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As N.J. antes up, other states look to become leaders in online gaming

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New Jersey's near-term hopes for legalizing Internet gaming became clearer Thursday, as Gov. Chris Christie backed the concept in a conditional veto. But its long-term prospects of becoming a national leader are still complicated by similar efforts in other states, which have ramped up recently, and the lack of federal guidance on interstate wagering.

Delaware signaled its plans to forge ahead earlier this week, when the state lottery requested proposals from operators who could help implement its online gaming law, said Frank DiGiacomo, a Duane Morris gaming attorney. The state hopes to go live and take online bets from players inside its borders by Sept. 30.

In Nevada, where only online poker is legal, lawmakers started a new session this week and are expected to consider a bill to allow operators to accept wagers from other states. DiGiacomo, who is based in Cherry Hill, said time is of the essence for the nation’s gambling capital, because its Legislature only meets once every two years.

“I think New Jersey’s window of opportunity to be at the forefront of this is now,” said DiGiacomo, who co-chaired an Internet gaming conference in Atlantic City early this week. He also noted that other states like Massachusetts and Pennsylvania are studying or discussing the idea of their own online gambling laws.

Current laws in other states and the proposal in New Jersey only allow intrastate gambling, largely because the federal government has not legalized such gaming across state borders. But advocates here have long called for Garden State to enact and implement its law so that the state can take the lead if Congress acts.

On Thursday, Christie conditionally vetoed a bill to legalize online gambling, asking the Legislature to increase the tax on online gaming revenue to 15 percent, and to include a 10-year sunset provision. Christie also asked for other changes, but the decision was widely praised, and leading lawmakers have said they will act quickly to update the bill.

Top advocates of the plan already are looking toward the next steps in New Jersey. Bill Pascrell III, a lobbyist with Princeton Public Affairs Group, said the state could also be ready to take bets online as soon as September, noting that gaming regulators have been working on guidelines long before Thursday’s decision.

Assuming swift adoption of Christie’s changes, Pascrell also touted the jobs and real estate impact, especially as it ties to the Atlantic Club. Christie’s decision solidified a pending sale of the casino to one of the world’s top Internet poker operators, saving 2,000 jobs there and paving the way for it to set up the required infrastructure.

“The Atlantic Club has already scouted out where they’re going to put their servers, and they’re ready to go,” Pascrell said, noting that the company was only waiting for the state to act. “It will have a very positive real estate impact because these server farms take up a lot of space.”

As for the prospects for interstate gaming, DiGiacomo said leaders from the American Gaming Association were “not optimistic about a federal solution this year.” He pointed to other pressing issues like the economy, immigration and gun control.

But Pascrell said he was optimistic that action would eventually come.

“I believe that within a couple of years, the federal government is going to wake up and realize they’re missing a wonderful opportunity to regulate and get tax revenue from Internet gaming, because it’s going to see how New Jersey and some other states that are following suit will be able to take advantage of this,” he said.

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Joshua Burd

Joshua Burd

Josh Burd covers real estate, economic development and sports and entertainment. Before joining NJBIZ in 2011, he spent four years as a metro reporter in Central Jersey. His email is joshb@njbiz.com and he is @JoshBurdNJ on Twitter.

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