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A bill to ban sweepstakes casinos in New Jersey took another step last week, when Assembly Bill 5447 made it through the Assembly Appropriations Committee on an 11-0 vote.
The committee is responsible for reviewing the fiscal impact of legislation on the state. The Office of Legislative Services, which supports the NJ Legislature, could not determine a specific financial impact from banning sweeps, but it did say that costs to the state would rise.
“The OLS finds that broadening the scope of unlawful gambling practices and expanding and establishing penalties for such practices may result in indeterminate annual revenue increases to the State by virtue of the enforcement powers granted to the Division of Consumer Affairs and the Division of Gaming Enforcement.
“The OLS anticipates that the Division of Consumer Affairs and the Division of Gaming
Enforcement, in addition to the Judiciary, will also experience workload and administrative cost
increases due to their expanded responsibilities under the bill.”
Sweeps have been subject to controversy across the US, especially in markets without legal gambling like California. New Jersey, however, does have legal online casinos and sports betting apps.
Potential financial impact on sweeps ban
The elimination of sweeps casinos would likely drive customers to legal platforms, which would help the state generate more tax revenue. For operators breaking the law, fines would be assessed, with the money likely going into the state’s general fund.
Sweepstakes casinos operating in New Jersey could face up to a $100,000 fine for the first offense and a $250,000 fine for subsequent offenses under the bill. The Division of Consumer Affairs and the Division of Gaming could also take legal actions.
AB 5447 also includes fines for individuals, according to a summary.
“The bill expands the scope of criminal conduct concerning the maintenance of a gambling resort to include the maintenance of an online gambling resort, and increases the penalty from a crime of the fourth degree to a crime of the third degree.
“The bill increases the maximum penalty for maintaining a gambling resort from $25,000 to $50,000 and provides that the penalty for maintaining an online gambling resort shall be no less than $50,000 and no greater than $100,000.”
Assemblyman Clinton Calabrese introduced the bill in March, which was a pivot from the previous legislation he brought forth in January, which would have allowed sweepstakes casinos.
