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Howard Stutz

State lawmakers group opposes bill to ban online gaming

4 April 2014

LAS VEGAS -- An organization of state lawmakers said Thursday it opposes a bill in Congress that would restore a ban on online gaming.

In a letter to the congressional leadership and copied to all members of Congress, the National Conference of State Legislatures said the organization expresses strong opposition to the Restoration of America’s Wire Act, which was introduced last month by Sen. Lindsey Graham, R-S.C., and Rep. Jason Chaffetz, R-Utah.

State Sen. Bruce Starr of Oregon, the organization’s current president, and Nevada State Sen. Debbie Smith of Reno, the current president-elect, said in the letter that Congress should “respect the sovereignty of states” in deciding if they want to participate in online gaming.

“States have proven that they are effective regulators of the gambling industry, and the proponents of this legislation fail to make a case that we have been negligent in our responsibilities to the industry and consumers,” the letter said. “This attempt to enact a wholesale prohibition of online gambling with the Restoration of America’s Wire Act is merely a solution seeking a problem.”

The bill seeks to reinstate federal law to prohibit “all forms of Internet gambling.” It comes in the wake of a December 2011 Justice Department opinion that the relevant law, the Interstate Wire Act of 1961, covers only sports betting.

That opinion dramatically changed the landscape, sparking moves by states, casino interests and technology vendors to explore online markets. Nevada, New Jersey and Delaware have legalized forms of in-state online gaming. Some 10 states are considering legalizing the activity.

The letter stated that states, including Utah and Maine, have taken steps to forbid online gaming.

“This is the way it should work, each state making the decision that is best suited to the desires of its residents and not through a congressional mandate,” the letter said.

The legislation does not contain a grandfather clause that would permit Nevada, New Jersey and Delaware to continue offering online gaming, and it would bring to a halt the recent Nevada-Delaware agreement to pool online poker.

Those states and any others would be required to get Congress to sign off.

Nevada Gov. Brian Sandoval expressed his opposition to the legislation.

The Graham-Chaffetz legislation tracks the goals of billionaire Las Vegas casino owner Sheldon Adelson, who has financed lobbying campaigns in Washington and in various states to stem the growth of online gaming and roll it back wherever possible.

An early draft of an online gambling ban that circulated on Capitol Hill was written by a registered lobbyist for Las Vegas Sands Corp., Adelson’s company.