Legislature(2005 - 2006)BELTZ 211
04/19/2005 01:30 PM Senate LABOR & COMMERCE
| Audio | Topic |
|---|---|
| Start | |
| Confirmation Hearing(s) | |
| Richard Heieren, Fairbanks | |
| Gary Atwood, Fairbanks | |
| Colleen Scanlon, Ketchikan | |
| HB81 | |
| SB169 | |
| SB168 | |
| SB165 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | SB 168 | TELECONFERENCED | |
| *+ | SB 169 | TELECONFERENCED | |
| *+ | SB 165 | TELECONFERENCED | |
| = | HB 81 | ||
SB 165-CARD ROOMS & OPERATIONS
CHAIR BUNDE announced SB 165 to be up for consideration.
BRIAN MCKINSTER, staff to Senator Cowdery, explained that SB 165
allows card rooms to exist in a controlled public environment,
but only non-bank games can be played such as poker and rummy.
He said there is a growing popularity for these games in the
country and the state and crime goes with hand in hand with
underground games; but in a public legal environment the games
will be regulated and followed closely by state officials. The
state would charge a $10,000 yearly fee per table with a $25,000
application fee. The yearly fee would not be prorated.
This bill addresses who can and who cannot hold a license and
limits the number of licenses to 1 per 30,000 in population.
These games are allowed at home so this is not necessarily and
expansion of gaming, but "We're just saying in a controlled
limited environment, you can play in a public venue that is
limited by the state for revenue and for criminal activity."
2:07:12 PM
CHAIR BUNDE said it is legal to gamble with cards for money in
Alaska as long as the house doesn't take a rake or some of the
money for operating costs.
MR. MCKINSTER agreed, but added that the clarification needs to
be made that there is a difference between a rake and the house
actually having a stake in the game.
You're not playing odds against the house like you
would at blackjack. The odds are even for every other
table and they're physically playing against each
other instead of the house. Basically, it's just a
rental fee for the table or otherwise known as rake.
2:08:08 PM
CHAIR BUNDE said the significant change this bill would make is
it would allow someone who has organized the game to charge for
table rental. He expressed a conflict in that he plays poker and
asked if this bill would allow tournaments.
MR. MCKINSTER replied that it doesn't address that except for
charity. Senator Cowdery thought it best to leave that to the
department to develop in regulations.
2:10:54 PM
SENATOR COWDERY noticed that the committee had an advertisement
for a world poker tour with players paying $15,000 for a chance
to win $1.7 million.
MR. MCKINSTER explained that the maximum dollar amounts would be
left up to the Department of Revenue.
2:11:59 PM
CHAIR BUNDE said the bill focuses on poker and asked if other
games, like cribbage, are covered.
MR. MCKINSTER said originally the sponsor didn't intend to name
the games in the bill, but wanted to leave that to the
department. However, some people wanted reassurances about what
games would be allowed under this statute and they are now
listed as poker, pan, rummy and cribbage.
2:13:37 PM
CHAIR BUNDE asked how wagers are addressed.
MR. MCKINSTER replied the department could decide how much
wagers would be, but he envisioned $1 - $4.
2:14:14 PM
SENATOR DAVIS was concerned about money made by people who own
the gaming rooms.
MR. MCKINSTER said this bill doesn't address that, but a sponsor
substitute could. The department would decide.
SENATOR DAVIS asked how many new jobs would this provide.
MR. MCKINSTER replied that it takes 7.5 people to run a table,
not considering food and beverage services.
CHAIR BUNDE asked what rates are in other areas.
MR. MCKINSTER replied that other areas charge a fairly small
percentage based on the size of the game that is played.
2:16:38 PM
CHAIR BUNDE asked if he thought serving alcohol should be
allowed in card rooms.
MR. MCKINSTER replied that serving alcohol is not addressed in
the bill. However, a couple of people he talked to said they
wouldn't need alcohol to sell this as an establishment and
that's obviously the case now.
He noted that state policy does not allow free alcohol to be
served as an incentive like in a Las Vegas casino, but the
Department of Revenue could decide that, also.
CHAIR BUNDE asked what the fiscal impact to the state is.
BRETT FRIED, Economist, Department of Revenue (DOR), replied
that it is difficult to generate a number. He doesn't know how
many card rooms or tables would end up in the card rooms. He
used the 2000 census for a maximum allowable number and divided
that by 30,000 and came up with 13. He used the maximum number
of card tables per room allowed in Washington state, which is 15
and 6.7 as the average number of gaming employees per table to
derive an estimate of $2.5 million in the first year and $2.1
million in the second year.
2:20:33 PM
PERRY GREEN, Alaskan card player, said the bill is well written
and is very stringent for a card room. "It's a wonderful way of
doing it."
He expressed that there is a lot of interest in this activity
and compared it to golf that has about 2,000 pros that are
playing for $100 million in prize money per year. He said:
Poker has blossomed so much that today the prize money
in tournaments is around $700 million. With Senator
Cowdery's bill we're not talking about this kind of
money. But I'm just saying that that is what's
happening.
He said that gambling happens in Alaskan waters on tour ships.
"So, if you think you're stopping gambling, you're not - by not
voting for this."
CHAIR BUNDE pointed out that cruise ships can gamble only
outside of state waters and asked what rake is standard for the
industry per game.
MR. GREEN replied that California charges for poker rooms get $3
or $4 to host one game and it takes three or four people to run
one table. They each need a dealer, security, janitors, relief,
floor supervisors, cashiers, maintenance, rush people and on-
call people.
CHAIR BUNDE asked how many games are played per hour and how
long a day is.
MR. GREEN answered that card rooms generally take in $90 per
hour per table - gross - and the games can run for any number of
hours. "It depends. Games start and break up and start again."
2:28:02 PM
SENATOR DAVIS noted that Senator Cowdery had pointed out flyers
describing all the money that can be made playing poker and said
those big games are happening here now.
SENATOR COWDERY added that he could find 15 underground games in
Anchorage per night if he wanted to. "It's unregulated and
that's a fact. I think it's a recreational game. Even my wife
has caught on to it."
2:30:22 PM
CHAIR BUNDE said TV gambling is a growing phenomenon. He asked
if on-line gambling is legal in Alaska if it's headquartered
somewhere else.
SENATOR COWDERY responded that he thought on-line games are
offshore.
MR. GREEN said about 90 percent of on-line poker goes to Costa
Rica, Dominican Republic, London, and other tax haven places. He
knew of a $7,200,000 tournament that was out of Aruba.
2:31:24 PM
CHAIR BUNDE asked if convicted felons would be allowed to run
games.
SENATOR COWDERY responded:
Before anybody could get a license, you might hope
that they would have to be cleared of any felony or
any crimes in their past just to try to keep this
above board to be run by individuals or people who are
aboveboard and citizens.... I think anyone who is
going to open one of these establishments should be
pretty up and coming people, not convicted felons.
MR. GREEN added that on-line sites charge $3 per game and that:
I know in games where you're playing for money, they
have no brick and mortar. By brick and mortar, they
don't have a plant or facility. All they have is a
computer line. And I noticed when "Poker Stars" dealt
their one-billionth hand - one-billionth hand - they
gave away $100,000 whether you were playing for five
and ten cents or you were playing for $1,000 or
%10,000.... They are just coining money and good luck
to them.
CHAIR BUNDE said that there were no further questions and closed
the hearing. The committee would wait for the CS. He then
adjourned the meeting at 2:34:13 PM.
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