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Iowa should keep its options open and develop plans to "protect its borders" while Internet gambling legislation is being debated in Congress, Iowa Lottery Chief Executive Officer Terry Rich said Tuesday.
Rich briefed the Iowa Lottery Board on a bill authored by U.S. Rep. Barney Frank, a Massachusetts Democrat, that would establish a regulatory framework to permit licensed Internet gambling in the United States. Other Internet-gambling bills have also been introduced in Congress.
"Based upon what we are seeing, I think that the federal government may pass something. Obviously, our job as employees of the state...is to make sure that our elected officials know that if it does pass, what impact it might have for the state," Rich said.
The legislation could include provisions authorizing the federal government to regulate and tax Internet gambling in Iowa if the state's elected officials don't take action within a specified time frame, Rich said. He is urging state officials to protect their right to either reject or approve Internet gambling, and to impose taxes.
"The decision may be to do something, do nothing; but to at least have control so that if you do something in the state of Iowa that the state legislature and the governor decides what it should be," Rich said.
The Iowa Lottery has remained neutral on Internet gambling, but Rich said he has been briefing Gov. Chet Culver's staff and the Iowa Legislature's Government Oversight Committee about the issue.
Culver's aides didn't immediately respond to a request for comment on Tuesday.
The 3rd U.S. Circuit Court of Appeals earlier this month upheld a federal ban on Internet gambling, although some legal experts said the ruling appeared to open the possibility for states to have more say on the issue. The decision upheld the Unlawful Internet Gambling Enforcement Act of 2006, which banned credit card firms from processing payments for online wagering.
The Iowa Racing and Gaming Commission, which regulates the state's 17 commercial casinos and three racetracks, hasn't taken a stance on the pending federal legislation, said Jack Ketterer, the commission's administrator. For the 12 months ending June 30, the casinos ranked in $1.4 billion in gross revenue from about 23 million admissions.
Ketterer noted that existing federal law provides an exemption which allows wagering via the Internet and telephone on horse races when such gambling is permitted in both states. But the issue of Internet gambling on Iowa horse races has never been pushed legally in Iowa, and Ketterer said the Iowa commission would probably say it is not legal.
