schemes, but Pappas believes that timeline is too lengthy.

“I don’t think it should take the Department of Commerce that long to form regulations when other countries and states have already achieved successful regulations,” Pappas said. “Fifteen months seems exceedingly long. They should try to shorten it to a more reasonable time.” Pappas suggests six months should be enough.

But there still is no guarantee that the bill will ever be considered. A dispute between Reid and fellow Nevada Senator Dean Heller threatens to prevent the majority leader from gathering the 60 votes he needs.

Reid called the bill “the most important issue facing Nevada since Yucca Mountain,” the infamous battle to keep a nuclear waste depot from being established in the state, and accused Heller of not working for his constituents—in this case, the casino companies.

Heller believes the House of Representatives should take the first action, and claimed that Kyl and Reid agreed. Not so fast, said Reid spokeswoman Kristen Orthman, who called it a “bald-faced lie.”

Heller wants to keep politics out the internet poker bill, especially since he’s in a tight race for re-election with Rep. Shelley Berkley, a popular congresswoman and Reid protégé. (Heller was appointed to finish the term of the disgraced John Ensign, who resigned last year.) He says he’s ready to help Reid after the election, but doesn’t appreciate Reid’s attempts to “poison the water.”

Kyl, a longtime gaming opponent, has bought into the argument that you can’t stop online gaming, so he’ll agree to legalize online poker if there can be a strict prohibition against other gambling online.

“My personal view is that internet gambling poses a real danger to our society,” Kyl said. “And if one state doesn’t want it, it’s very nearly impossible to stop if it’s on the internet.”

The casino industry, meanwhile, has put all its chips on Reid. While the American Gaming Association would not comment on the Heller-Reid dispute, an unidentified casino executive told Politico, “We’re trusting that Harry knows what he’s doing. If he doesn’t, we are so screwed.”

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