Online gambling legalization bill passes state Senate on a positive 29-5 vote
Media in the US state of New Jersey reported late Monday that S490, a bill legalising online gaming within the state, was among several to pass the state Senate only weeks after cruising through committee stage.
The bill passed on a 29 to 5 vote Monday, opening up the possibility of intrastate internet gambling on poker and casino games, with a further resolution to ask voters in 2011 whether to legalise sports betting should a federal ban be judicially overturned.
New Jersey is now on track to become the first US state to allow — and tax — an intrastate online gaming system, and in doing so, could test the federal government’s restrictions on online gambling, opines the Press of Atlantic City publication.
Although US federal law prevents wagering across state lines, S490 allows a system for only state residents — and foreign gamblers — to place bets online.
Sponsored and fought through the legislative process by Democrat state Senator Raymond Lesniak, the bill was amended to allow residents of other countries, but not other U.S. states, to gamble via proposed online gaming websites operated on servers based in Atlantic City.
The bill now goes to the state House of Assemby for further committee consideration.
Online casino operators will be able to apply for a one-year renewable licence. Licenses for online gaming would cost operators $200,000 the first year and $100,000 to renew. Operators will likely be taxed 15 percent, lower than the originally envisaged 20 percent. A percentage of the proceeds will go toward helping the state's battling horseracing industry, reducing the need for government subsidies.
Lawmakers are confident that technology exists to prevent out-of-state players from gaining access to New Jersey’s system.
A pleased Senator Lesniak told reporters following the vote that all computer servers, equipment and other support services and companies for the online gaming industry would by law have to be located in Atlantic City.
“That’s a no-brainer, and the whole bill is a no-brainer,” Lesniak said. “We need to be bold, to tell the federal government it has no constitutional authority to prevent online gaming here in our state."
Lesniak also noted that provision existed for the state Department of Human Services to run compulsive gambling treatment and prevention programs, which would be funded by licensees at a cost of $100,000 per year.
Another key bill in the liberalisation of New Jersey gambling was also passed out of a Senate committee Monday in the form of a measure that will ask the state's voters whether New Jersey should allow betting on sports events. The bill was approved 6-1 by the Senate Economic Growth Committee, allowing it to receive future consideration by the full Senate.
If approved by voters, a constitutional amendment would authorize the Legislature to enact laws allowing betting at casinos in Atlantic City and at racetracks, including former racetracks, on sports or athletic events.
Lesniak, the measure’s sponsor, read statements into the record from racing and casino operators in Delaware, illustrating that allowing sports betting had boosted profits there. The resolution calls for a referendum to be held in November 2011 in which voters would decide whether to allow gambling on professional sports games. But a federal ban on sports betting in all but four states would have to be overturned first.
The Press of Atlantic City reports that Senator Lesniak is currently suing the federal government to overturn a ban on sports betting on constitutional grounds, mainly that it fails to treat all states equally. New Jersey was offered a chance to allow sports betting in 1991 but the government at that time declined.