West Virginia Seventh State Seeking To Legalise Online Gambling

Declining revenues from bricks-and-mortar casinos have led West Virginia to join the growing number of states showing interest in legalising online gambling. With the introduction of the first bill on the issue (HB 3067) earlier this month.

The proposed legislation, sponsored by Delegate Shawn Fluharty with co-sponsors Sean Hornbuckle, Mike Pushkin, Joseph Canestraro and Mike Bates seeks to legalise and regulate online gambling in West Virginia.

The background to the debate in West Virginia

Online gaming has been on the radar in West Virginia since 2014. Although the focus then was more on selling lottery tickets online than gambling.

Under the new legislation, licensed gaming facilities and race tracks would be eligible to apply for internet gambling licenses at the cost of $50,00 and would be subject to a 14% tax on their gross revenue. It is an attractive proposition as racing, and land-based casino revenues have dropped by as much 10% in the last three years.

Key features of the bill

While the bill proposes that the West Virginia Lottery Commission be charged with setting out specific regulations. It does include some baseline regulatory standards to which operators must adhere:

  • Ensure that participants are at least 21
  • Verify that players are residing within the state of West Virginia or another permissible jurisdiction
  • Minimise problem gambling by putting responsible gaming protocols in place
  • Provide fair and honest games
  • Institute policies to deter and detect cheating and the use of software including bots
  • Separate player funds from operating funds

Penalties and interstate agreements

The bill proposes criminal penalties for unauthorised Internet gambling activity such as unlicensed gaming sites operating within the state. Depending on frequency, offences would carry penalties ranging from a misdemeanour charge and a fine of up to $150,00 to a felony charge. A fine of up to $300,000 and a maximum prison sentence of three years.

The bill also makes provision for interstate agreements allowing players to participate in interactive games. With people outside the state in jurisdictions where such gaming is legal.

The future of the bill

It would seem that the chances of this legislation passing in West Virginia are better than in some other states. It is, after all, a gaming state. Fluharty’s bill is of course just the first attempt at legislation there. In reports by Morgan Stanley that it would not likely go through until 2020 as one of a list of 20 states looking to legalise online gambling.

To date, the only states in America to have legalised online gambling are New Jersey, Nevada, and Delaware. Other states currently debating online gambling bills are Massachusetts, Pennsylvania, New York, New Hampshire, Michigan, and of course California where legislation has been on the agenda since 2008.

Of all these the first three are in consideration to be the most likely candidates for legislative success in 2017. Pennsylvania being the one to go first and nudge the other states to get on board.