Thursday June 30, 2011 : District Attorney General has no problem with new bill
The Washington DC measure legalising intrastate online gambling is fully legal, and the DC Lottery’s plan to launch internet gambling within the district can lawfully progress, the District’s Attorney General Irvin B. Nathan told a hearing by the council’s Committee on Finance and Revenue Wednesday.
Nathan said the measure complies with federal laws and may proceed toward its September 8 launch date with “continual and close monitoring.”
The AG was one of several witnesses appearing before the committee, which chairman Jack Evans convened to consider the legality, practicalities and propriety of the legalising measure, which was approved in April after being included in a budget bill by independent councillor Michael A. Brown and escaped objections from Congress within the time period allowed for complaints (see previous InfoPowa reports).
Councillor Evans has also expressed reservations about Brown’s motivation in introducing the bill, and his association with a Washington DC law and lobbying firm.
“We didn’t even know it was in there,” said the finance committee chairman. “This was requested to be put into a supplemental budget back in December, without any hearing, without any notice, without any anything.”
With six games in the pipeline, the District could be the first jurisdiction in the United States to offer Internet-based gambling, and officials of the DC Lotteries are pressing ahead with plans to roll out games and put in place a properly regulated online gambling infrastructure.
“I want to make sure if we go first, we’re going to get this right,” Evans said Wednesday, adding that Advisory Neighborhood Commission members and other members of the public have not had adequate notice of the lottery’s plans and the chance to object to “hot spots” in their communities.
Councillor Brown defended the measure during Wednesday’s hearing, stressing that his council colleagues were fully aware of the proposal before they voted it into law. “Maybe some people didn’t read the budget,” he said.
The proposal is a win-win that regulates an online hobby people engage in anyway, while generating revenue for the District, he said.
Buddy Roogow, executive director of the D.C. Lottery, testified his office has installed safeguards ahead of the release of two demonstration games in late July, and four more games in August. Actual betting begins on or about September 8.
Players can only deposit $250 per week, Roogow said, and they must use debit cards and not credit cards. Punters can sign up for self-exclusions, or agreements that bar people with gambling problems from acting on their impulses.
D.C. Mayor Vincent C. Gray said in response to questions at his weekly news briefing earlier in the day that he wanted a better understanding of how the online gambling initiative would be regulated before making a decision on whether he supports the practice. He said that he was especially interested in how the D.C. Lottery would ensure people involved in this type of gambling are within the boundaries of the District.
Roogow advised the committee that the lottery must verify the age and Internet Protocol (IP) address of every player through a secure log-in.
The hot spots, targeted at visitors to the city, would be rooms in hotels or other establishments that offer a wireless Internet, or Wi-Fi, signal for I-Gaming under a lottery-approved IP address, Roogow added.
Some witnesses questioned the financial benefits to the District, but D.C. Chief Financial Officer Natwar M. Gandhi said he was confident in his “conservative” estimate of $13 million over a four-year period.
Politics was not a part of the review, which he said he conducted as he would for any other D.C. law.
“As far as we are concerned, the council did pass this particular act. We are doing it because it’s the law now,” Gandhi said.
A representative of the activist group Citizens Against D.C. Government Operated Online and Casino Gambling, warned about using “fairy-tale numbers.” Some of the receipts should go toward gambling-addiction services or other priorities in the District, other witnesses said.
Chairman Evans said that his main concern is that the lottery has adequate plans in place and gives proper notice to communities affected by the implementation.
He was assured that the Lottery’s hot spots would not be placed in public spaces, such as libraries, schools and recreation centers.
“Nothing is a done deal,” Evans warned. “Any law that is passed can be un-passed.”
Evans also established that DC Lottery has the power to push back its start date, if it sees fit.
Despite testimony that middle- to upper-income persons tend to dominate the demographic for internet gambling, some witnesses suggested that residents living in poverty could be adversely affected by gambling.
Evans noted that online gambling is more easily accessed than a trip to a land casino, and referred to the maximum amount of $13 000 that any individual player will be allowed to deposit in a year, saying:
“Thirteen-thousand dollars is a lot of money to a lot of people. Frankly, this government doesn’t need the money that badly, and we shouldn’t take it from people who don’t have it. And that worries me. That’s the No. 1 thing about gambling.”
The DC internet gambling platform is being designed by experts from the District’s Greece-based lottery contractor, Intralot. The D.C. Lottery and Charitable Games Control Board will get half of the tax revenue generated.
Speaking for the DC Lottery, Roogow said that cutting-edge responsible gaming measures were included in the plans. People will have to set up an account to play. There will be a weekly deposit limit of $250. Gaming will be shut down between 4 and 10 a.m. The lottery agency plans to monitor players electronically and cut them off if necessary, and those with concerns about their self-control can ban themselves, he noted.
An Intralot official said that payouts in the District would be competitive but that the target market is recreational players, not high-stakes professionals who play many hands at once. Bettors would have to be 19 or older and be physically located within the city’s 61 square mile boundaries.
D.C. officials are planning to use the government-owned DC-Net as the backbone of the system. This connects hundreds of government buildings with miles of fibre optic cable.
Roogow said a “large portion” of the city would have access using DC-Net locations. Hotels, bars and restaurants will be added to the list. Officials said permission for Internet connections at private homes will roll out when they are confident there will be no technological foul-ups.