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2013 Federal Gaming Outlook

Nevada Washington Watch

January 24, 2013

Frank J. Fahrenkopf, Jr.
President and CEO, American Gaming Association

After a year of political campaigning that consumed Washington, D.C.’s – and the public’s – attentions and can best be described as democracy at both its messiest and finest, 2013 will be a time for both Congress and the White House to get down to the business of governing. Here at the American Gaming Association (AGA), we are looking forward to the many things we can accomplish during the coming year as the voice of the commercial gaming industry in Washington and nationwide.

At first glance, the result of last November’s election is a continuation of the status quo, with a Senate controlled by Democrats and a Republican-led House. For many who followed the last Congress, this probably does not inspire much hope for any vast changes in legislative cooperation. However, a closer look reveals more change than one might expect. As a result of the election there are 83 new freshman members of the House and 12 in the Senate.  Additionally, two newly appointed Senators will begin serving out the terms of Sens. Daniel Inouye (D-Hawaii) and Jim DeMint (R-S.C.). Two of those incoming freshmen – Reps. Steven Horsford and Dina Titus – are part of the Nevada delegation, and the AGA looks forward to working with them.

This influx of new legislators gives the AGA a tremendous opportunity to educate a new set of stakeholders and grow our stable of allies. The number of states with operating commercial casinos has grown to 23, expanding the number of members of Congress with gaming in their state or district. These potential new advocates will work in tandem with other members of the gaming caucus to stand up for issues important to our industry.

There are a number of significant national issues that will need to be addressed when the 113th Congress convenes this month. Many of these priorities, such as immigration and tax reform, are ones that our industry, either directly or indirectly, has a stake in, and the AGA plans to make sure that the industry’s voice is heard during these debates.

One issue likely to be on the table is immigration reform. The commercial gaming industry favors comprehensive immigration reform, accounting for both border security and the creation of employment opportunities for the millions of immigrant workers that help our businesses succeed.

Regarding broader tax reform, we continue working to ensure our voice is heard so that our industry and employees are treated fairly with the best opportunities to remain competitive and continue creating good jobs positively benefiting the communities where we do business. Additionally, we remain active in the pursuit for the long-term extension of the Work Opportunity Tax Credit, the Research and Experimentation Tax Credit, and depreciation tax deduction—which will all unquestionably have an immediate and positive impact on our entire industry.

Of course, the gaming issue that has garnered the most attention in Washington during the past two years has been Internet gambling and online poker. Despite the fact that federal legislation to license and regulate online poker failed to be introduced or passed during the most recent lame duck session, the AGA will continue to work with our members, association partners and Congressional allies to get an online poker bill passed during the 113th Congress.

We believe congressional action is necessary. Federal legislation will stop the pending widespread legalization of all types of online gambling and a state-by-state patchwork of regulations that would put gaming patrons at risk and stymie law enforcement efforts against illegal operators. Legislation also is needed to establish federal minimum standards that address consumer protection, prevent underage gambling and other criminal activity, promote responsible gaming, and provide help for those with gambling problems. Congressional action also is needed to give law enforcement entities the tools they need to effectively combat illegal online gambling once and for all.

It will be important for any online poker bill to recognize that there is too much risk in leaving licensing to inexperienced regulators, which is why legislation should place licensing and regulatory authority in the hands of regulators in states like Nevada that have a proven history of effective gaming regulation. This approach will guarantee that every state that decides to allow Internet poker will have regulatory controls that will fully protect their citizens.

A bill drafted last year by Sens. Harry Reid and Jon Kyl effectively addressed many of these issues, but the bill was never introduced. The AGA will work with Sen. Reid, Sen. Dean Heller and other key legislative allies to move this issue forward in the coming Congress.

Whether it is at the state or federal level, there is no doubt Internet gambling is coming to the U.S.  Nevada will lead the way as online poker gets underway there in 2013, and the comprehensive regulatory scheme developed there can serve as a model for other states considering legalization. The eyes of the gaming industry will be on Nevada to see how this new sector develops.

While other federal legislation specific to gaming and casinos is less likely to be at the forefront of this Congress’s legislative agenda, there are several issues that, if addressed, will have a direct impact on our industry. For example, the AGA will continue to support legislation to increase travel and tourism and will to monitor discussions surrounding off-reservation gaming.

In addition to its work on federal issues, the AGA will stand up for the industry across the country on issues like restricting Internet sweepstakes cafes and promoting regulatory reform, while also educating key stakeholders about the real and positive impacts our businesses have on communities.

In the halls of Congress and around Washington, 2013 is going to be a busy year, and the AGA looks forward to working with our friends from Nevada and other gaming states to advocate for those policies that will help the gaming industry grow and flourish.

The AGA encourages all of its stakeholders to engage with us through our social media platforms, which have increased in visibility during the last year. Follow all our latest news and activities—as well as updates from around the industry—via Twitter (@AGAUpdate) and Facebook (www.facebook.com/americangaming).

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