The new year brought a new legislative session, and New Jersey lawmakers are renewing efforts to revitalize the state’s once-thriving horse racing industry.
The legislative actions also have the added benefit of providing a shot in the arm for Atlantic City casinos, who continue losing ground to their digital counterparts in monthly revenue reports.
Two bills that would expand gambling options at NJ horse racetracks were reintroduced shortly after the 221st State Legislature was sworn in on Jan. 9.
One would give state lawmakers authority to amend existing law in order to legalize slot machine gambling at horse racetracks. The other would permit racetracks to essentially serve as a proxy for Atlantic City casinos while NJ online casino players place digital wagers.
Both pieces of legislation have been referred to gambling subcommittees in their respective chambers. Neither proposal made it out of those same subcommittees in the previous two-year legislative session.
Horse racing tracks reap benefits of sports betting
However, the bills’ sponsors may have reason for more optimism this time around. Both proposals are more suited to the current state of legalized gambling in NJ than they were even just two years ago.
For obvious reasons, the bills assist NJ horse racing facilities, such as the Meadowlands, Monmouth Park and Freehold Raceway.
While those facilities have, to varying degrees, benefitted from their NJ sports betting partnerships with online operators such as FanDuel SportsbookNJ (Meadowlands), ESPN Bet NJ (Freehold) and BetRivers Sportsbook NJ (Monmouth) in the last few years, any increased foot traffic would be welcome news for a horse racing industry whose popularity and relevance is waning.
But, as always, gambling in New Jersey begins and ends in Atlantic City, the seaside gambling mecca that has never truly recovered from losing its decades-long East Coast casino monopoly. And, despite glowing news headlines declaring 2023 as the gambling industry’s best year ever, AC’s nine casinos are feeling the pinch from an unlikely in-state source: NJ online casinos.
Based on recent industry data, it appears online gambling is on pace to overtake land-based casinos in Atlantic City as the dominant gaming presence in the Garden State.
Each of the horse racing bills generates additional revenue to be sent back to Atlantic City, either directly or indirectly.
Here’s what the two bills would do.
Slot machines outside Atlantic City casinos
Senate Concurrent Resolution 14, or SCR14, needs the approval of New Jersey voters since it seeks to amend the state constitution. If successful at the ballot box, the resolution gives lawmakers the ability to change existing gambling laws by inserting language that would permit slot machines at horse racetracks.
The regulations and tax rates for the racetrack slots would be determined by the legislature.
According to the resolution’s text, the “state’s share of revenue derived” from the racetracks slots would “be dedicated” as follows:
- 60%: NJ state employee pension fund and/or pension fund debt obligations
- 30%: Atlantic City casino operators, proportionality based on “size of investment”
- 7%: Programs designed for the “recovery, stabilization, or improvement” of Atlantic City
- 3%: Programs that aid thoroughbred and standardbred horsemen
Online, AC casino betting from racetracks
Meanwhile, A107 is sponsored by former Atlantic City Mayor and current Assemb. Don Guardian, R-Atlantic. The proposal would allow racetracks to “be available” for NJ online casino players to place digital wagers at AC casinos.
The bill authorizes racetracks to enter into agreements with AC casino licensess or their online gaming affiliates.
The NJ Division of Gaming Enforcement will have jurisdiction over the online wagers placed at any participating racetracks. The proposed legislation explicitly states that “internet wagering from racetracks will not be subject to regulation by the New Jersey Racing Commission.”
The Atlantic City casinos or online casinos are responsible for revenue-sharing with the NJ racetracks, as per any agreements approved by the NJDGE.