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NJ Lawmakers Consider Constitutional Amendment To Online Gambling and Sports Betting On November Ballot

Posted on June 19th, 2010

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State lawmakers called for a gambling summit Thursday involving lawmakers, policy experts and industry officials that would tackle the problems of Atlantic City casinos and the state’s racetracks. The five lawmakers, Democratic Senators Raymond Lesniak, Jim Whelan, Jeff Van Drew, Senate President Stephen Sweeney and Assemblyman John Burzichelli intend to put before voters during this year’s November elections questions on allowing sports betting and online gambling in the state in an attempt to save the casino and racetrack industries by implementing a plan that would boost the state’s revenues to the highest possible level. But that is if, the federal ban on sports betting is abolished.

Sen. Lesniak is taking legal action against the federal government to reverse a ban on sports betting under a law passed in 1992. The law does not allow sports betting in all states except in Nevada, Delaware, Montana and Oregon which had already allowed the practice in 1991 before the law was implemented. Lesniak is confident that everything will be ready by the end of August, early enough for the questions to be included on the November ballot.

Atlantic City’s 11 casinos and New Jersey’s racetracks are in conflict over the elusive gambling money. The casinos pay the horse racing tracks $30 million a year as grants to add to the racing purses in exchange for a deal in which the tracks are not allowed to operate slot machines.

But officials of Atlantic City casinos are now determined not to give their annual contribution to the racetracks, and the racetrack officials are endorsing the idea of putting slots at the Meadowlands Racetrack to draw more gamblers, with part of the new slot revenues to be used to supplement racing purses in lieu of the Atlantic City casino subsidy. The proposal has been strongly opposed by the casinos and south Jersey lawmakers.

The two questions that the constitutional amendment would present to voters statewide in November would be whether New Jersey be allowed to offer sports betting, and whether the state be able to offer casino games like blackjack, poker, roulette and others on the Internet.

Atlantic City is fast losing its title as the gaming capital of the Northeast region to Pennsylvania. There are now nine slots parlors in Pennsylvania since slots gambling started in the state in 2006, which will soon be expanded to casino-style table gaming starting next month. In 2006, Atlantic City’s overall gambling revenue was $5.2 billion.

At the onset of the economic recession, and as gambling competition exploded from all around New Jersey’s neighboring states, Atlantic City’s 11 casinos saw declines in revenues never before experienced by the city’s gambling industry. In 2009, overall gambling revenue had dropped to $3.9 billion, and so far this year, it is lower by 7.9 percent from the same period in 2009 at $1.49 billion.

The state’s racetracks are suffering just as much. Industry leaders say the tracks need slot machines to bring in new customers. Four months ago, New Jersey Republican Governor Chris Christie announced that he has formed a commission and has appointed former New Jersey Sports and Exposition Authority Chairman Jon. F. Hanson in-charge of the official group that would conduct a study and analysis on the future of the casino and racetrack industries in New Jersey.

The governor said he will wait for the result of the Hanson study before working things out with the casinos and the racetracks. The governor’s spokesman, Michael Drewniak said the governor is anticipating the report of the commission which would deal with the gambling industry’s concerns. The deadline for Hanson to hand in his report is June 30.