New Jersey gaming bill faces crucial hearing
Bill S1565 will go in front of Senate Budget and Appropriations Committee later today in bid to push it through to a full vote last this month - horse racing associations expected to table opposition.
A hearing in the New Jersey Senate today is expected to put Raymond Lesniak’s egaming bill in a position for the legislature to vote it through later this month, the Senator has told eGaming Review, but it faces stiff opposition from horseracing bodies that will testify against its passage.
The Senate Budget and Appropriations Committee meeting, scheduled for 11am Eastern time (4pm GMT), will hear details of the amended bill and several testimonies from Senator Lesniak, representatives from elderly and disabled organisations that stand to benefit from additional state funding if the bill passes, as well as horse racing bodies and track owners.
However, according to a source close to the matter owners of the Meadowlands horse track and the Thoroughbred Breeders’ Association of New Jersey are expected to testify against proposals to allow legal intrastate gaming to open in its current form. The original bill included a clause that would have provided the US$1bn state horse racing industry to gain purse subsidies from revenues generated by intrastate internet gaming, however this was removed earlier this year due, it is thought, to Governor Chris Christie’s insistence that the horse organisations “stand on its own two feet”, the source said.
In an exclusive interview with eGR last March Lesniak said he expected to face opposition, and a possible lawsuit, from horseracing groups, admitting that the state’s horse tracks were “legitimately upset” about the decision to remove the clause. However, he added that he hoped to “talk them off that ledge” before any legal action, that has the potential to derail its bid to become to become the first state to offer egaming, is taken.
“I’m a big supporter of the horse racing industry and they have legitimate needs we need to address,” he said. “I certainly I hope I might be able to at least sooth some of their concerns. They’re both vital industries and I’m hopeful we can get the horse racing industry to understand that the best course is to work with us, rather than against us.”
The source added that the horseracing organisations would protest later today because under current proposals they would not, unlike other states, be granted a licence to operate any form of gaming or horse track slots. “Their testimonies will suggest they are an industry in dire need but they will just alienate themselves by doing that,” the source suggested.
Lesniak is thought to have the backing of a number of elderly and disabled groups that stand to benefit from tax revenues generated by any form of online gaming. An economic development study released in February last year by the Interactive Media Entertainment and Gaming Association (iMEGA) on the economic and fiscal impact of the proposed egaming legislation found that the opening of a regulated market there would create up to 57,000 new “long-term” jobs contributing to a potential $7bn in gross egaming yield, and provide an estimated $472m in total New Jersey tax revenues for the state, much of which would be passed onto assist with care for the elderly and disabled citizens.
Once all the testimonies have been heard, Senate President Paul Sarlo will ask the 13-member Committee to vote on the bill. A majority vote would secure its legislative passage. If successful bill S1565, co-sponsored by Lesniak and fellow Democrat Jim Whelan, authorising “internet wagering” including poker and casino games via the state’s 12 Atlantic City-based casinos, will then pass to a further Senate hearing and floor vote later this month or at the beginning of May, according to sources close to the matter.
Last month Lesniak said he was confident his bill, that has so far taken three years to get to this stage, would gain a majority passage through both the Senate and Assembly by 15 March, however the recent appointment of Ruben Ramos to the chairmanship of the influential Regulatory and Oversight Gaming Committee, stalled its progress with the up-and-coming politician faced with a controversial piece of legislation to pass in his most senior post yet.
Should S1565 progress thorough both houses Lesniak said he is equally confident he will get the Governor signature without the need for a referendum after gaining his full support to allow the state to become the “blueprint” for internet gaming in the United States.
Governor Christie originally vetoed Lesniak’s egaming bill in March last year due to concerns, among others, that it had the potential to expand gambling outside of Atlantic City in breach of the state constitution, however Lesniak told eGR that the Governor has now been “convinced” following talks with the Senator and after seeking expert legal advice.
“The Governor has been convinced, as I was last time I put it through, that our constitution does not require it, that it’s an already existing form of gaming approved under our constitution and this is not a new form of gaming but a new vehicle as to how to place a bet,” Lesniak told eGR last month.
“Governor Christie has received an opinion from a constitutional law authority that agrees with my legal opinion, plus now that other states are rushing to the forefront to take the lead on this it has created a sense of urgency that wasn’t there in the past and that would be jeopardised by waiting until November which we would have to do to get an amended constitution. Those two things combined, and the support of the casino industry in New Jersey, other than Caesars, all came together to get this going now and to get the Governor to support it as is,” he said.