Online Gambling: Nevada Becomes First State to Legalize Online Gambling

A crazy day of arm-twisting and legislating was capped off on Thursday when Nevada governor Brian Sandoval signed an emergency measure passed by both Nevada houses, becoming the first state to legalize online gambling in the United States. The powers that be in Nevada, wanting to beat New Jersey as first in the country, rushed through the new law thanks to some rare bipartisanship action by Nevada lawmakers. The bill swept through both the Assembly and Senate on Thursday after a joint hearing before the two judiciary committees.

“This is an historic day for the great state of Nevada,” Sandoval said, surrounded by dozens of state lawmakers. “Today I sign into law the framework that will usher in the next frontier of gaming in Nevada. This bill is critical to our state’s economy and ensures that we will continue to be the gold standard for gaming regulation.”

Nevada Legislators in 2011 passed a bill that put Nevada in position to legalize Internet gambling if the federal government sanctioned it. But when those efforts failed in Congress, Sandoval said Nevada would work toward agreements with other states. This became possible when the Department of Justice issued a ruling in 2011 clarifying that the federal Wire Act of 1961, used to crack down on gambling over the Internet, only applies to sports betting.

The bill is critical to Nevada’s economy because it will enable existing licensed gaming companies to take the lead in making online poker available around the country, potentially giving them a competitive advantage over operators in other states.

Horne said in testimony at the joint committee hearing that online gaming will generate new jobs, $3 million in tax revenue and create an economic output between $10 million and $15 million. The bill also allows Nevada companies to enter compacts with other states that have a player base.

An online gaming license will cost companies $500,000, with the Nevada Gaming Commission having the power to change those fees under certain conditions. The renewal fee has been set at $250,000.