Massachusetts

Citing what he describes as “draconian federal limitations on the ability of states to control online gaming within their borders,” the Massachusetts Treasurer and Receiver-General, Steven Grossman, has written a letter of protest against the draft language of the proposed Reid/Kyl federal bill.

Grossman found several reasons to “object in the strongest possible terms” in his communication to Senators Harry Reid (D-NV) and Jon Kyl (R-AZ), co-authors of the not-yet-introduced Internet Gambling Prohibition, Poker Consumer Protection, and Strengthening UIGEA Act of 2012.

In his letter, Grossman notes that “gaming historically has been subject to state regulation,” while also noting the December 2011 reinterpretation of the 1961 Wire Act by US Attorney General Eric Holder specifically extended that principle to online sales.

Grossman joins the National Governors Association in speaking out against Reid/Kyl well before its official introduction. An NGA letter co-authored by Govs. Steven Beshear of Kentucky and Tom Corbett of Pennsylvania was sent to Reid and other Congressional leaders last week.

The only state governor to support Reid/Kyl to date is Nevada’s Brian Sandoval, whose state would receive special protection under the bill and could be used as a service hub in the event Reid/Kyl is enacted and encountered implementation delays.

Writing on behalf of his state’s Lottery Commission, Grossman also noted that Massachusetts lottery officials “believe this unwarranted and unjustified usurpation of authority will be harmful to the interests of the people of Massachusetts.”

In addition to questioning Reid/Kyl’s sole carveout for online poker, Grossman also protested the favoritism shown in the bill to Nevada corporate interests.

Wrote Grossman in noting the unprecedented nature of the bill’s limitations against other forms of online gambling, “we can only assume that the Act is a blatant, unwarranted and inappropriate attempt to secure first-mover advantage in the online gaming space for Nevada interests.”

Grossman concluded his communication by calling on Reid and Kyl to withdraw the bill from consideration, terming it a “grievous misuse of federal legislative authority.”