POSTED: 12:26 p.m. HST, Mar 23, 2011
LAST UPDATED: 4:54 p.m. HST, Mar 23, 2011
Hawaii would host both online and in-person poker games in a state that otherwise bans gambling altogether, according to a bill that cleared its first committees Wednesday.
The legislation allows only Texas Hold 'em and Omaha varieties of poker as a way to boost tourism and the economy. The bill now moves to the House Finance Committee.
The measure exempts poker from state laws banning gambling by defining it as a game of skill rather than chance. Games played against a computer or casino, such as video poker, are prohibited.
Hawaii and Utah are the only two states without any gambling.
Live poker tournaments in Hawaii would attract new visitors, fill hotel rooms and bring national TV exposure, said bill sponsor Rep. Angus McKelvey, D-Olowalu-Kapalua.
Allowing online poker sites to be based in the islands would bring millions in new tax money to a state facing deep budget shortfalls, he said. All Internet poker sites are currently located outside of the country, although they draw large numbers of players from the United States.
"Maybe this is a way to help attract mainland visitors back to Hawaii, plus you get the free promotion of this being televised," said McKelvey, chairman for the Economic Revitalization & Business Committee. "The revenue to the state potentially could be huge."
Gambling opponents said introducing poker to Hawaii would clear the way for the state to eventually legalize casinos, lotteries and slot machines.
"It will be the start of many other forms of legalized gambling in Hawaii," said Tom Kay, an attorney for the Hawaii Coalition Against Legalized Gambling. "Once you get people involved in gambling, some people will get addicted to it, and then you'll start having problems."
Poker supporters also said the measure has problems.
It would charge potential Internet poker sites at least $100 million each to locate their servers in Hawaii, impose a "not feasible" 20 percent tax on wagers, and federal authorities would object to state efforts to regulate interstate gaming, said John Pappas, executive director for the Washington-based Poker Players Alliance.
"The popularity of poker has made hosting live tournaments an attractive opportunity for many locales," said Pappas in written testimony. "But we are dubious about the efforts to 'regulate' Internet poker in the state."
Previous attempts to regulate Internet poker in the United States have fallen short.
Federal legislation that would apply to the entire country is pending, but proposals for in-state online poker have failed. Earlier this month, New Jersey Gov. Chris Christie vetoed a bill that would have made the state the first in the nation to legalize Internet gambling.
The argument that poker is a game of skill didn't convince several legislators that it isn't still gambling.
"No matter how you describe it, it's the first step on the way toward legalizing gambling in Hawaii," said Rep. Cynthia Thielen, R-Kaneohe-Kailua. "It's maybe a small step, but there's no way it's not that first step."
The bill passed the Economic Revitalization & Business Committee on a 7-1 vote, and the House Judiciary Committee approved it 9-3.
The measure originally was designed to create a tax holiday for buying school supplies, but McKelvey rewrote it to authorize poker games to raise money for the state because it can't afford a tax holiday. If the bill passed, the tax holiday could be reconsidered, he said.