Could newly proposed amendments to California’s best chance for online poker legislation spell good news for PokerStars? The reported amendments, although not yet official, could allow PokerStars to qualify for a license because the cutoff date for suitability has been altered. The participation of PokerStars in California’s future online poker market has long been one of the main areas of contention between interest parties, and has been strongly opposed by the Pechanga/Agua Caliente coalition of tribes. The proposed amendments, first published by California gaming attorney, David Fried, could essentially make any operator who accepted wagers from US residents after December 31st, 2011 unsuitable for a license. This means that PokerStars, which exited the market, albeit not by choice, in April 2011, is eligible to apply for a license.
The amendment now reads: “… an applicant for a service provider license is unsuitable if… the applicant, or its corporate or marketing affiliate, accepted a bet or wager on any form of internet gambling, or engaged in a transaction relating to those bets or wagers, from a person located in the United States after December 31, 2011…”
Other proposals made to the Adam Gray-sponsored bill relate to taxation. A system has been proposed that would make the tax rate dependent on the size of the Golden State’s online poker market. Taxes will be paid based on the combined annual gross gaming revenue of all license poker operators as follows:
- Less than $150 million – 8.847%
- Between $150 – $250 million – 10%
- Between $250 – $350 million – 12.5%
- Over $350 million – 15%
While currently the bill calls for state land-based casinos and cardrooms to have been in business for five years in order to qualify to operate an online poker platform, the amendment drops that time requirement to 3 years.
With regards to the price of the online poker license fee that operators will need to pay initially, the amendment proposes an increase from $10 million to $12.5 million.
It is also stressed in the changes that AB 2863 will only see the legalization of online poker in California, and does not cover other casino games.
It could be as early as next week that AB 2863 heads to California’s Assembly Appropriations Committee. If there is any hope for the passage of the law, it means that the Assembly and the State Senate have to approve it by the end of August.
