FLASHREPORT

SB 1369: TROJAN HORSE LEGISLATION WOULD BE BAD NEWS FOR ALL CALIFORNIANS

Doug Pringle, President of Disabled Sports USA Far West

SB 1369, introduced by Senator Gil Cedillo (D) of Los Angeles, is a gut and amend bill headed for the Governor’s desk that would devastate hundreds of local charities while allowing California’s tribal casinos to expand their gambling operations onto the internet, essentially amounting to the greatest expansion of legal gambling in California’s history. This competition would in turn severely weaken the viability of the California Lottery as a potential revenue source to protect education funding and to keep future budgets balanced. 

This legislation outlaws the electronic charity bingo machines that hundreds of small charities throughout the state rely on for funding.  In its place, it creates something called “Remote Caller Bingo,” a technology that links simultaneous Bingo games at multiple locations throughout the state.  While organizers of Remote Caller Bingo will be able to offer larger, “life altering” jack pots, the technology will be unavailable to small charities and its practicality and profitability is questionable even for larger charities.

Meanwhile, the spread of Remote Caller Bingo through internet technology triggers a little-known clause buried inside the Indian gaming compact: basically, casinos operating under the compact have the right to use the internet for gambling if that technology is opened up to anyone else in California.

Essentially, if charities can offer Remote Caller Bingo online, then the door is open for gaming tribes to do the same. Because bingo is a game authorized by the lottery, tribes will be able to offer lottery games online.  And what’s more, loopholes in compact language and federal law may give casinos the green light to not only offer Bingo and Lottery games, but to offer other casino games like poker, black jack and slots.  Anything that’s played inside a casino could be played over the Internet with the approval of SB 1369.

According to I. Nelson Rose, a leading authority on gaming law, SB 1369 could “lead to the greatest expansion of legal gambling in history.”

Current online gambling operations are hosted overseas and betting and collecting winnings can be problematic.  But with SB 1369, California would become the first U.S. state to allow fully legalized online gambling!  

Another critical side effect of SB 1369 is that it creates new and attractive competition with the California State Lottery.  If tribes and large organizations can offer large prizes in wide area networked social settings and directly into players’ homes via the internet, the lottery, which is already underperforming, becomes very unattractive as an alternative.

This extra competition renders the California Lottery nearly irrelevant and all but negates any potential it ever had to bolster school funding.  In doing so, SB 1369’s impact also severely devalues the lottery’s attractiveness for any private sector buyer, or for that matter, its usefulness for securitization, both of which have been discussed among strategies for resolving state budget deficits.

Hundreds of local charities are dependent on Governor Schwarzenegger’s veto of SB 1369.  While in recent weeks the state budget stalemate has been on the minds of most Californians, it is equally important to Californians that our elected leaders protect local charities and the people they serve.
_________________________________________________

Doug Pringle is President of Disabled Sports USA Far West which has used charity bingo for 25 years to support its sports rehabilitation and therapeutic recreation programs for people with disabilities. For more information on SB 1398 visit www.savecharitybingo.org.