Casinos say they can help with California budget crisis

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Legalizing Internet poker could generate $1 billion during the next decade for the cash-starved state treasury, according to a group of California casinos itching to start dealing cards online.

The proposal, which has been put into legislation pending in the California Senate, is timely because the state is currently facing a $25-billion budget shortfall, according to the California Online Poker Assn., which includes the Commerce Casino, Hawaiian Gardens Casino, Hollywood Park Casino and Indian tribes that operate card rooms including the Morongo Band of Mission Indians.

‘This could be part of a solution to California’s budget woes,’ said Ryan Hightower, a spokesman for the association, which is sponsoring SB 40, a bill by Sen. Lou Correa (D-Santa Ana).

The group commissioned an economic study from former state finance director Timothy L. Gage, who concluded that with a 10% operator fee on gross gambling receipts, the state would initially earn about $82 million each year, but the revenue would exceed $100 million annually after five years.

Opponents say Internet poker is not a budget solution. They note that some Indian tribes have threatened to withhold tens of millions of dollars in slot-machine revenue from the state if lawmakers approve what those tribes see as competition to their brick-and-mortar casinos.

Fred Jones of the California Coalition Against Gambling Expansion also said the state budget could be hurt if more families end up in bankruptcy or foreclosure because of the ease of Internet gambling.

‘No society has ever, nor ever will, gamble itself into prosperity,’ he said.

-- Patrick McGreevy