US States Consider Online Gambling

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A recent court order in the case of iMEGA versus the Department of Justice stated that the UIGEA cannot be a federal law against online gambling. It said that the UIGEA would be applicable only in those states where online gambling is illegal. Therefore the scene has now shifted to the individual states and many of the states are contemplating taking a call on this issue. Last week there have been reports from the states of Maine and Florida.

Like elsewhere in the United States, Maine too has had to cut its spending due to the financial crunch. In order to avoid further budget cuts the state legislators are contemplating gambling options such as online keno. This was reported by Maine Public Broadcasting. Dan Gwadosky, director of the Maine lottery, said that legalizing online keno would bring in additional $2.4 million annual revenue. He said that keno works like Powerball, but with more frequent drawings. The opponents of online gaming have put forward arguments to show that online keno would not be a good idea. They dispute that online keno would bring in additional revenue. It would only divert revenue from existing legal gambling options so in the net effect the state would not earn anything more. Gwadosky responded to this by stating that keno was a different game so it would attract a different player. However he added, "There's only so much disposable income out there, and there would be some loss." The other argument put forward by opponents of online gambling is that legalizing online keno would lead to an increase in problem gambling. Apparently Maine Governor Baldacci has not yet indicated support for the online gambling program.

In Florida the Office of Program Policy & Government Analysis (OPPAGA) will present its final review of the advantages and disadvantages of online gambling regulation to the state Senate Regulated Industries Committee on January 19. This study was commissioned by Florida's need to close budgetary gaps. Ultimately there will be three options before Florida's law makers. One option would be to maintain the status quo and leave the situation legally vague, as is the case at the federal level. But this would not help the financial cause of the state. The second option would be to explicitly prevent online gambling. This would lead to difficult and expensive enforcement and could alienate the section of voters who are in favor of online gambling. The third option is to legalize and regulate online gambling. This would lead to much needed generation of additional tax revenues. The actual decision would depend on the numbers thrown up by the OPPAGA presentation.

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