Online Poker Bill Proposed in Iowa

Posted on January 28th, 2013 by Todd Wilkins

Online Poker Bill Proposed in IowaAlthough an online poker bill failed to gain support in the Iowa House of Representatives last year, Sen. Jeff Danielson has introduced a new bill this year.

Danielson has garnered support from fellow Democrat Sen. Wally Horn and Republican Sen. Randy Feenstra. The trio are asking their colleagues in the General Assembly to look at Iowa Senate Study Bill 1068. The measure is similar to 2011’s Senate Study Bill 1165, which sought to establish particular requirements for the issuance of intrastate Internet gambling licenses.

Iowa lawmakers use study bills to gauge how well their proposals may be received by their House and Senate counterparts. A study bill is normally presented to a committee following sponsorship. Should a committee approve of the measure, the next step would be an introduction to one of the two chambers of the General Assembly for debate.

In March, 2012, the Iowa Senate voted 29-20 in favor of Senate File 2257, which would have allowed existing gambling license holders to offer online poker within state borders. Voting on the bill concluded in about ten minutes and took many legislators by surprise when those lawmakers opposed did not express their opinions on the issue. The bill was then passed from the Democratic majority Senate to the Republican-controlled House, who did not see the merits of the bill in the same light. The House did not even bring the matter up for a vote, allowing the proposal for online poker in Iowa to fall by the wayside in 2012.

The Iowa Senate vote approving online poker came just a few months following the U.S. Department of Justice’s ruling in December, 2011, that found the 1961 Wire Act to be applicable only to sports betting. Had the Iowa House of Representatives followed suit and voted in favor of the measure last March, Iowa could have been in the race with Nevada to be the first state to offer legal online poker in the U.S. As a result, Iowa has been forced back to square one with Senate Study Bill 1068, while the Silver State expects to go live with the first Internet poker sites later this year.

Senate Study Bill 1068 does include a bad actor clause that forbids the issuance of a license to any service provider who has accepted wagers in violation of the laws of any jurisdiction where the service provider operated. Such a provision was recently removed from legislation in New Jersey that has been approved by the state legislature and now awaits only the signature of Gov. Chris Christie to become law. PokerStars, the world’s largest online poker site, has recently made a bid to purchase an Atlantic City casino. PokerStars continued to operate in the U.S. following the enactment of the Unlawful Internet Gambling Enforcement Act (UIGEA) in 2006 and may be in violation of such a bad actor provision. However, that issue has not yet been argued and determined in a U.S. District Court.

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