- The Washington Times - Wednesday, June 29, 2011

The D.C. Lottery’s plan to introduce unprecedented online gambling in the District is legal as long as play occurs within city borders, the District’s top lawyer said Wednesday.

Attorney General Irvin B. Nathan said the measure complies with federal laws and may proceed toward its September launch date with “continual and close monitoring.”

Nevertheless, there are widespread concerns about how the program, known as I-Gaming, passed the D.C. Council and how it will be implemented in coming months.

Witnesses before the council’s Committee on Finance and Revenue on Wednesday said they were worried the program was being rolled out too quickly.

More time is needed, they said, to look at network security, the wisdom of wagering dollars with the click of a mouse and the placement of gaming “hot spots” in the community.

Committee Chairman Jack Evans, Ward 2 Democrat, called the hearing to publicly vet concerns after the law passed within a supplemental budget bill in December without any public hearings.

With six games in the pipeline, the District would be the first jurisdiction in the United States to offer Internet-based gambling.

“I want to make sure if we go first, we’re going to get this right,” Mr. Evans said.

Council member Michael A. Brown, at-large independent, introduced the law and frequently defended it during Wednesday’s hearing. He said his council colleagues were fully aware of the proposal before they voted it into law.

The proposal is a win-win that regulates an online hobby people engage in anyway, while generating revenue for the District, he said.

Buddy Roogow, executive director of the D.C. Lottery, testified his office has installed safeguards ahead of the release of two demonstration games in late July, Blackjack and Victory at Sea, and four more games in August. Actual betting begins on or about Sept. 8.

Players can only deposit $250 per week, must use debit cards and not credit cards, and can sign up for self-exclusions, or agreements that bar people with gambling problems from acting on their impulses.

Earlier in the day, D.C. Mayor Vincent C. Gray said in response to questions at his weekly news briefing that he wanted a better understanding of how I-Gaming would be regulated before making a decision on whether he supports the practice. Of special interest was how the D.C. Lottery would “ensure people being involved in this type of gambling are in the jurisdiction,” Mr. Gray said.

The lottery must verify the age and Internet Protocol (IP) address of every player through a secure log-in, Mr. Roogow said at the council hearing.

Mr. Evans was concerned that Advisory Neighborhood Commission members and other members of the public have not had adequate notice of the lottery’s plans and the chance to object to “hot spots” in their communities.

The hot spots, targeted at visitors to the city, would be rooms in hotels or other establishments that offer a wireless Internet, or Wi-Fi, signal for I-Gaming under a lottery-approved IP address, according to the lottery’s Mr. Roogow.

Critics also questioned how much money would be generated from the program, based on the lack of precedent.

D.C. Chief Financial Officer Natwar M. Gandhi said he is confident in his “conservative” estimate of $13 million over a four-year period. Amid some skepticism of the projection, he also said politics was not a part of the review, which he said he conducted as he would for any other D.C. law.

“As far as we are concerned, the council did pass this particular act. We are doing it because it’s the law now,” Mr. Gandhi said.

Marie Drissel, who appeared on behalf of a group that calls itself Citizens Against D.C. Government Operated Online and Casino Gambling, warned about using the “fairy-tale numbers.” Some of the receipts should go toward gambling-addiction services or other priorities in the District, other witnesses said.

Mr. Evans said that barring emergency legislation to suspend I-Gaming, his main concern is that the lottery has adequate plans in place and gives proper notice to communities affected by the implementation.

He and other council members received assurances that hot spots would not be placed in public spaces, such as libraries, schools and recreation centers.

“Nothing is a done deal,” Mr. Evans said. “Any law that is passed can be un-passed.”

Mr. Evans also established that the lottery has the power to push back its start date, if it sees fit.

“There is no magic to Sept. 8,” Mr. Roogow said after the hearing.

Despite testimony that middle- to upper-income persons tend to play online gambling, witnesses also suggested poor residents will be adversely affected by gambling.

Patrick Thibodeau, of the citizens’ group, said residents will be using discretionary dollars that could be spent at city shops and restaurants.

Mr. Evans noted that online gambling is simpler than a trip to the casino, making it easy to separate people from their cash.

“Thirteen-thousand dollars is a lot of money to a lot of people,” Mr. Evans said, referring to the maximum amount of money that can be lost in a year. “Frankly, this government doesn’t need the money that badly, and we shouldn’t take it from people who don’t have it. And that worries me. That’s the No. 1 thing about gambling.”