CA iGaming Wars Heat Check: Jones-Sawyer iPoker Bill Now Includes Racetracks, Modifies Bad Actor Provisions.

Internet Poker Consumer Protection Act of 2015 (CA AB No. 167 — Jones-Sawyer)

The Bill’s author commented that “[u]nder AB 167, [the Bill’s] authorized entities, which include tribal gaming facilities, licensed cardrooms and [now] in-state horse racing associations, must undergo an extensive determination of suitability process by the Department of Justice before they are able to apply for an operator license.”

   AB 167, as introduced, Jones-Sawyer. Gambling: Internet poker:
unlawful gambling activity.
   (1) Existing law, the Gambling Control Act, provides for the 
licensure of certain individuals and establishments that conduct
controlled games, as defined, and for the regulation of these 
gambling activities by the California Gambling Control Commission.
The Department of Justice has related investigatory and enforcement
duties under the act. Any violation of these provisions is punishable
as a misdemeanor, as specified.
   This bill, which would be known as the Internet Poker Consumer
Protection Act of 2015, would establish a framework to authorize
intrastate Internet poker, as specified. The bill would authorize
eligible entities to apply for a 4-year license to operate an
authorized poker Web site offering the play of authorized Internet
poker games to registered players within California, as specified.
The bill would require that the license be automatically renewed
every 4 years upon application, as specified. The bill would prohibit
the offer or play of any gambling game provided over the Internet
that is not an authorized Internet poker game permitted by the state
pursuant to these provisions. The bill would provide that it is
unlawful for a person to aggregate computers or any other Internet
access device in a place of public accommodation within the state,
including a club or other association, or a public or other setting,
that can accommodate multiple players to simultaneously play an
authorized Internet poker game, or to promote, facilitate, or market
that activity. The bill would provide that any violation of the
Internet Poker Consumer Protection Act of 2015 is punishable as a
felony. By creating new crimes, the bill would impose a
state-mandated local program.
   This bill would require the commission, and any other state agency
with a duty pursuant to these provisions, to adopt regulations to
implement the provisions within 270 days after the operative date of
this bill, in consultation with the department and federally
recognized California Indian tribes, and to facilitate the operation
of authorized poker Web sites and expedite the state's receipt of
revenues. The bill would require an eligible entity, as defined, to
pay an application processing fee sufficient to cover all reasonable
costs associated with the review of the entity's suitability for
licensure and the issuance of the license, for deposit into the
Internet Poker Fund, as created by the bill, to be continuously
appropriated to the department and the commission in the amounts
necessary to perform their duties pursuant to this bill. The bill
would require an entity seeking to act as a service provider to apply
for a service provider license, employees of a licensed operator or
a licensed service provider to obtain employee work permits, and
owners, officers, and directors of a licensed operator to be subject
to a suitability review and obtain employee work permits. The bill
would establish a tribal gaming regulatory authority process for the
purpose of processing tribal employee work permits, and authorize a
tribe that is a licensed operator to elect to participate in the
tribal gaming regulatory authority process.
   This bill would require the payment of an annual regulatory fee,
for deposit into the Internet Poker Fund, to be continuously
appropriated for the actual costs of license oversight, consumer
protection, state regulation, and other purposes related to this
bill. The bill would require each licensee to pay a one-time license
deposit into the General Fund in the amount of $10,000,000. The
license deposit would be credited against quarterly fees equivalent
to 8.5% of the licensee's gross gaming revenue proceeds, as
specified. The bill would require an applicant for an operator
license to provide documentation establishing that the applicant is
qualified to pay the one-time license deposit through its own net
position or through credit directly to the applicant, as specified.
   This bill would establish the Unlawful Gambling Enforcement Fund
within the General Fund for purposes of ensuring adequate resources
for law enforcement charged with enforcing the prohibitions and
protections of the provisions described above. The bill would
authorize the Attorney General, and other public prosecutors, as
specified, to bring a civil action to recover a civil penalty in an
unspecified amount against a person who engages in those prohibited
activities described above, or other specified unlawful gambling
activities. The bill would provide for an unspecified percentage of
revenues from civil penalties collected to be deposited into the fund
and used for law enforcement activities pursuant to these
provisions, upon appropriation by the Legislature.
   This bill would require the commission, in consultation with the
department, the Treasurer, and the Franchise Tax Board, to issue a
report to the Legislature describing the state's efforts to meet the
policy goals articulated in this bill within one year of the
operative date of this bill and, annually, thereafter. The bill would
also require the Bureau of State Audits, at least 4 years after the
issue date of any license by the state, but no later than 5 years
after that date, to issue a report to the Legislature detailing the
implementation of this bill, as specified.
   The bill would provide that specified provisions are not
   (2)Existing constitutional provisions require that a statute that
limits the right of access to the meetings of public bodies or the
writings of public officials and agencies be adopted with findings
demonstrating the interest protected by the limitation and the need
for protecting that interest.
   This bill would make legislative findings to that effect.
   (3)The California Constitution requires the state to reimburse
local agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
   This bill would provide that no reimbursement is required by this
act for a specified reason.
   (4)This bill would declare that it is to take effect immediately
as an urgency statute.

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