D.C. first in U.S. to legalize online gambling

WASHINGTON — The District of Columbia is becoming the first U.S. jurisdiction to allow Internet gambling, trying to raise millions of dollars from the habits of online-poker buffs and acting ahead of traditional gambling meccas like New Jersey and Nevada.

Permitting the online games was part of the 2011 budget, and a 30-day period for Congress to object expired last week, said D.C. Council member Michael A. Brown, who authored the provision.

The gaming would be operated by Intralot, a Greece-based company, and would be available only to gamblers making bets within the borders of the district.

Officials were not sure when the gaming would be up and running, though D.C. lottery officials said they were in talks with their vendor and expect to know more within weeks. Though other states have contemplated legalizing online poker, experts said the district would be the first jurisdiction in the country to do it.

The move to legalize the games comes despite a 2006 federal law that effectively banned Internet gambling. The law prohibited banks and credit-card companies from processing payments to gambling websites in states where such transactions would violate state law.

But gambling experts say the law created gray areas that open the door for an expansion into the multibillion-dollar industry.

A spokeswoman for the U.S. Justice Department, which has traditionally viewed Internet gambling as illegal, declined to comment Tuesday.

"There was really no clear law that said we could not do this," Brown said Wednesday.

D.C. hopes to tap those millions to help offset budget cuts and help social-services programs, Brown said. Conservative estimates from D.C.'s chief financial officer indicate the district could bring in $13 million to $14 million through fiscal year 2014, according to his office.

The gambling green light is no doubt good news to poker players, but D.C. would be authorized to offer other games of both skill and chance. It would be up to lottery officials to come up with regulations and decide which games to permit.

"Anytime you're cutting budgets and you want to save some programs, you're looking for different pieces from different pots and you hope that you get to the number that restores those budget shortfalls and that's what we're trying to do with this," Brown said.

Online-poker games generally allow computer users to deposit money into an account and place wagers against other players similar to real gambling.

Efforts to legalize Internet gambling have stalled elsewhere this year, including in New Jersey, where Gov. Chris Christie vetoed a measure partly out of concern that bars, nightclubs and amusement parks would add online gaming to attract more customers.

A bill in Hawaii died in the Legislature, and one in Iowa is unlikely to move forward in its current form.

In Nevada, lawmakers have been debating proposals to require state gambling regulators to create rules for Internet poker operations and companies that make related equipment.