NJ Legislature Tries To Get Racetrack Gambling In Under The Wire

Written By Eric Ramsey on December 13, 2017

[toc]Gamblers in northern New Jersey won’t be getting casinos any time soon, but they may be getting the next best thing.

A bill that would allow racetracks to offer NJ internet gambling is suddenly making progress in the state legislature. Last week, the General Assembly overwhelmingly passed the bill more than a year after it was first submitted.

There is a matching bill on file in the Senate.

The history of the bill

During the 2016 elections, one of the items on New Jersey ballots was a referendum that would have permitted casinos outside of Atlantic City. The measure was pushed hard by two of the state’s largest tracks, Meadowlands Racetrack and Monmouth Park.

Voters struck down the effort by a big margin though.

Proponents will likely push again in 2018, but legislators may have found a loophole in the meantime. Following the elections, the Assembly was read a bill allowing racetracks to operate what are, in essence, internet cafés.

A 4255 was introduced by Assemblyman Ronald S. Dancer and sponsored by five other members. It was quickly referred to the Assembly Tourism, Gaming, and the Arts Committee, where it escaped onto the floor by a 4-3 vote. The bill sat idle until last week, when the General Assembly finally voted on it. It passed 60-12.

The matching Senate bill, S 2946, was introduced by Sen. Jennifer Beck on Jan. 30 and is still lingering in Committee.

What does the bill do?

Given casinos aren’t coming to the rest of New Jersey in the near future, this bill represents the next best thing for racetracks.

If it becomes law, the bill would allow racetracks to partner with casinos to offer online gambling on their premises. It would exempt racetracks from the statewide ban on internet cafés, and give jurisdiction to the Division of Gaming Enforcement.

“This bill would permit a running or harness horse racetrack in this State to enter into an agreement with a casino located in Atlantic City, or such a casino’s Internet gaming affiliate, that allows the racetrack’s premises to be available as a venue at which the holder of an Internet gaming account may place wagers at casinos using the Internet.”

Since internet gambling is already legal in New Jersey, the bill infers that a legislative workaround would not require voter approval.

What a New Jersey internet café might look like is to be determined, but racetrack figureheads envision a sort of upscale gambling lounge.

The arguments for and against racetrack casinos

Given the amount of money used to defeat casino expansion, there is a fair amount of opposition to the new plan. The referendum vote was lopsided against by more than 3:1.

On the other hand, online gaming revenue is bullish in the state, providing plenty of ammunition for those in favor.

What are critics saying?

Critics argue that expanded gambling would deal another blow to Atlantic City’s floundering tourism numbers. Overall, though, casino revenue is trending upward thanks to iGaming’s escalation, and cannibalization concerns have been all but put to rest.

There is also some fear that these remote internet gambling stations would ultimately become slot parlors indistinguishable from those in Atlantic City casinos.

Assemblyman Vincent Mazzeo is the one with his hand in the air in the corner of the room. In an interview with Politico, Mazzeo indicated that something about the proposal rubs him the wrong way.

“This intent was not what we thought when we came here. And now that you read into the bill and heard the testimony, there’s something up here. Something doesn’t smell right.”

What are proponents saying?

Dancer and his co-sponsor, Assemblyman Declan O’Scanlon, take their stance on the other side of the issue. In a press release, O’Scanlon argues that the agreement will be mutually beneficial to both parties.

“Combining these two popular pastimes in the same venue will boost two vital segments of our economy. The unique mix will attract new patrons to the racetracks and complement New Jersey’s tourism industry. Atlantic City casinos, capitalizing on increased exposure, will see internet revenues continue to soar, adding to state tax revenue.”

New Jersey gamblers are already doing so online, and in increasing numbers. For all of Atlantic City’s struggles, gambling is still alive and well. It’s just taking on a different shape than it did five years ago.

Since legalization in 2013, iGaming in New Jersey has become a freight train of revenue. It has grown from an infant industry into one that generates more than $20 million per month.

Total revenue is up around 25 percent year-on-year, and online gambling now accounts for 10 percent of the total money wagered. Some brick-and-mortar casinos (in which floor space is at a premium) have even installed iGaming lounges inside their buildings.

Another of the bill’s sponsors, Assemblyman Ralph Caputo, was more succinct in his rebuttal of opponents’ concerns.

“Well, you know what? This is how the world turns. I guess we’re going to have gaming at the tracks.”

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Eric Ramsey

Eric is a reporter and writer covering the NJ gambling industry, online poker, sports betting regulation, and DFS. He comes from a poker background, formerly on staff at PokerNews and the World Poker Tour.

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