California has rejected emergency budget measures designed to fix the state's budget crisis, providing a major fillip to a framework bill proposing to legalize intrastate online poker as early as next year.

In a special budget referendum yesterday, state voters rejected five of six budget measures centred on tax raises, social spending cuts and borrowing from the state lottery that were designed to plug a major hole in the US state’s finances.

The failure to pass the measures could see California, the world's sixth largest economy, go more than $25 Billion into debt by the end of this financial year, providing a boost to a framework bill proposing licenses for legal, taxed intrastate online poker to help prop up state coffers.

Jim Tabilio, president of grassroots gaming advocacy group Poker Voters of America (PVA), which sponsored a framework bill in 2008 which passed the state's lower house, told eGaming Review: “The framework bill has a majority in support of the concept in both the Assembly and the Senate, and has a group of legislators including people in the leadership in both houses ready to take it forward.”

The bill was introduced by California Assemblyman Lloyd Levine last year, but dropped down the legislative agenda when the economic downturn diverted attention elsewhere and Levine left office at the end of his maximum of two terms.  However Jim Tabilio said that he had been instructed by members of the California legislature to continue working on this bill so it meets its goals of consumer protection and raising state revenue.  Tabilio said the proposal to only allow the roughly 60 native Indian tribes with gaming compacts and 91 licensed land-based card clubs in the state to apply for licenses remains in the framework bill.

He said he was confident provisions could be quickly drafted working alongside these stakeholders to lend potential licensees the ability to compete in the online poker space, given the urgency of the budget problem.

Tabilio added: “It’s a case of writing the bill so it maximizes revenue to the state and participating tribes and clubs. Once that is successful, it becomes a simple matter of having the vote because if everyone is in favor of it, it will pass. This means we’re probably going to be able to get the bill through in mid-summer.”

Given the mounting financial pressure it finds itself under, Tabilio thinks the state goverment would then opt to file for temporary regulatory structures to push the initiatives through, so license holders could be offering online poker to California residents from as early as January 2010.

Speaking to EGRmagazine.com yesterday, California-based independent gaming lawyer Martin Owens said: “The state of California now can’t afford to ignore anything that might turn into a reasonable source of revenue, and here you have a multibillion dollar industry that is volunteering to be taxed.”

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