Pechanga-led group enters Cali online poker fray
New online poker bill has backing of eight influential tribes and is seen as the most protectionist to date
A coalition of powerful Californian tribes led by the Pechanga Band of Luiseño Indians is poised to introduce new online poker legislation, as part of what appears to be the most protectionist set of proposals seen to date, eGaming Review can reveal.
The new bill is backed by eight influential tribes, including the Agua Caliente Band of Cahuilla Indians, the Temecula Band of Luiseño Mission Indians, and the Barona Band of Mission Indians.
Under the proposals the number of licences the state can issue is unlimited, tax rates would be quarterly fees amounting to 5% of an operator’s gross gaming revenue, while one-off licence fees would be set at US$5m.
These aspects of the bill appear more attractive to operators than previous incarnations. A recent version of Senator Lou Correa’s SB678, for example, set the licence fee at $10m and tax at 10% of GGR, while an earlier draft initially limited the licences to five and set the licence fee at $50m each.
However experts are calling the bill “ which would prevent the state from entering into compacts with other US or international jurisdictions “ the most protectionist to date.
Licensed operators would also be limited to running just one poker skin, unlike in New Jersey where they can operate up to five sites on one licence. That move has allowed the likes of 888 and PartyPoker to launch their own brands while providing poker software to their licensed partner.
Only tribal governments and licensed card rooms that have been in business for at least five years would be allowed to apply for an internet poker permit.
A “bad actor” clause would bar any operator, or its affiliates, who accepted online wagers from players in the state before the bill was passed into law. It would also block any federally recognised California tribe that had accepted wagers from players located within the state, but not physically present on Indian lands when making the bet.
“In many ways the protectionist measure makes sense. Controlling the number of operators ensures that the market remains sustainable and the liquidity intact,” online gambling consultant Mario Galea told eGaming Review.
Last month eGR North America reported that California’s two internet poker bills “ SB51 and SB678 “ had died as part of the state’s legislative process.
They, along with the new Pechanga bill, are set to be reintroduced under different numbers before the deadline for the next legislative session on 21 February.
Later this month a number of Californian tribes are set to meet at an egaming legislative forum, with some industry insiders predicting the conference will lead to a streamlined bill including elements from SB678 and the Pechanga bill.
The new draft will likely add to the momentum which has gradually been building in the state, with several tribes signing tentative agreements with platform developers and suppliers.
The United Auburn Indian Community has a deal in place with bwin.party, while Caesars has a long standing agreement with the Rincon Band of Luiseño Indians.
According to a study by Eilers Research, the California internet poker market could be worth $439.4m a year by 2020.