Legalized Sports Betting in New Jersey?

 

Introduction

Last week I had the opportunity to attend the East Coast Gaming Congress and NexGen Gaming Forum at Harrah’s Resort in Atlantic City. So, this week, as a departure from my usual columns describing various NJ online casino promotions, the focus will be on some timely topics discussed at the conference that are also of great interest to New Jersey gamblers. The first in this series of articles relates to the progress, or more precisely, lack thereof, towards finally offering legalized sports betting in New Jersey.

President Trump Favors Legalized Sports Betting

Whether you like or dislike the way President Trump is running our country and agree or disagree with most of his policies, gamblers have to be glad that he favors legalized sports betting. In fact, in 1993, when Trump was still a larger than life presence in Atlantic City, when asked the question whether he was in favor of legalized sports betting, Trump responded:

“You have to be. It is vital to keeping your taxes lower, it’s vital to the senior citizens and it’s vital to putting bookies out of business.”

Of course, in many instances, people in the public eye, and politicians and aspiring politicians especially, have been known to change their mind, but on this issue, Trump has not wavered. In 2015 he said:

“’I’m OK with {legalized sports betting and daily fantasy sports} because it’s happening anyway whether you have {legalized sports betting} or don’t have it.”

How Other Politicians and the Public Weigh In On Legalized Sports Betting

An interesting feature of the sports betting issue is that people from all walks of life and people of all political orientations share the same sentiment. As mentioned at the East Coast Gaming Congress, 55% of the American public supports regulated sports betting.

Of course, one of the main reasons why many politicians in New Jersey and other states also want to see sports betting legalized is the substantial additional tax revenue it can provide. The added revenue would go a long way towards alleviating existing budget shortfalls for important state funded programs.

Relevant History: PASPA

At the present time, all forms of sports betting remain illegal in all but four of the 50 states: Nevada, Delaware, Montana, and Oregon. The reason is a law enacted in 1992 called the Professional and Amateur Sports Protection Act (PASPA). Under the provisions of PASPA, all sports betting in the US. was banned except in those states where it was already legal or in municipalities which qualified for exemption from PASPA on other grounds.

Atlantic City, which met the criteria of offering legal casino gambling for at least 10 years prior to the enactment of PASPA, lost its opportunity to be exempt from PASPA. The reason was that the deadline to have a referendum on the ballet in the upcoming November election was missed. It should also be mentioned that with the exception of Nevada, the types of sports bets that are permitted in the other three exempt states are very limited.

At the time PASPA went into effect, all four major professional leagues—the NFL, MLB, NBA, and NHL, as well as the NCAA–supported the measure fully. It was believed that PASPA would not only halt the spread of state-sanctioned sports betting, but also ensure the integrity of professional and collegiate sports. In addition, advocates were confident that PASCA would limit teenagers’ and other at risk groups’ exposure to sports betting.

Twenty-five years later, however, it is clear that PASPA has failed to meet its goals. According to the American Gaming Association, a conservative estimate of $16 billion is currently being wagered on sports, with $4.7 billion spent on Super Bowl bets alone. About 97% of this gambling activity is illegal. Clearly, much like the Prohibition didn’t stop people from drinking, PASA has not deterred those who wish to bet on sports from doing so illegally.

Courts’ Response to Actions Taken in New Jersey

Meanwhile, New Jersey, second in the U.S., only to Nevada in casino gambling and No. 1 in online gambling, has been at the forefront of the movement to get the existing legislation overturned. In 2011, NJ voters approved a bill to allow the state’s casinos and racetracks to offer legalized sports betting. But the following year, after Governor Christie signed the bill into law, the sports leagues filed a lawsuit claiming violation of PASPA. Then, after both the District Court and Court of Appeals sided with the leagues, the Supreme Court refused to hear the case, so the bill was essentially dead.

Subsequently, New Jersey legislators tried again with a revised bill known as the Sports Wagering Act of 2014. Additional provisions included limiting sports wagering to those 21 and over and not allowing wagering on events involving New Jersey colleges. However, the results were the same. Governor Christie signed the bill, but the leagues intervened and both lower courts sided with the leagues. The only difference was that this time New Jersey was given the option to pursue the matter in Supreme Court.

New Developments

On May 24, 2017, Acting Solicitor General Jeffrey Wall dealt what could be another devastating blow, and what some experts believe to be the final nail in the coffin, with regard to New Jersey’s long-standing court battle. According to Solicitor General Wall, New Jersey failed to demonstrate that there were valid constitutional problems with PASPA justifying the Supreme Court’s involvement.

Experts believe, however, that there is still a chance that the Supreme Court will ignore the Solicitor General’s recommendation and consider what New Jersey has to say anyway. Or, alternatively, and the Solicitor General acknowledged this, New Jersey could go further and repeal all state legislation prohibiting sports gambling, thereby decriminalizing the act in any venue, not just casinos and racetracks.

A full repeal would likely so enrage the professional sports leagues that they would be forced to revise their current stance on the matter. They could request new federal legislation whereby sports betting would be allowed under certain specified conditions. Meanwhile, the American Gaming Association is stepping up its own efforts to get the Trump Administration and Congress to take action, emphasizing the obvious benefits to the state  if sports betting is regulated and taxed.

By June 26, the Supreme Court is expected to decide whether or not it will hear New Jersey’s appeal. However, this time, if it refuses, New Jersey may indeed resort to the more drastic step of repealing all of its state gambling laws.

Is Legalized Sports Betting in New Jersey’s Future?

Depending on whom you ask this question, you will get a wide range of answers. Some experts believe that New Jersey should concede defeat and abandon further efforts. Others believe that despite running into a brick wall in the courts, everything is now aligned to have the current ban on sports betting lifted, though when that is likely to happen is up for debate.

Dennis Drazen, legal counsel to the New Jersey racetracks that want to add sports books, estimates five years. He thinks it will take that long because the matter is currently not high on Congress’ priority list.

On the other hand, Geoff Freeman, President and CEO of the American Gaming Association, is much more optimistic. Speaking at the East Coast Gaming Congress, Freeman shared his sentiments on the matter. He mentioned the fact that the NFL is already embracing fantasy sports as a positive sign that the league is also starting to come around insofar as traditional sports betting is concerned. In addition, both an NFL team (the Raiders) and an NHL team (the Golden Knights) are coming to Las Vegas.

Freeman believes that even in the likely event that the Supreme Court does not overturn the lower court rulings, the future for legalized sports betting in New Jersey and other states that want it looks bright. He further indicated that “everything is trending right,” but what needs to be done before the end of 2017 is to create a diverse coalition whose members can work together to formulate a viable legislative proposal. People in law enforcement, broadcasting, and state and federal legislators need to get together with experts in gambling law in order to come up with a proposal to which all affected parties can agree.

The goal thereafter would be to introduce the new bill in 2018 and by 2019 have legalized sports betting a reality. However, Freeman also cautions that in order to achieve these goals “we need to capitalize on the opportunity.”

 

 

Barbara Nathan
Barbara Nathan is both a professional writer and casino, poker, and sports betting expert. Originally from NYC, she relocated to Absecon, NJ in 2013 just prior to the official launch of New Jersey regulated online casino and poker gambling. Besides keeping tabs on important developments in the industry from day 1, Barbara is very familiar with what each NJ online casino has to offer. Her comprehensive, unbiased reviews and promotion descriptions provide a valuable service to NJ online casino players. Barbara also enjoys volunteering in the Atlantic City community. She is a certified literacy tutor at the Atlantic City Public Library.

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