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Nevada Losing Ground as U.S. Gambling Center?

August 24, 2009 (CAP Newswire) — The recent proposal by the Morongo Band of Mission Indians in California is just the latest approach that state has taken to fully legalize and regulate online gambling within its borders. Before that (and still going strong), other interest groups within the Golden State have worked to pursue the same goal: Making online poker (and possibly other forms of gambling) a legal possibility for the millions of residents of America’s biggest state (and largest economy).

It’s for this reason that some are speculating that California may soon overcome Nevada as the center of gambling in the U.S. Sure, Las Vegas isn’t going anywhere, and it’s impossible to imagine another U.S. city becoming the hub of land-based casinos that Vegas has become. Still, with revenue for land-based casinos steadily falling, and profits from online gambling sharply rising, it makes sense that the group that fully embraces Internet gambling will gain the competitive advantage, perhaps permanently, in the not-too-distant future.

“California is at the forefront in pursuing in-state Internet gambling,” writes Liz Benston in the Las Vegas Sun. “By preventing online operators elsewhere from tapping California residents, California — struggling under a crippling budget deficit — wouldn’t have to share tax revenue with the feds or other states.

“In 2001 the Nevada Legislature passed a law authorizing the state to explore Internet gambling regulations,” Benston continues, explaining why similar legislation for Nevada-only online gambling would be hard to imagine in that state. “At the time, legislators envisioned gamblers nationwide betting in Web casinos operated by Nevada companies, with the state collecting millions in tax revenue. It would be hard to justify Internet gambling for state residents only, given how much gambling exists, Gaming Control Board Chairman Dennis Neilander said.

“While Nevada stands back, California is moving forward,” she concludes. “ … California — 14 times more populous than Nevada — could become a $2 billion market for online poker sites licensed there … ”

True, California’s regulations would be for its residents only. However, more and more states are destined to adopt this approach, and it's also likely that the federal government will remove the UIGEA regulations in the future. If that's the case, the state that first developed its own framework for online gambling will probably be first to develop a national framework, as well. And as it stands now, it’s looking like that state will be California, which has been by far the most aggressive in pursuing its own online gaming laws.

To read Liz Benston’s complete article in the Las Vegas Sun, please click here.