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Trouble Ahead?

New Jersey online gaming bill stirs politics

Trouble Ahead?

The bill to legalize online gaming in New Jersey moved closer to realization last month as a state Assembly committee approved a bill very similar to one passed by a Senate panel in April. The bill approves online gaming within the state borders with the possibility of accepting out-of-state wagers if the state’s Division of Gaming Enforcement certifies that it does not violate federal laws.

A Justice Department memo released in December said any online wagering is legal within the boundaries of a state, except for sports betting.

A similar bill was passed in 2010 and was vetoed by Governor Chris Christie, citing constitutional concerns, as well as legal issues. The Justice Department memo cleared up some of those problems for the former U.S. attorney, but there are still some questions about where Christie stands on the bill.

One of the problems Christie cited was the clause that required the servers be based in Atlantic City, which is the only constitutionally proscribed venue for casino gambling in the state. Christie insisted that the gambling was taking place at the device rather than on the servers, so a constitutional amendment was required. That definition remains in the current bill.

The bill’s sponsor, Senator Ray Lesniak, says constitutional scholars have backed the interpretation of gambling taking place on the servers.

Nonetheless, there is a chance that Christie could side with supporters of the bill. Caesars Entertainment, which opposed the previous bill, hoping that a federal bill would pass in the meantime, is now backing the new bill. And state officials seem to realize that time is of the essence in the race to legalize online gaming.

The racing industry is opposing the bill because it has been cut out of the loop, unlike the previous vetoed bill. Ralph Caputo, a North Jersey assemblyman who supports a casino at the Meadowlands Racetrack outside of New York City, said it was “hypocritical” of the state to approve expanded gaming for the Atlantic City industry without allowing casinos elsewhere in the state. He wants to see a vote on both online gaming and casinos at racetracks in November.

“I don’t know what anybody is afraid of,” Caputo said. “Let’s let the people decide.”

Meanwhile, Lesniak has accused Christie of back-pedaling on his support of bringing sports betting and internet wagering to the Garden State. The North Jersey senator has accused the governor’s office of holding up their implementation due to political reasons.

Lesniak wrote in an email last week, “Christie is putting the future of A.C. in jeopardy because of his overriding concern for support from (Sheldon) Adelson, a right-wing money machine of Newt Gingrich and right-wing causes; Caesars, a huge contributor based in Nevada; and Woody Johnson, Jets owner and NFL opponent of sports gaming.”

The accusation came shortly after Lesniak and fellow state Senator James Whelan met with members of Christie’s policy and legal staffs.

According to both senators, the governor’s team relayed that Christie was holding off on his support.