The Washington DC Online Gambling Saga

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Since the passing of the UIGEA in 2006 there have been some bizarre events in the field of online gambling in the United States. The Kentucky domain name seizure comes to mind as does the New Jersey Governor's veto of a bill that had passed through the state Senate and House. However, the events that transpired in Washington DC surpass these by far.

In December 2010 the Washington DC passed a bill that allowed for legalization of online gambling and generation of revenues from it. The bill was a part of the budget for the District. In January 2011 Mayor Vincent Gray gave the law his consent. In the first week of April 2011 the period for Congress to object to the bill expired. Thus Washington DC became the first jurisdiction in the United States to have a law that legalized online gambling.

The implementation of online gambling rested with D.C Lottery, which had a 50-50 revenue-sharing agreement with Intralot USA for developing and managing the online gambling web site. In April 2010 Buddy Roogow, executive director of the D.C. Lottery, outlined the plans for implementing online gambling. A free to play online gambling web site would go live by July 1. By September 1 residents of Washington DC would be able to play for real money at a number of "hot spots" in the city. By the end of 2011, the technology that would restrict the online gambling to the geographic limits of Washington DC would be in place. Then adults in Washington DC would be able to gamble online from their homes.

In June 2011 details of murky machinations that were involved in the passing of the bill began to surface in the press. It was alleged that the online gambling bill sponsored by independent councilor Michael A. Brown was slipped into the supplemental budget enacted in December 2010 without any public hearing or public debate or committee review. It was also alleged that Brown had failed to disclose that he was employed by a legal firm whose clients had interests in online gambling.

Reacting to these reports Council member Jack Evans scheduled a hearing to discuss both the issues raised in the press. In the meeting Washington DC Attorney General Irvin Nathan confirmed that the online gambling proposal was legal beyond doubt. Councilor Brown said that the bill was introduced four months before it was voted on and hence allegations of it being slipped in last minute are unfounded. Roogow explained how the issues of underage gambling and problem gambling were being taken care of. It was then decided that D.C. Lottery should hold public hearings to give the people and concerned organizations a chance to record their views on the intrastate online gambling proposal.

In August 2011 there were further revelations in the press that adversely impacted the Washington DC online gambling proposal. According to the requirements Intralot had needed a local partner in order to be awarded the contract. Intralot tied up with Veterans Services Corp owned by Emmanuel Bailey. There was no competitive bidding process and Bailey's name was allegedly suggested by some members of the Washington DC Council. On the basis of these reports Wells introduced a bill seeking to repeal the online gambling law.

By the end of November D.C. Lottery completed the public consultations. Roogow reported that there was no opposition to online gambling. Despite this, the Washington DC Council went ahead with the bill introduced by Wells and in February 2012 it was passed, repealing the online gambling law. It seems that the opposition was to the Intralot deal, but online gambling was made to suffer.

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