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DES MOINES, Iowa (Associated Press) — The Iowa Lottery is urging Congress to reject proposals to authorize federal regulation of Internet gambling.
Lottery CEO Terry Rich recently traveled to Washington, D.C. to lobby on the issue with the North American Association of State and Provincial Lotteries. Rich detailed his efforts in a report to members of the Iowa Legislature's Government Oversight Committee, the Des Moines Register reported.
"The lotteries emphasized that the federal government should not infringe on states' rights to implement and to regulate Internet gaming within their own borders. Lottery staff also stressed that individual states are best equipped to respond to their citizens' unique local preferences and decide what, if any, intrastate gaming should occur within their jurisdictions," Rich said in the report.
The Iowa Lottery has no immediate plans to offer Internet gaming, but Rich said he's concerned about an Internet gambling proposal recently circulated by Senate Majority Leader Harry Reid. Rich noted that Illinois and Georgia already sell lottery tickets online and that Delaware has authorized its state lottery to offer online gaming.
Reid said in a statement posted on his U.S. Senate office website that his bill would make it unambiguously illegal to offer online gambling services without a license. Licenses would be available only for Internet poker, and sites offering unlawful online gambling services would have to shut down within 30 days or be blacklisted from the licensing program forever.
Reid's initiative is apparently dead for now in Congress, but it could surface again in the future.
The US Justice Department has maintained that Internet gambling across state borders violates federal law, but many industry experts believe federal law doesn't prohibit such wagering within a state's borders.
The Iowa Senate last session approved a bill to permit intrastate Internet poker, although it died in the House. The bill's supporters contended the legislation would help prevent as much as $30 million a year flowing from Iowa to overseas operators.
Rich sent a letter to Reid, House Speaker John Boehner, R-Ohio, and other congressional leaders in November in which he expressed his concerns about federal Internet gambling legislation circumventing state laws. States would be prohibited from choosing which games to offer on the Internet, and the tax structure would override state tax rates, he complained.
"The Iowa Lottery has raised more than $1.4 billion for vital causes, including economic development, education and support for Iowa veterans and their families. Across the nation, in 2011 alone, lotteries provided $25 billion in net profits to local causes. In short, state lotteries are funding important missions," Rich said in the letter to federal lawmakers.
He added, "Congress should not enact legislation that supersedes state authority and that selects winners and losers."
