 | EXECUTIVE OFFICE OF THE PRESIDENT
OFFICE OF MANAGEMENT AND BUDGET
WASHINGTON, D.C. 20503
| STATEMENT OF ADMINISTRATION POLICY
(THIS STATEMENT HAS BEEN COORDINATED BY OMB
WITH THE CONCERNED AGENCIES.)
July 17, 2000
(House)
H.R. 3125 - Internet Gambling Prohibition Act of 2000
(Goodlatte (R) Virginia and 34 cosponsors)
The Administration strongly opposes H.R. 3125, which appears to be designed
to protect certain forms of Internet gambling that currently are illegal,
while potentially opening the floodgates for other forms of illegal
gambling. The Administration is especially troubled by the exemptions
included in the bill for pari-mutuel wagering on activities such as horse
races, dog races, and jai alai. These exemptions could have the effect of
allowing individuals to bet on dog and horse racing from their homes,
giving children and other vulnerable populations unsupervised, unlimited
access to such gambling activities. There is no policy justification for
such exemptions.
The version of the bill that the Administration understands will be offered
on the floor of the House, apparently intended to resolve concerns over the
exemptions, may be more problematic than the current version of the bill.
The new version of the bill eliminates the requirements that wagers on
horse racing, dog racing and jai alai be "initiated from a State in which
[such] betting or wagering . . . is lawful and received in a State in which
such betting is lawful." The bill as expected to be offered can be read so
that these types of pari-mutuel wagering would only need to be regulated in
the State in which the wager is received, allowing a business to be
licensed and operated in one State but take wagers from people in any other
State, regardless of whether the State in which the bettor is located has
authorized such activity. The bill, therefore, would give regulatory and
taxing authority to the State in which the bet is received and take all
regulatory and taxing authority away from the State in which the bet is
initiated.
The Administration is also concerned that H.R. 3125 is not
technology-neutral and applies only to Internet gambling. Legislation that
is tied to a particular technology may quickly become obsolete and require
further amendment. The Administration believes that legislation addressing
conduct over the Internet should treat physical activity and cyberactivity
in the same way. This objective can be most efficiently accomplished by
amending existing gambling laws, as opposed to creating a new
technology-specific statutory scheme. The Administration continues to urge
Congress to address Internet gambling issues by amending the existing
gambling laws, rather than creating new laws that specifically govern the
Internet.
The Administration is also concerned that this bill does not require that
the pari-mutuel industry adopt programs to protect pathological and problem
gamblers such as the self-exclusion programs that have been adopted by
casinos. Finally, the Administration is troubled that this bill could
interfere with the regulatory scheme set forth in the Indian Gaming
Regulatory Act (IGRA). The Administration believes that any Internet
gambling legislation should make it clear that it is not intended to repeal
or amend the rights or privileges secured by the tribes under IGRA.
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