West Virginia Online Gaming Legalized as Governor Justice Allows Bill to Lapse Into Law

Posted on: March 28, 2019, 08:13h. 

Last updated on: March 28, 2019, 08:13h.

Philip Conneller @casinoorgphilc Read More

Expertise: Gaming Business, Regulation, Tribal Gaming.

West Virginia’s Interactive Wagering Act lapsed into law on Wednesday after the veto deadline passed without action from Republican Governor Jim Justice.

The governor’s quiescence means the Mountain State becomes only the fourth in the US to legalize online casino gaming and the fifth to legalize online poker, after New Jersey, Delaware, and Pennsylvania. Nevada authorized poker in 2013, but not casino.

The new law will enable West Virginia’s five land-based casinos to offer online casino gaming to customers aged 21 and older under the oversight of the West Virginia Lottery Commission.

Five-year licenses will cost $250,000, renewable for $100,000 every five years. Platform and service management licenses will cost $100,000 every five years. The state will tax the new operations at a reasonable 15 percent of gross gaming revenue.

Timeline Unclear for West Virginia Online Gaming

While it’s difficult to put a timeline on the launch of the online gaming market, OnlinePokerReport has noted the West Virginia passed its sports betting bill in 2018 at around the same time of year and the first operations launched the following December.

First, the Lottery Commission must formulate a framework of regulations for online gaming. The bill advises the commission to “examine the regulations implemented in other states where interactive wagering is conducted and … as far as practicable, adopt a similar regulatory framework through promulgation of rules.”

Asserting States’ Rights

The timing of the bill’s enactment is interesting, since it comes just months after the Department of Justice revised its opinion on the Wire Act, reversing the Obama-era opinion from 2011 that paved the way for the state-sanctioned online gaming.

The new opinion potentially threatens the existence of these markets – and all forms of interactive gambling – and may cause some states that are discussing online gaming to hold back.

But West Virginia would not be cowed. In fact, the language of the bill expressly asserts the state’s Tenth Amendment rights.

“The federal government is a government of limited and enumerated powers, and powers not delegated to the United States by the Constitution nor prohibited by it to the states are reserved for the states and its respective citizens,” states the bill.

“The Legislature finds that section 36, article VI of the Constitution of the State of West Virginia grants the state the exclusive right to lawfully own and operate a lottery in this state,” it adds. “Authorization of wagering on any constitutional lottery within West Virginia is within the state’s sovereign rights as a state to act in the best interest of its citizens.”