New regulations for the charitable poker industry in the state of Michigan have gone into effect as of this week, but those new rules may be struck down by legislation if the Michigan legislature has its way.
According to CBS Detroit, the new regulations that had been suggested by the executive director of the Michigan Gaming Control Board, Rick Kalm, went into effect on Wednesday, basically limiting the “millionaire parties” that can be held by the charitable poker rooms in the state. Instead of being able to operate seven days a week, the charitable poker rooms can now only operate 208 days out of the year, or four days per week. No more than two “millionaire parties” can be held each day and the revenues from said tournament are now split 55%/45% (with the charities receiving the larger amount) rather than the 50-50 split that had previously existed.
These changes could be short-lived, however, if the Michigan legislature has anything to say about the subject. In response to Kalm’s heavy handed approach to regulating the charitable poker industry in the Wolverine State, Michigan State Senator Rick Jones introduced a bill in April, S. B. 878, that would remove many of the new rules that have been set in place. There would be no regulation as to the number of days that poker rooms could operate and it would also open up Michigan’s racetracks to join the industry. It would also confirm the industry’s right to exist, something that has been under attack by the MGCB and Kalm with the license freeze and closure of rooms over the last three-plus years.
The Jones bill passed through the Senate rather quickly, but the House has been the area where it has bogged down a bit. On the same day that the new regulations went into effect in Michigan, a House committee held its first hearing on the subject. Even if the House were to pass the Senate bill as it stands, there is some consternation in the charitable gaming industry that Michigan Governor Rick Snyder may veto any proposal that comes from the legislature.
Jones commented on his bill to CBS Detroit, stating, “The rules don’t allow enough games to take place so enough charities can be served so the room can make enough money. (The rooms) need to make enough to exist.” A spokesman for House Speaker Jase Bolger indicated that at least one more hearing on the subject would be held (saying that the first hearing brought about “good discussion”), but it was unclear whether Bolger would bring it to the House floor for a vote.
The Jones bill has drawn support from the players and poker rooms due to its relaxed regulations (for example, the daily limit on chip sales per charity would increase from $15,000 to $20,000 and, if a charity was able to run the games themselves, chip sales could increase to $50,000) and its 24/7 allowance for the games to take place.
The impact of the charitable poker industry in Michigan is a significant one. In 2002, revenues of $7.9 million were reported to the state; ten years later, that profit had ballooned up to $184 million. The rooms weren’t the only winners in this case, as the charities saw their take of the action rise from $3.6 million in 2002 to $15.8 million in that same time span.
The battle over the charitable poker industry has been more than three years in the making. Since 2010, no new rooms have been licensed (coinciding with the MGCB taking over its oversight) and nearly 40 rooms have been closed for a variety of restrictions that include illegal gambling, payment of dealers by the players, liquor law violations and an assortment of more serious crimes such as armed robbery, assault and fraud. While both sides state that regulation is necessary, how to reach those regulatory goals still seems to be out of reach.
I am a poker player, it is my job, and I want to know what right state or federal governments have to restrict my ability to make a living. There are already a sizable number of US players who have fled to other countries so that they can more easily play online. There is a Poker Refuge Center (yes, that’s the real name) in Canada.
What is the problem with poker? It’s not illegal. I’m not gambling against “the house.” I play tournaments against other players, I play an entry fee to play, and the players who finish highest win the money, with first place usually getting about 25% of the prize pool.
When I play chess tournaments, I pay an entry fee, I compete against other players, and the players who finish with the most points (one point for a win and half a point for a draw) win the money.
Please explain why poker is regulated so heavily and chess is not.
Poker is a legitimate profession. Professional Poker Player is a US Department of Labor job classification. To become a better player, I watch how my opponents play. I keep up with the latest poker theory through books and online forums. I make decisions based on probabiliy, statistics, and game theory.
So, what happened when I took a risk, become self-employed and tried to make a living playing poker? First, the US imposed banking regulations which made it very difficult to stay in the US market. It is so bad that even though my bank agreed that there is no legal problem, “we just don’t want to mess with it.” My bank, where my wife and I already have three accounts, will not let me open an account for my poker business, whether or not it is designated as a business account.
The current choices for online play are very poor, and the games don’t run often enough for many players to make a decent living. The proposed state regulations of charity poker will do the same thing. This is an attempt to regulate a legitimate business, which many players depend on for their living, out of the market.
Let me address just one of the ridiculous regulations.
Charity rooms will have to cut back from being open from 7 days to 4. Why? What other business is regulated that way? If your business had the usual fixed monthly costs (rent or property taxes, for example) and you were told that you could only open three days a week, how would you react? You might have to consider closing your doors. That is what the charities, the small business owners that run the charity poker rooms, and the players are all facing.
Don’t do this to me! Poker is my job. There isn’t much left for me online, and the charity room 10 miles from my house soon might not be a viable option.
I am in a family rotation to help take care or a 92-year-old relative. I can’t drive 100 miles to the nearest casino and stay for the weekend any time I feel like it. Even if I could, it would be much more expensive than my local poker room, where I can play any day of the week, I can bring my own food and drink, and the only costs I have are the tournament entry fee plus a few dollars for gas.
The proposed regulations need to be relaxed, as the state senate has already voted to do. I urge every member of the house to vote that way as well. Republicans are supposed to be pro-business. Now is the time to prove it.
PPA represetative:
I appreciate everything that the PPA is doing, and your comments about my post above. I regret to inform you that I lost your 2+2 message. If you could resend, I would appreciate that very much.