All bets off: Online poker bill dealt possible death blow

By Karoun Demirjian

Friday, Dec. 17, 2010 | 2 a.m.

A faltered deal to fund the federal government is also likely the end of the line for a bid to legalize online poker.

Late Thursday, Senate Majority Leader Harry Reid pulled the $1.1 trillion omnibus federal spending measure from consideration, effectively rendering more than $2.2 billion in earmarks ($250 million for Nevada), and all amendments that might have been attached to the bill — including, potentially, the legalization of online poker — dead, likely for the remainder of this Congress.

Republicans called it a victory in the fight against runaway spending.

“This may be a seminal moment in the recent history of the United States Senate,” said Arizona Republican Sen. John McCain, a longtime crusader against earmark spending. “For the first time since I’ve been here, we stood up and said ‘stop, enough.’ ”

Reid responded by taking time Thursday to decry and blame Republicans for forcing his hand through what he called boldfaced “hypocrisy.”

“While publicly posturing for months against congressionally directed spending, many of them worked in private to secure funding for priorities in their states,” Reid said. “And when they were exposed for trying to have it both ways, they pressured their colleagues who had previously supported this critical bill to pull their support at the last minute. Make no mistake: People will lose their jobs because of what my Republican colleagues did tonight.”

But earmark debates aside, in Nevada the failure of this budget bill is a crushing blow to the state’s biggest industry.

The gaming industry has been pushing Reid to bring a bill legalizing online poker to the Senate floor in the waning weeks of the current Congress. As other options fell away, the omnibus bill emerged as the last, best chance to have it considered.

The measure, penned by Reid, would remove poker alone from the restrictions Congress adopted in 2006 in the Unlawful Internet Gambling Enforcement Act, which made it illegal to process financial transactions for gaming online in the United States.

It also steps up policing, security, and fraud-protection measures, and lays out a licensing system under which states with experience regulating the gaming industry would get first crack at what’s now, as just a black market, a $25 billion industry serving about 15 million gamers nationwide.

Although the measure is precious cargo for Nevada, and especially Las Vegas’ economy, the state’s lawmakers haven’t been able to find an engine to move it forward — nor does it have the widespread support necessary to move under its own steam.

Gaming lobbyists had hoped to push the bill through Congress under the tax-cut extension bill Congress passed this week. (The House voted late Thursday to approve the Senate’s version of the bill and send it to President Barack Obama for his signature.)

But Senate Republicans put the kibosh on that notion last week, firmly stating there would be “zero chance” of the gaming measure appearing on the tax-cut bill.

And in the Senate, it didn’t. Although the majority leader is normally able to wield enough influence to control process and procedure, the tax compromise emerged as a deal between the White House and Republicans. The final deal was enough of a delicate balance that lawmakers were loath to let anything jeopardize that equilibrium.

Technically speaking, anything could still happen before Congress ends on Jan. 5, pragmatically speaking, that left lawmakers only one option to carry the poker bill — and it’s the one that just fell off the table.

“At this point, the only vehicle I see is the omnibus,” Nevada Sen. John Ensign said Monday. Reid staffers, when asked about the potential for online poker legalization and other changes midday Thursday, also seemed to leave the door of the omnibus open to a poker attempt: “We’d like to have amendments” on the bill, a spokesman said.

It’s not yet clear what Reid plans to substitute as a backup measure now that the funding bill has been pulled. He could put forward a continuing resolution that takes the government through the end of the year, or a bill that will only take Congress through a few months or even a few days. He could even choose to allow amendments — a potential last gasp of a chance for the poker bill to come to the floor.

But whatever he decides, the clock is ticking, and he can’t do it without Republican support.

Congress has to pass a funding measure by Saturday night at midnight or the lights go off, as they did in 1995, when Newt Gingrich’s House hit an impasse with the White House over President Bill Clinton’s budget.

By pulling the bill, Reid hasn’t entirely closed and barred the door to poker; he could, conceivably, attempt to bring up the omnibus legislation again before noon Jan. 5, allowing for amendments, and tie in the poker bill that way.

But with Republicans united against the 1,924-page spending bill, Reid can only move a measure where he can reasonably expect to get votes; and that’s not the bill he’s got in his hands.

Republicans are fairly united against legalizing poker — a factor that lobbyists are painfully aware of, and why they have been pushing Reid to bring up the bill even though they were not sure of having the votes.

A spokesman for Reid said Thursday that he “will continue working to find a way to get it done, whether it is this year or next.”

But with remaining bills that include only tenuous, tough-slog measures such as a repeal of the military’s “don’t ask, don’t tell” policy on gays serving in the military, and the DREAM Act, which gives young, undocumented immigrants who are military enlistees or college students a shot at citizenship — it would appear that the chips are down, and he’s holding a bad hand.