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Chaffetz fears bill on gambling

Utah congressman says it could force Utah to allow all forms of wagering

Jason Chaffetz
Jason Chaffetz

Rep. Jason Chaffetz, R-Utah, worries that Congress is about to legalize online gambling and that it could unintentionally lead to legalizing all forms of gambling in Utah.

He is issuing a call for legal experts and other interested parties to organize and fight what he says could otherwise be a quick passage of legislation.

"I'm raising the red flag," Chaffetz told the Deseret News on Wednesday. "I feel the imperative to get this organized before it is too late."

House Financial Services Committee Chairman Barney Frank, D-Mass., and Sen. Robert Menendez, D-N.J., have both introduced bills that would legalize online gambling, regulate it and tax it.

Chaffetz says a chance meeting he had with Frank makes him worry that unlike similar past efforts that went nowhere, Frank is deadly serious about legalizing online gambling this year, and it could come up quickly without much time to organize opposition.

"I saw him in the airport in Salt Lake a number of weeks ago," Chaffetz said. "I said, 'Barney, what are you doing here in Salt Lake?' He was traveling back from Las Vegas, which led to our discussion about his Internet gambling bills."

Chaffetz said, "He assured me that come this fall, he would be getting these bills through his committee, and I believe him … He may be bluffing, but we can't afford to take that chance."

Chaffetz worries that if online gambling is allowed nationwide, it could force allowing other forms of gambling in Utah.

That is because federal law since 1988 has recognized the right of Indian tribes to build casinos or other gambling establishments on their reservations, as long as the state where they are located has some form of legalized gambling. Utah has no tribal casinos because the state bans all forms of gambling.

Chaffetz fears that if Congress allows online gambling nationwide, "it would be the camel's nose under the tent that would then say, 'Well, now that you allow gambling in your state, even though you oppose it,' that it would open it up and allow gambling on Indian reservations."

Frank's bill as introduced, however, allows states and tribal governments to opt out of allowing online gambling by people within their borders. But, Chaffetz said, "that's very 'iffy.' It's not rock solid."

He added, "That's why I want to make sure we've got the best legal minds and interested parties in opposition to this rallied together to be prepared … If it does come up, it's going to be swift and fast, and there will be (only) days to react."

Chaffetz said he has been contacting such potential opposition groups, but is talking to the media about it now to seek wider support.

While past efforts to legalize online gambling did not go far, he said, "the power brokers have changed," and Democrats now control both houses of Congress and the presidency.

Chaffetz said Democrats are also seeking new revenue sources to help pay for health-care reform and other spending, and Sen. Ron Wyden, D-Ore., even briefly introduced and then withdrew an amendment saying taxes on online gambling could produce $62.7 billion over 10 years to help the government.

"There aren't a whole lot of places to go grab that kind of money. It's a staggering amount of gambling," Chaffetz said.

"There's no doubt that with all the spending that Democrats are putting on the table that they have to come up with new sources of revenue. And allowing legalized gambling online and then taxing it may be, in their view, more palatable than raising taxes on other traditional services," he said.

"This has an unfortunate and real potential of happening," he said. "This is a big deal. I can't impress upon you how big of a deal this is."