With the introduction of a new online poker bill on February 19, just squeaking in ahead of the legislative deadline to introduce bills for 2016, California Assemblyman Adam Gray insured that online poker will remain a hot topic in the Golden State for a large part of 2016.
Even though Gray’s bill managed to meet one legislative deadline, several others are still looming, with the bill’s path forward beginning with a three-part process in the Assembly.
The Assembly process
The first step for Gray’s online poker bill (AB 2863) will be a hearing or hearings in front of the Governmental Organization Committee chaired by Gray, and a vote passing the bill out of committee. The hearing(s) and vote will have to take place before April 22, as this is the last day for policy committees to hear and report fiscal bills.
Essentially, the GO Committee will need to pass AB 2863 and send it on to the Appropriations Committee on or before April 22.
CaliforniaOnlinePoker.com has been told that the when he introduced his new bill, Gray solicited comments and input from the state’s varied interest groups that have a stake or interest in online poker. How far apart the state’s tribes and card rooms are on the key issues will likely determine when, and perhaps even if, a hearing is held. Several public statements have also alluded to these letters sent to Assemblyman Gray.
Step two requires AB 2863 to pass the Appropriations Committee. The last day for fiscal committees (Apropos) to hear and report on AB 2863 is May 27. If the Apropos Committee doesn’t vote on the bill by May 27, thereby sending it to the Assembly floor, its future becomes very suspect.
The final step (in the Assembly) is for the full California Assembly to pass AB 2863 with a two-thirds majority on or before June 3.
AB 2863 post-Assembly
If Gray’s online poker bill manages to take the next step (the bill made it to step three in 2015 but never received a vote on the Assembly floor) it would then head over to the California State Senate, where the measure would need to be passed by August 31.
If AB 2863 were to pass the Assembly and Senate (the same version must be passed in both houses), it would then land on Governor Jerry Brown’s desk, and he would have until September 30 to sign the bill into law.
Where California tribes and card rooms currently stand
So how likely is any of this to occur?
The answer to this question depends largely on whether or not the state’s tribal gaming interests can make progress on the two key issues that have stymied online poker expansion for several years: bad actor clauses and the role the horse racing industry will play in the market.
The good news is Gray’s new bill is far more detailed than his 2015 shell bill, and includes a potential solution to one of the two major issues, with its proposed $60 million annual allocation of money to the state’s horse racing industry. There are also far fewer entities clinging to the bad actor position, due to the changing zeitgeist surrounding PokerStars. Gray’s bill doesn’t contain bad actor language.
However, it appears, based on its most recent comments, the Pechanga coalition is not ready to set aside its opposition to PokerStars, and even if the horse racing hurdle is cleared, bad actors could still stall online poker.
There are three potential outcomes for AB 2863:
- If stakeholders remain apart on the fundamental problems of the horse racing industry and/or bad actor clauses, the bill may not even make it out of the Go Committee in 2016, and might not even get a hearing.
- Conversely, if there is some give and take between the two main coalitions, and a full compromise is reached, the bill could steamroll through the legislature, and California could (finally) have legal online poker.
- All that being said, the most likely outcome, in my opinion, is that the two sides will come a bit closer in 2016, but fail to reach a consensus. If this happens, I suspect the bill might achieve or even surpass Gray’s 2015 bill in terms of movement through the state legislature (the 2016 bill passed the GO and Apropos Committees), but fall short of passing the full Assembly or Senate.
The introduction of a detailed bill ( something the state has been doing for near a decade) doesn’t solve the fundamental problems that have prevented California from legalizing online poker, as we still don’t know where the various interests stand on the annual subsidy to the horse racing industry, nor do we know how resolute the Pechanga tribe and its allies are when it comes to bad actor and/or tainted asset language.