CALIFORNIA

SB 1463, sponsored by Senators Wright and Steinberg, would provide for the licensure, regulation and taxation of Internet gambling, with licensees initially restricted to authorized poker games; additional games may be phased in, if allowed under the California Constitution and Penal Code. Some key points in the legislation are:

· Licenses for 10-year terms, with a required review in the third year.

· Initial licenses shall take effect simultaneously no later than Jan. 1, 2014.

· Licenses restricted to those holding a CA "owner license," federally recognized CA-based tribes operating a casino pursuant to a tribal-state compact, horse associations holding a license from the California Horse Racing Board ("CHRB"), and ADW operators regulated by the CHRB for at least 3 years.

· License application fees will be $1-5 million, as needed to cover expected costs of investigation and determining suitability, with excess returned or additional amounts paid if needed.

· Tribal are applicants required to waive sovereign immunity for purposes of licensure evaluation and tribal licensees must agree to be subject to CA jurisdiction in relation to I-gaming.

· Licensees must pay a nonrefundable license fee of $30 million, which will be used to cover a monthly deposit to the CA General Fund equal to 10% of its gross revenues. When the $30 million is depleted, the licensee shall directly make the monthly payment.

Please see full publication for more information.