A Look Inside the Nebraska Poker Legalization Bill

Add Nebraska to the growing list of US states where legalized wagering on poker may soon be available in an increased way.  A new bill was introduced last Wednesday by Nebraska State Senator Tyson Larson, which would legalize Nebraska poker games by declaring poker a game of skill, and thus render it protected from Nebraska’s broad gambling prohibitions.

Larson, a Republican who at 28 is the youngest member of Nebraska’s state senate and who describes himself as having a strong libertarian bent, views the arguments over poker as a way to have the game’s “skill game” attributes recognized, while also providing an economic boost to such outlets as state bars and charitable and service organizations.

Larson is using the skill-game argument surrounding poker as a way to navigate around Nebraska’s existing code, which otherwise prohibits Nebraska legislators from authorizing “games of chance” in a state with relatively few gambling options.  A handful of small tribal casinos dot the eastern part of the state (though none offer poker), while keno and bingo are available for play by consumers through a wider spread of venues.

Larson’s measure, Legislative Bill 619 (LB 619), would amend Nebraska’s liquor-license statutes by allowing bar owners and others to purchase a special license authorizing them to provide poker games as entertainment to their patrons.  Both draw and “community card” games would be authorized under the bill — not just Texas hold’em, as most recent news reports erroneously state.  The bill would authorize a thin rake of up to 5% on Nebraska poker cash-game action, and also authorize tournaments, for which up to 10% in entry fees could also be added.  The rake and entry fees would be transmitted directly to the state; the offering venues would need to derive their own profits from other offerings, such as food/beverage sales.

Larson’s bill would earmark 50% of the funds raised through taxation and licensing fees to go into the state’s general property-tax fund.  Another 49 percent would be returned to local governments, half each to the village and county where the poker game was held, while the remaining one percent would be dedicated to a statewide program to deal with problem gambling behavior.

“You can be a professional poker player; you cannot be a professional coin flipper,” Larson told the Lincoln Journal-Star. “You can lose a poker game on purpose; you can’t lose a coin flip on purpose. You can have the worst hand in poker but be the best player.

“The math is there; the statistics are there,” Larson added. “Poker is a game of skill; it is not a game of chance.”

Nonetheless, Larson’s bill faces an uphill battle.  Both the legislature’s senior members — largely Republican — and sitting Governor Pete Ricketts are already on record as opposing any expansion of gambling in the state.  Still, Larson’s LB 619 has already received its first reading and been referred to Nebraska’s Senate Committee on General Affairs, which Larson himself chairs.

A look inside LB 619 shows how Larson would define poker as a game of skill under Nebraska law.  As added to the state’s liquor laws, the bill begins with this:

(1) The Legislature finds that:

(a) Certain poker games require skill and players that are able to develop that skill may become professional poker players; and

(b) While poker does have a random component in the cards that players are dealt, there is more skill than luck for successful poker players in games where the player implements a strategy by making decisions that influence the other players and ultimately the game’s outcome.

(2) It is the intent of the Legislature to recognize various forms of the card game, poker, as games of skill, including variations of draw and community card poker games.

The bill goes on to decree an age 21 minimum for playing, while also barring owners and employees of the hosting venue from taking part in the games.  The licenses issued to applying venues would be single-day licenses only, costing $40 per day, and could be used only six times per calendar year.  In that way the licensing structure would be quite similar to that employed in charitable-gaming structures available in other, nearby Midwestern and Great Lakes states, which have created such mechanisms for fundraising purposes.

Buy-ins for poker games and tournaments held via the proposed measure are also mandated to be cash-only, with neither checks nor credit cards accepted as alternate payments.  In addition, the hosting venue and its staff would be prohibited from providing any sort of credit to would-be players.