Last week, we reported that AB 2863 was scheduled for an Assembly GO Committee hearing this week.
We felt that recent changes to the bill could help it pass out of committee despite the charges currently facing Amaya CEO David Baazov.
Our prediction was almost prophetic as the bill passed out of committee unanimously on Monday and moves to a potential Assembly floor vote.
Horse Racing Industry Voiced Support of Bill
Wednesday's committee hearing confirmed that one of two major roadblocks to iPoker regulation has finally been cleared.
The horse racing industry voiced its support of AB 2863, support that Assembly Adam Gray achieved by offering a $60 million subsidy to the industry in exchange for an agreement to not offer iPoker.
Up until this year, the horse racing industry had insisted that it wanted the right to offer online poker alongside state-run card rooms and tribal casinos.
Even Governor Jerry Brown insisted that industry concerns be met. He promised to veto any bill that failed to do so. With the subsidy, the industry gives up its rights to offer online poker and one cannot blame them.
Odds are that racetracks couldn't generate anywhere near the $60 million that will come their way via subsidies. This is money in the bank for racetracks.
Certain Tribes Want Bad Actor Matter Resolved Before Supporting the Bills
One big issue remains: that of bad actors. The amendment to the bill calls for policy to be developed to address bad actors, but lawmakers have yet to reveal the path that policy will take.
The Pechanga and Agua Caliente tribe are the two largest opponents to the bill with the Pechanga among the most politically powerful of the tribes in the state.
Pechanga has yet to take a stance on the bill while the Agua Caliente has said they are opposed unless amended.
Assemblyman Gray has stated that he is working with tribes towards policy on bad actors and will develop some type of policy before a floor vote is held.
What's Next for AB 2863?
Officially, AB 2863 moves forward to the Assembly floor for a potential vote. However, that vote will probably not happen until the bad actor clause or provision is fully defined the bill.
For now, that means more negotiation between tribes and lawmakers, a process that is ongoing but one that Gray says has produced significant results thus far. Of course, there is still the matter of insider trading charges against Amaya CEO David Baazov.
Will lawmakers be able to move forward before those charges are resolved? We highly doubt it. The speed at which that matter is resolved will likely be the factor that determines whether AB 2863 will go to a vote in 2016 or if lawmakers will have to try again next year.