Christie Vetoes Online Gaming

NEWS & VIEWS

By Mike Pritchard

Add Comment | Comments: 0 | Posted Mar. 3, 2011

Governor Chris Christie has vetoed a bill that would have made New Jersey the first state to regulate online gaming.

However, according to reports, Christie’s veto may not be the last word on the idea.

Christie released a statement saying he vetoed the bill “citing both the inconsistency with his administration’s commitment to revitalizing the gaming and tourism industries in Atlantic City and legal concerns with the legislation.”

In his veto message, Christie "recognized as laudable the intent of the bill to make New Jersey a more competitive gaming jurisdiction," while citing "numerous concerns with the legislation as it relates to the administration’s stated policy objectives and the New Jersey State Constitution, including potential allowance of gambling outside of Atlantic City’s borders and the continuation of a public subsidy for horse racing, respectively.  

 “I wholeheartedly support the intentions of the Legislature to make New Jersey a more competitive gaming jurisdiction," said Christie. "However, I do not believe that Internet gambling as contemplated in S-490 is a viable option for continuing the progress that we have made so far in reversing the fortunes of the casino industry in New Jersey.”

Christie maintains in his veto statement that the bill doesn’t sufficiently prohibit commercial establishments such as bars, nightclubs and amusements parks outside of Atlantic City from offering online gaming. Christie said he feels the bill could actually undermine the state’s policy of limiting gambling to Atlantic City.

Christie also said that as the state Constitution requires gambling to be limited to Atlantic City, saying that a gambler in another part of the state’s wager “originated” in Atlantic City because of the online system would be a “legal fiction” and cannot overcome the language in the constitution.

Christie also objected to a portion of the bill that would have funded a $30 million annual subsidy for the state’s horse-racing industry. Christie opposes state subsidies to horse racing saying he wants the industry to become self sufficient.

Finally, Christie said that if the Legislature wants to expand gambling, it should put a ballot referendum before voters.

Despite the absolute veto, efforts to refine the bill to meet Christie’s concerns may already be underway.

Joseph Brennan Jr., chairman of a group called iMEGA, the Interactive Media Entertainment & Gaming Association, which represents offshore Internet betting websites, told the Associated Press that Christie raised valid concerns that were not addressed in the legislation.

"My understanding is the governor is concerned about hotels or bars setting up Internet cafes," he said. "He also has concerns about youth participation in gambling and making sure only state residents are able to participate. He's concerned that some places may put together eight computers and set up a de facto back-room gambling hall that wouldn't be monitored or regulated."

Brennan said the online gambling industry wants and welcomes strict regulation, and said a new version of the bill could be introduced as early as next week.

Meanwhile, The Casino Association of New Jersey also called for a public referendum in November on the issue, which is a bit of a departure from their previous opposition to the bill.

Again the AP reports:

"The right way to get this bill done to avoid costly and time-consuming legal wrangling is through a referendum placed before voters on this November's ballot, and we are committed to working with the governor and our legislative leadership to make that happen," said Robert Griffin, the group's president and Trump Entertainment CEO.

"Currently, millions of Americans engage in online gaming with illegal offshore operators, and do so with no oversight, no regulation or no consumer protections," Griffin said. "It makes sense for the state of New Jersey to regulate this activity, enforce strict standards to ensure games are fair and safe, and in turn be able to collect tax revenue instead of having those dollars and the jobs they support leaving New Jersey and going illegally overseas."

The online industry group said approval of the law could create between $210 million and $250 million in new revenues for Atlantic City casinos during online gambling's first full year of operation. It also could create 1,586 to 1,903 jobs and $47 million to $55 million in New Jersey tax revenue, the group estimated, according to the AP.

However, a recent poll by Farleigh Dickenson University found that 67 percent of state residents were against online gaming. So supporting a referendum could be just a more artful way for the association and other opponents to kill the idea.

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