Internet gambling ban hopes still slim

Benjamin Grove

Wednesday, June 19, 2002 | 11:40 a.m.

WASHINGTON -- The House Judiciary Committee approved an Internet gambling ban on an 18-12 vote Tuesday after wrestling with the details both behind-the-scenes and in the committee room in recent weeks.

The bill's chances of becoming law this year may be slim, however.

Aides for Nevada's two House members said it is unlikely Republican leaders will press for a full House vote, given Congress' busy schedule the remainder of this year. And the Senate has not acted on the legislation.

The final version of the bill stripped out an exemption that would have allowed casinos to operate their own Internet gambling websites under certain conditions, including state approval. Several Nevada gaming companies, such as MGM MIRAGE, Park Place Entertainment Corp. and Station Casinos Inc., are interested in launching cyber casinos.

The exemption, strongly supported by the gaming lobby led by the American Gaming Association, would essentially help preserve a state's right to regulate gambling within its borders.

Now the AGA is likely to withdraw its support for the bill because of the deletion of the exemption.

Reps. Shelley Berkley, D-Nev., and Jim Gibbons, R-Nev., also are likely to withdraw support. The bill as approved Tuesday "raised serious concerns" for Gibbons, spokeswoman Amy Spanbauer said.

Gibbons and AGA President Frank Fahrenkopf were scheduled to meet privately today to discuss the bill.

MGM MIRAGE spokesman Alan Feldman called the committee outcome a "highly backward way of thinking."

The bill is trying to make a moral statement, while ignoring the opportunity to offer consumer protections for gamblers and tap into the hundreds of millions of dollars that are largely going to illegitimate businesses, Feldman said.

"All that it's going to do is maintain this black market of Internet gambling that exists in America," Feldman said.

Rep. Bob Goodlatte, R-Va., has been the primary force behind the push in the House to ban Internet gambling, working for several years to build support. As he sought to craft legislation, he made a number of compromises to win the support of various lawmakers, and the gaming industry.

In the end, however, Goodlatte's compromises were stripped out of the bill when the committee approved an amendment from Rep. Chris Cannon, R-Utah, that made the legislation more of an outright ban on all forms of Internet gambling. Cannon's amendment removed exemptions for casinos and state lotteries, for example.

Still, Goodlatte voted for the bill, sending it to an uncertain fate on the House floor.

"Gambling on the Internet has exploded into a lucrative business that sucks billions of dollars out of the U.S. economy each year and costs tens of thousands of jobs," Goodlatte said. "There are over 2,000 illegal, off-shore gambling websites, which are unlicensed, untaxed, and unregulated. Illegal gambling sites evade existing anti-gambling laws by operating off-shore, providing a nearly undetectable harbor for criminal enterprises."

Sun gaming writer Liz Benston contributed to this report.