Senator hopes sports betting saves gaming

Study: Wagering could bring $6.7 billion into New Jersey

October 24. 2011 5:00AM


A look at state Sen. Raymond J. Lesniak's legislative playbook shows his plan to aid the ailing horse racing and casino industries relies on a Hail Mary pass from sports betting.

But while Lesniak's charge to overturn a federal ban on the practice has support in the polls, he still faces a long road to bring this Las Vegas standby to New Jersey.

"Why do we have to waste law enforcement resources to bring criminal investigation and charges against people doing something that they could legally do in Las Vegas?" said Lesniak (D-Union). "What's wrong with this picture?"

While public opinion polls show broad support for amending the state constitution to allow a sports-gaming law, it would be just the first in a series of hurdles that must be jumped before New Jerseyans can legally place bets. Lawmakers would have to introduce and pass a bill allowing the practice, and such legislation is likely to lead to a lawsuit challenging a federal ban on sports betting, which is on the books in every state but Nevada, Delaware, Montana and Oregon.

Club Cal Neva, a Reno, Nev., casino, completed a study that found sports betting would be a $6.7 billion industry in New Jersey, bringing in $166.2 million in tax revenue. The company projected higher totals if the state allows sports betting at a site in Cherry Hill, outside of Atlantic City and the racetracks.

Philadelphia-based economic analysis firm Econsult Corp. said expanding to sports betting would be a natural move for Atlantic City casinos, which have seen steep drops in revenue due to increased competition from out of state and the recession.

"Under competitive pressure, firms often respond by expanding into new areas," Econsult associate Adam Ozimek told lawmakers at a Senate committee meeting. His firm estimated 1,600 jobs would be created just from the online portion of New Jersey sports betting.

Likely New Jersey voters support the amendment by a 58 percent to 31 percent margin, according to a Rutgers-Eagleton poll released Oct. 19.

Lesniak noted support for the referendum, but added a note of caution.

"You always have concerns on a low-turnout election — as this year is — that the folks who may support something like this may not come out to vote, and the ones who oppose it may come to vote," said Lesniak, who saw an earlier lawsuit challenging the federal ban rejected.

The amendment is supported by the New Jersey Thoroughbred Horsemen's Association, the Standardbred Breeders and Owners Association of New Jersey and prospective Meadowlands Racetrack operator Jeffrey Gural, who all said additional revenue is essential to the future of racing in the state.

"The reality is that the purses at Yonkers and Pocono and Chester are higher" than those in New Jersey, luring top horses away from the state, Gural said.

The Greater Atlantic City Chamber of Commerce supports allowing sports betting, but wants the state to restrict it to sites in Atlantic City, rather than allowing it at both casinos and horse racing sites, as the referendum would allow.

"The ball is moving in the right direction," chamber President Joseph D. Kelly told the Senate committee, but the chamber is concerned that "if it's not exclusive to Atlantic City, that it will be marginalized, and that the true benefits statewide won't be seen."

The Casino Association of New Jersey issued a statement in support of the amendment, but officials declined to comment further.

While several in-state groups are enthusiastic for the amendment, it also would likely attract opposition from long-standing sports gaming foes, like the National Football League. An NFL spokesman did not comment directly on the referendum, but said the league opposes expanded sports betting.

"We have a long-held unwavering opposition to gambling on NFL games," Brian McCarthy said. "We have been an active proponent of federal and state legislation that prohibits the spread of legal sports gambling."

McCarthy said the league continues to support the federal restrictions, noting that the 1992 law limiting sports betting was backed by then-U.S. Sen. Bill Bradley, of New Jersey.

Another likely opponent is the NCAA, though the proposed amendment does put limits on collegiate sports betting barring the state from allowing gambling on games that are played in New Jersey, or played out-of-state by New Jersey college teams.

Despite the prospect of legal opposition to the change, Lesniak said he's hopeful it will be resolved quickly, should residents pass the measure.

"It's just a matter of law. It won't be an extensive trial-and-discovery period," Lesniak said, adding he hopes state residents will be able to legally place bets the first time the New York Giants play the Philadelphia Eagles next season.


E-mail to: akitchenman@njbiz.com


www.NJBIZ.com