Online Poker Bill Introduced in New York

Senator John BonacicThe chances that New York State will have a regulated online poker market has just received a very big boost as an online poker bill has been introduced within the state of New York by Senator John Bonacic, a pro-internet gambling Republican.

This is a big deal with New York being the third ranked U.S. state in terms of population with 20 million residents and a big online poker pool to tap into. The poker specific bill wants to amend New York State’s racing, pari-mutuel wagering and breeding law and the penal law in relation to interactive poker gaming regulatory language.

As it stands, the online poker bill looks to distinguish the game of poker from other “games of chance”, and if passed, it would effectively allow for New York residents to play online poker cash games and tournaments.

In 2013, a New York Federal Court decided that poker is predominantly a game of skill rather than chance. “New York courts have interpreted New York law to apply a more rigorous test in identifying a “contest of chance” than is applied by most states in this nation and the courts have found that where a contest pits the skill levels of the players against each other, those games are games of skill and not games of chance. Furthermore, the courts have not limited the legislature’s ability to determine that certain forms of poker should fall outside the general definition of gambling since those games are games of skill,” the bill explains.

The proposed bill allows for ten online poker licenses. The cost of each license is $10 million and would expire after ten years. Any licensee would have to pay a tax rate of 15% of gross online gaming revenue. In addition, the bill also allows the state to enter into online poker compacts with other states, provided that they are not classified as “Bad actors.” That is fantastic news for states including Nevada and Delaware, who have already entered into an agreement to allow online poker players in each state to play against each other.

The section of the bill that references “Bad Actors” is referring to online poker operators who continued to offer their poker games in the United States following the UIGEA that was passed in 2006. Senator John Bonacic’s bill would prohibit online poker sites such as PokerStars from obtaining a license in the state of New York, but more than that, should “Bad Actors” be able to obtain a license in other regulated states, it would prevent online poker operators in New York from sharing a database of poker players with them.

There would have been a few surprised looks on the faces of many people in the industry when the poker bill was introduced to the New York State Senate last week, not only because New York has always been of the view that poker is a game of chance and constitutes gambling, but because the bill was introduced by a Republican in the House at a time when Sheldon Adelson is spending huge sums of money in his campaign against online gambling.

With a New York Federal Court already deciding that poker is a game of skill, there is a good chance that this poker-only bill will be passed, providing a great source of revenue for New York State. The bill has moved onto the Senate Committee on Racing, Gaming and Wagering – of which Senator Bonacic is chair. Should it pass the second hearing it shouldn’t take long at all for the bill to be enacted.