Friday, January 06, 2012

New Jersey to Join the Online Gambling Race?

Welcome to New JerseyI remember arriving in Atlantic City last spring to help cover the WSOP-Circuit event there. Just a few days before I got there, New Jersey governor Chris Christie had vetoed a bill that would have allowed for instrastate online gambling via websites run by AC casinos, and there was still a bit of buzz going around about the news.

Had the bill made it past Christie’s desk, New Jersey would have been the first state to pass such a bill. As it happened, Nevada would gain that distinction a few months later when it passed A.B. 258.

At the time, Christie had said he had “significant concerns” with the proposed bill, including uncertainty about whether it satisfied certain requirements in the state’s constitution. Christie also noted at the time that many New Jersey residents were in fact opposed to the state offering online gambling -- polls then indicated they were about 2-to-1 against -- and thus wasn’t sure if the bill reflected “the public’s sentiment.”

There were no references to federal laws in the message accompanying Christie’s veto. That is to say, he mentioned nothing then about the Wire Act, the Unlawful Internet Gambling Enforcement Act, or other federal laws that might have raised concern for a state wishing to pass a bill such as the one he’d chosen to veto.

There was talk even then about the value of getting out ahead of this issue -- i.e., for New Jersey to be first in line when it came to passing such legislation and thus getting the infrastructure together to start offering online gambling before other states could. But Christie weighed the risk against the potential reward and decided folding the better option.

Cut to the first week of 2012. As the previous year was coming to a close, a revised opinion from the Department of Justice regarding the Wire Act and its applicability to non-sports betting was made public, seemingly removing a possible obstacle to states setting up their own online gambling sites.

Nevada, having passed its online gambling bill six months before, has approved regulations for licensing companies to offer online gambling, and many have already applied. Approvals of those applications are expected to come in April.

And now, after playing it safe for several months, New Jersey appears ready to play.

State senator Raymond Lesniak had reintroduced the a new version of the bill in August with revisions responding to some of Christie's concerns about it opening the door for more than just AC casino-run websites. As the new year began, Lesniak again attempted to get the bill (S-3019) considered before the current legislative session ends next Monday, although it doesn’t appear that is going to happen.

However, it does look like the bill could well come up for a vote and could possibly be passed during the first part of the next session (i.e., within a couple of weeks). This week Lesniak met with the governor and came away confident that Christie is likely on board with the new bill. “I expect that we can get it through the Legislature and signed by the Governor within the first few weeks of the new session,” said Lesniak in a statement issued on Wednesday.

I haven’t examined the previous New Jersey bill (that Christie vetoed), nor the revised one that sounds like it may pass, so I don’t know the specifics of how it was changed to assuage the governor’s concerns. In any case, it seems clear that the DOJ’s new stance has ignited something here, even if Christie hadn’t mentioned anything about federal laws regarding online gambling last spring when vetoing the earlier bill.

Meanwhile, several other states are starting to talk in similarly serious ways about offering online gambling in the wake of that revised DOJ opinion. As Mike Sexton would say, it looks like we have ourselves a race situation, Vince.

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