Groups in 13 states want US to block Internet bets

Wednesday, June 6, 2012 | 6:19 p.m. CDT

ATLANTIC CITY, N.J. — Family-centric groups in 13 states are calling on Congress to block states across the nation from legalizing Internet gambling, saying the societal costs will far outweigh the benefit to tax coffers.

They want Congress to strengthen the Unlawful Internet Gambling Enforcement Act of 2006 "to ensure its clear intent that the Internet not become a giant online casino."

The groups are from Wisconsin, Kentucky, Louisiana, North and South Carolina, Ohio, Pennsylvania, Missouri, Massachusetts, Minnesota, Hawaii, Georgia and Tennessee.

The Department of Justice ruled in December that in-state online bets not involving sports teams do not violate federal law. That has touched off a race by cash-strapped state governments to try to legalize Internet gambling.

Several national family groups expressed similar concerns last month.

"The bottom line is we are The Family Foundation, and expansion of gambling through casinos or online is targeting one group only: moms and dads," said Kent Ostrander, founder of The Family Foundation of Kentucky. "It's an effort to separate a family from its assets. The family is the building block of any society, and yet it is the most vulnerable institution in that society."

Ostrander said there is a push in Kentucky, as in many other states, to add slot machines or casino-style gambling to racetracks in order to increase the tracks' viability.

He said the added tax revenue to state governments will be more than offset by the societal costs of expanded gambling, particularly if it is made as easy as logging on to a computer.

"We are going to find ourselves with more broken homes and families than we can afford," he said.

The groups sent letters to congressional leaders on Wednesday asking them to strengthen the Internet gambling law to make it clear that online betting is not what lawmakers wanted. "We must protect our children and families from the destruction of safeguards Congress has previously established," they wrote.

Referring to the DOJ's December interpretation of the law allowing in-state Internet gambling, the groups wrote that the decision "unleashed actions by a growing number of revenue-hungry state governments to turn the Internet into the largest casino ever, and welcoming into homes a greater social cost than any government can handle. This action is undermining Congress' clear intent when it passed the Unlawful Internet Gambling Enforcement Act in 2006 that online gambling should be prohibited."

Many states, including New Jersey and Nevada, are rushing to be among the first to get Internet gambling up and running before the competition. At the East Coast Gaming Congress last month in Atlantic City, a panel of industry and Wall Street experts predicted that Internet gambling will soon become a reality on a state-by-state basis, rather than by a national law, because Congress is too divided to agree on such a far-reaching measure.

Eugene Johnson, a senior associate with Spectrum Gaming Group, an Atlantic City-area casino consulting firm, said at the forum that his firm has been approached by numerous companies wanting help to position themselves for the eventual legalization of online gambling.

"I can attest to the Internet frenzy," he told the conference. "We've been involved with European operators, U.S. commercial gaming companies, Native American tribes and state lotteries. It's definitely a matter of when and not if. It is incredibly apparent that within a few years, state-by-state Internet gambling will become a reality in the U.S."

The casino companies and the states in which they operate say that hundreds of millions, if not billions, of dollars each year are being lost to bookies or offshore gambling operators, with no protections for the customer and no tax benefit for governments.

The letter said 10 states are considering Internet betting plans.

The groups that signed the letter are Wisconsin Family Action; The Family Foundation of Kentucky; Louisiana Family Forum Action; the North Carolina Family Policy Council; the Ohio-based Citizens for Community Values Action; the Pennsylvania Family Council; the Palmetto Family Council in South Carolina; the Missouri Family Policy Council; the Massachusetts Family Institute; the Minnesota Family Council & Institute; the Hawaii Coalition Against Legalized Gambling, representing 38 organizations; the Georgia Family Council; and Family Action of Tennessee.

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