Democratic Governor’s Association Voices Opposition of Graham Bill

March 25, 2014
Democratic Governor’s Association Voices Opposition of Graham Bill

On Monday, Texas Governor Rick Perry sent the House and Senate Judiciary Committees a letter asking for a reversal of the DOJ’s opinion on the Wire Act. Today, the Democratic Governor’s Association sent their own letter in opposition of the upcoming bill seeking to ban online gambling.

Earlier today, a copy of a letter from the Democratic Governor’s Association was sent to the House and Senate Judiciary Committees expressing their “strong opposition” to the Internet Gambling Control Act of 2014. Vermont Governor Peter Shumlin is the Chair of the Democratic Governor’s Association and Gov John Hickenlooper of Colorado serves as Vice-Chair. Eleven governors were listed on the letter, including Gov. Andrew Cuomo of New York and Gov. Jerry Brown of California.

The Internet Gambling Act of 2014 that is rumored to be filed this week by South Carolina Republican Senator Lindsey Graham and supported by Utah Representative Jason Chaffetz.

The theme of the letter from the onset was the protection of state rights. They stress that while that while some states do not regulate gaming, other have become dependent on gaming revenue. According to the letter, “gaming and lotteries are critical to producing the revenue needed to fund important state and local governmental services, such as public education.”

The letter went on to claim that a ban on internet gambling and internet lottery sales would have the “effect of prohibiting the operation of traditional lottery draw games, including Mega Millions and Powerball, currently offered in forty-four states and the District of Columbia, Puerto Rico, and the U.S. Virgin Islands.”

Their claim is centered around the Wire Act. Should the DOJ’s memo against the Wire Act be reversed, then it would be illegal to use the internet for the transmission of bets and wagers. “Since the internet is the means by which lottery systems transmit bets and wagers, this would prohibit the continuation of lottery operations in 47 U.S. jurisdictions,” according to the letter.

Furthermore, the letter claims that the Graham Bill would result in a loss of close to $20 Billion by states in lottery revenue. They further claim that the “states rely on this
revenue to support critical programs for education, senior care, veterans’ services, environmental protection, responsible gaming treatment programs, and other good causes. This Bill would financially crush state funded government services, and the estimate does not even include the loss of actual and future revenues derived from legal and regulated internet gaming and lottery.”

Lastly, they point out that the bill lacks a grandfather clause for already existing legalized online gaming, including that in Nevada, Delaware and New Jersey. They close stating that the Bill will have a “severe and disastrous impact on state governments and in light of these potential effects, the Bill is unworkable and it must be defeated.”

Unlike yesterday’s letter from Gov. Perry, this letter explains in plain English the impact that a blanket ban on online gambling would have on states. It presented hard numbers to members of Congress as opposed to outdated information and moral posturing.

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