Online gaming measure advances in Assembly

CARSON CITY -- A Nevada legislative panel Tuesday approved a bill that would pave the way for the Silver State to set the standard for Internet gambling.

Assembly Bill 258 directs the Nevada Gaming Commission to start drafting rules to regulate online poker but states that Internet gambling would not be implemented until sanctioned by Congress or the Justice Department.

"This says Nevada can get ready to go," Pete Ernaut, representing the Nevada Resort Association, told the Assembly Judiciary Committee. "It can do its rule-making; it's directing the commission to go now."

"We believe online poker is inevitable," Ernaut said. "We wanted a bill that made sense ... for the existing gaming industry and the online poker industry."

The measure, sponsored by Assemblyman William Horne, D-Las Vegas, moves to the Assembly floor.

The bill "encourages Congress to enact legislation clarifying state and federal laws governing Internet poker" and providing for licensing.

The measure states that any rules adopted by Nevada will not permit online gambling until permissible by federal law.

Several states are pushing their own bills to set up online gambling after U.S. Sen. Harry Reid's attempt to set federal rules on the quasi-legal industry fell flat last year.

The District of Columbia on Tuesday became the first U.S. jurisdiction to allow Internet gambling, moving ahead of gaming meccas New Jersey and Nevada.

A provision permitting the District of Columbia to offer online gaming within its borders was included in the 2011 budget. A 30-day period for Congress to object to the measure expired last week.

Efforts to legalize Internet gambling have stalled elsewhere, including in New Jersey, where Gov. Chris Christie vetoed a bill.

Under the Nevada bill, online sites would need to have a partnership with an existing nonrestricted license holder or an affiliate that has been in business for at least five years.

The resort association, which represents the big hotels on the Strip, opposed the original bill over fears online gambling would take business from brick-and-mortar casinos.

"It's a matter of job protection and investment protection of the existing Nevada gaming industry," Ernaut said.

One economist estimated Nevada could collect between $2 million and
$3.4 million in taxes annually if online poker is legalized and up to $65 million if it captured a quarter of the international market.