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Iowa Politics Roundup: Gambling Bill Could Generate $80 Million for State PDF Print E-mail
Commentary/Politics - Iowa Politics
Written by Lynn Campbell   
Friday, 19 February 2010 15:54

A gambling bill that Iowa House leaders are pushing quickly to the floor could generate roughly $80 million in revenue for the state, a key legislator said Thursday.

About $70 million of that will likely be contained in an amendment allowing Iowans to play in live poker tournaments online, something state Representative Brian Quirk said an estimated 80,000 in the state already do illegally.

Quirk (D-New Hampton) said he wants to create a safe, regulated environment for those players, many of which are currently using offshore gambling Web sites that offer little protection to users.

"They're giving out their credit-card number to do it and it's just kind of [fraught] with fraud and a lot of risk," Quirk said.

Fellow subcommittee member Representative Doug Struyk (R-Council Bluffs) agreed. "Right now what's going on is illegal, offshore, and very risky for Iowans," Struyk said. "This would bring it under control of the Racing & Gaming Commission and only be legal intrastate."

The idea is for players to go to one of the state's 17 casinos and deposit money -- cash only -- into an account. The casino would then give the player an online account and password through which secure, live gaming against other Iowans would take place.

Quirk said there has been some push-back from colleagues on that proposal, but he stressed that moving forward on that idea could put Iowa in an enviable position should the federal government allow interstate online gaming, as is currently being discussed.

"The reason why I'm interested in it is, if Iowa can be the first to do this, that we could establish a nexus in Iowa," Quirk said. "My thought is it would generate a substantial amount of tax revenues for the state."

Quirk said Iowa could become a model for other states considering such online gaming, and software companies could end up basing themselves in the state as a result.

"If that does happen Iowa will be poised to be in the driver's seat on this stuff and grow a pretty substantial industry in the state," Quirk said.

Pharmacy Board Supports Medical Marijuana

The Iowa Board of Pharmacy voted unanimously to recommend the state allow marijuana use for medical purposes, although the board's chair believes it will be at least a year before medical marijuana becomes legal in Iowa; the legislation did not clear the legislature's recent funnel deadline.

"It was a long process, a lot of work for a lot of people, but now it's in the hands of the legislature for how fast it goes through," said board Chair Vernon Benjamin.

The board recommended rescheduling the drug from Schedule I to Schedule II. Schedule II drugs are recognized as having a currently accepted medical use, while Schedule I drugs are not. The board also recommended the legislature appoint a committee to discuss the parameters of a medical-marijuana program by getting input from other states' programs.

"A lot of them have made a lot of big mistakes, and our intentions are to make sure that the Iowa program got developed where we could eliminate a lot of the potholes that other states have had," Benjamin said.

Benjamin said he thinks there should be several key parts in an Iowa law:

  • Patients should vaporize rather than smoke the drug;
  • There should be some form of ID-card system;
  • The state should tax the drug; and
  • There should be a government-run marijuana dispensary rather than individual growers.

The 14 states that have medical marijuana programs have varying laws, but Benjamin sees individual growers as a potential pitfall.

Senator Joe Bolkcom (D-Iowa City), who presented a bill on medical marijuana during the 2009 session, said he will refine that bill for the 2011 session instead of trying to move it forward this year.

"I don't think we're going to find common ground this session on this bill," Bolkcom said. "There's too many other important pieces of business to conduct, and we don't have a consensus at this point on the language that can move forward."

Bolkcom said the Iowa Board of Pharmacy did a good job of providing a forum for people to speak on the issue over the past several months. He also said he likes the board's recommendation to bring stakeholders together for a committee to discuss an Iowa medical-marijuana system.

Legislative Leaders Release Budget Targets

A framework for the Fiscal Year 2011 state budget released by Iowa legislative leaders would spend $474.7 million less in the general fund than recommended by Governor Chet Culver and $260.8 million less than the current fiscal year, which amounts to about a 5-percent cut.

The biggest difference is in health and human services, where Democratic lawmakers have projected spending $372.3 million less than recommended by Culver. In education, lawmakers project spending $16.6 million less than recommended by the governor.

The release of budget targets is the first step in the legislature's budgeting process. The seven budget subcommittees will now craft specific legislation with their priorities.

Helping lawmakers to balance the budget this year is an estimated $250 million in savings from government reorganization. That includes more than $120 million in savings from Senate File 2088, nearly $60 million from early retirement of state workers, and more than $70 million through an executive order by Culver.

Lawmakers are also conducting a review of corporate tax credits to determine which ones aren't creating jobs or accomplishing their goals. They plan to fix or eliminate ineffective corporate tax credits.

The budget targets amount to about $2.5 billion because they only include spending by seven budget subcommittees.

Left out of the numbers are general-fund spending in the standings bill (which includes K-12 education), cash-reserve fund transfers, or any revenue adjustments (such as ending tax credits).

"These targets give the public an incomplete picture of the Democrats' spending plan," said House Minority Leader Kraig Paulsen (R-Hiawatha).