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New York Legislators Take Another Crack at Legal Online Poker

Online Poker New York

It appears that fully legal online poker is once again being considered in New York.

New York Assemblyman Gary Pretlow, who has been pro-online poker in the past, introduced a new bill this week that would reclassify poker as a game of skill.

Classifying poker as a game of skill would have long-reaching ramifications for online poker regulation because it would give the state the ability to avoid amending its constitution. That would streamline the entire legalization process.

It appears that support for legal online poker in New York is building as Pretlow’s bill is the second pro-online poker bill that has been introduced in the last 30 days.

Sen. Joseph Addabbo introduced a different bill to the state senate last month that would also legalize and regulate online poker.

Both bills would reclassify poker as a game of skill.

No ‘Bad Actor’ Clause in New Bill

One of the chief ways that Gary Pretlow’s bill differs from the earlier one spearheaded by Sen. Joseph Addabbo is that it doesn’t include a “bad actor” clause.

The bad actor clause is a catch-all term that legislators have used to designate online poker sites like PokerStars that didn’t leave the U.S. market after the government passed the Unlawful Gambling Enforcement Act in 2006.

PokerStars as well as sites such as Full Tilt Poker and UltimateBet remained operational in the U.S. and garnered huge profits until the Department of Justice seized the aforementioned companies’ domains in 2011 and indicted members of their respective management teams.

PokerStars eventually made a $731-million settlement with the DoJ that saw it take over assets of the beleaguered Full Tilt Poker. As part of the settlement, all charges against the company were dropped.

Eventually PokerStars returned to the U.S. market in 2016 when New Jersey become the first (and thus far only state) to allow the online gaming giant to operate.

Allowing PokerStars has been a contentious issue in online gaming legislation and a state like Nevada, which does allow online poker, has kept PokerStars locked out. Pretlaw’s bill would require operators to pay a one-time $10-million application for all operators.

Pivotal Market for Online Poker

New York represents arguably the single most important market for legal online poker outside of California.

The massive New York population of 20-plus million would instantly make it the biggest online poker market in the USA and the massive tax revenue from such a venture could inspire other states to come on board.

For online poker sites to be successful, they generally have to hit a critical mass of players. More players means more games and tournaments and New York is one of the few states that could single-handedly support a healthy poker ecosystem.

Poker has a long, storied history in New York City where underground clubs have been frequented by athletes like Alex Rodriguez. Many iconic poker pros, such as Erik Seidel and Howard Lederer, also got their start in the underground games of NYC.

The East Coast of the USA is becoming a hotbed of poker activity as New Jersey is currently the biggest legal poker market but will be eclipsed when Pennsylvania officially goes online later this year.

The real tipping point for online poker in America may come when New Jersey, Pennsylvania and potentially New York start sharing players. New Jersey and Nevada have already entered into a compact that allows players from each state to compete against each other.

West Virginia Also Introduces Online Gambling Bill

New York isn’t the only state that has its eyes on potential tax revenue from online gambling.

Earlier this week news broke that a bipartisan group of lawmakers in West Virginia has introduced a bill that would legalize online gambling in the state.

The bill would be similar to the sports betting legislation that went into law last year. It would allow casinos in the state to operate online gambling sites along the same lines.

Five-year online gambling licenses in the state would cost $250,000 and would be taxed at a 10 percent rate. If the bill passes, most casinos would likely strike deals with online poker operators to offer games in the state.

Interestingly the new bill also does not have any bad actor language, which means PokerStars would potentially gain access to the market. Last year PokerStars signed a 20-year partnership deal with El Dorado Resorts. El Dorado owns the Mountaineer Casino Racetrack & Resort in West Virginia.

Regardless it appears there is a good chance that at least one more U.S. state will enter the online poker market in the next couple of years.