January 19, 2010

New Jersey introduces first intrastate gambling bill

The state of New Jersey has introduced the first intrastate gambling bill in the US, potentially leading the way to the opening of the US egaming market on a state-by-state basis.

The S3167 Senate Bill bill introduced by Senator Raymond Lesniak (D-Union) would enable the state’s Atlantic City casinos to offer online version of their games including poker, blackjack and baccarat. The intrastate system would be regulated by the New Jersey Casino Control Commission, which would establish a new division to oversee operations and licensing.

Casinos holding permits would pay an initial up-front licensing fee of US$200,000, with the yearly renewal to be at least US$100,000. They would also be required to pay US$100,000 non-refundable deposit and a US$100,000 annual fee to be put towards dealing with compulsive gambling.

Permit holders would pay tax of 20% on internet wagering gross revenue, with a portion of these tax revenues channeled to the New Jersey Racing Commission “to be used for the benefit of the horse racing, including but not limited to the augmentation of purses.”

The act would take effect immediately upon new Republican New Jersey Governor Chris Christie signing it into law. Christie will take office tomorrow, Tuesday 19 January.

Previous Democratic incumbent Jon Corzine was supportive of measures to expand gambling provision in the state, last year joining a successful challenge to a federal ban on state-regulated sports betting. Christie’s position on Lesniak’s bill is as yet unclear.

The Interactive Media Entertainment and Gaming Association (iMEGA) was a plaintiff in last year’s suit with Corzine to join a challenge to the federal ban on state-regulated sports betting, and worked with NJ legislators on the new intrastate bill.

iMEGA chairman Joe Brennan said: “New Jersey is recognised as having the toughest gaming regulators in the US, but as a leading gaming state with a long track record of doing things the right way, internet gambling will have a great home here and the opportunity to begin normalising the industry.”

Brennan added that although iMEGA remained supportive of federal efforts to legalise interstate gambling in the US, especially by Congressman Barney Frank and Senator Robert Menendez, he said these efforts “had stalled.”

Brennan said: “If states assert their right to regulate gambling and take a serious look at permitting Internet gambling within their borders, one side effect may be a breaking of the deadlock in the US Congress.”

California and Florida are among the states currently considering authorising intrastate poker as allowed under the Unlawful Internet Gambling Enforcement Act 2006.

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