New York Online Poker Bill Passes First Senate Committee by Unanimous Vote

When New York State Senator John Bonacic once again introduced a bill to legalize and regulate online poker in the state in late January, it was expected that it would get through the Senate’s Committee on Racing, Gaming and Wagering fairly quickly. That expectation was correct. On Tuesday, Bonacic’s bill, S 3898, passed by a unanimous 11-0 vote and has now been advanced to the Senate Finance Committee.

The purpose of the bill, as stated on the bill’s webpage on the New York State Senate website, is quite simple:

To authorize the New York State Gaming Commission to license certain entities to offer for play to the public certain variants of internet poker which require a significant degree of skill, specifically “Omaha
Hold’em” and “Texas Hold’em.”

It also “….includes definitions, authorization, required safeguards and minimum standards, the scope of licensing review and state tax implications; makes corresponding penal law amendments.”

Some of the bill’s key points:

•    Permits the state to enter into interstate gaming compacts so that player pools can be combined.
•    15 percent tax on gross gaming revenue
•    A maximum of ten licensed operators who must pay a licensing fee of $10 million each. Licenses would be good for ten years.
•    Most forms of poker would be authorized, even though the above “purpose” statement only mentions hold’em and Omaha.
•    When and if the bill is signed into law, there will be a 180-day grace period before licenses can be issued and games can start, likely to make sure the state is properly prepared.
•    Operating an online poker site without a license is a crime. Unlicensed operators will be both fined and taxed.

Needless to say, if New York got an online poker industry up and running, that bit about interstate compacts being allowed is enormous. One would think that Nevada and Delaware, who have an agreement to share player pools, would be on the phone with New York immediately to try to get the Empire State on board. As readers of this site likely understand, online poker is all about player liquidity. Lots of players means active tables means more revenue. And the more activity the tables have, the more attractive the sites look to prospective players, resulting in more people signing up and the activity becoming even greater.

The reverse is also true: low activity leads to less attractive poker rooms leads to fewer signups and ultimately exiting players. Nevada and Delaware have fewer than 3 million residents between them (estimated) and can barely keep poker rooms going. New York, on the other hand, has nearly 20 million residents plus tons of visitors for both work and tourism every day. A combination with New York would do wonders for Nevada’s and Delaware’s online poker business.

Bonacic has made the regulation of online poker one of his primary focuses in the last several years, but obviously has never been able to get it done. His bill conquered the Senate easily last year, passing by a 53-5 vote, but was never voted upon in the Assembly.

Bonacic feels more confident this year, telling GamblingCompliance (premium content ahead), “Last year, there was too much gaming for the Assembly to consider with fantasy sports and the efforts in New Jersey for a referendum to put a casino in the Meadowlands, and I really think that it got put on the back burner. So now we are putting it in the front burner.”