Is Iowa the Next Big Online Poker Paradise?

  -   January 19th, 2012   
Posted in: Articles, Industry News

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Corn Fields and Chip Stacks . . .

As reported recently in the Des Moines Register, Iowa is the keystone of a multi-state deal to bring regulated and fully legal online poker to a big chunk of the American population. The possibility of legal poker in Iowa is not exactly news. But it’s still surprising to hear about the state most famous for its corn crop becoming a key player in the push for regulated online poker across America.

Several bills are being drafted by Iowa state legislators that will push for the legalization and regulation of Internet poker in Iowa. Iowa legislators that asked not to be identified told the Register that they expect a vote on this issue in the current legislative session, though no specific timetable exists yet.

In late December, after the DoJ announced their new opinion on the Wire Act, the state legislature asked the Iowa Racing and Gaming Commission to put together a report on the benefits and risks of the state building a system to regulate Internet poker within the state borders. That information is now out, and the same commission is looking into the possibilities for multi-state poker between Iowa and neighboring Midwestern states.

Benefits for Iowa

The report on single-state legalization, in Iowa only, came up with an estimate of the amount of cash the state could pull in offering online poker: between $13 and $60 million annually from the game of poker alone. Earnings on the high end of that estimate, especially when combined with earnings from other online games, like online slot machines, could help put a big dent in the state of Iowa’s $9 billion budget shortfall.

Iowa is considering a state tax rate of 22 percent for their new online poker gaming plans, identical to the state’s traditional casino taxes. It’s possible that this rate would drop if other states were involved, thanks to lower land-based casino taxes in neighboring states. Still, estimates of potential income from the state of Iowa’s regulated online gaming program, including estimates of receipts from online lottery, slot, bingo, and casino gaming as well as poker play, have topped $100 million in some studies.

When you take a look into the reasons for Iowa’s new interest in regulating online poker and casino gaming, it’s the same old story. A state budget disaster, the loss of gaming revenue to Iowans playing casino games online without state regulation, and the inevitability of legal and regulated online poker have come together to force the issue at the state legislature. Could Iowa be a model for the rest of the country’s rush to regulate online gambling?

Iowa is a great model for other states because it is seen as a conservative and even an “old-fashioned” state. If California were the first state to adopt online poker regulations, most Americans would shrug it off as more weird California politics. But Iowa is a state not known for embracing hot-button legislation or stirring the pot politically. If Iowa is considering regulating online poker, many similar states with conservative politics may see an easy “in,” and push for their own state gaming boards to research the issue.

And that’s good news for Americans who want to play legal online poker. More states looking into the legalities of regulating online poker means more interest in our favorite online casino game.

Tags: Des Moines Register, Wire Act

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