By Lynne Levin Kaufman, Esquire
For those of you who have been asleep for the past 24 hours, yesterday the Supreme Court declared the federal Professional and Amateur Sports Protection Act of 1992 (PASPA) unconstitutional and gave states the ability to decide whether or not to legalize sports wagering, and to craft, through legislation and regulation, a sports betting framework in their state.
Those of us that were not asleep declared yesterday a day to celebrate a great victory for the State of New Jersey and for the entire gaming industry. Tourism, jobs, tax revenue, and new entertainment are just a few reasons why. It was of course, a day for much speculation about the impact of sports wagering, including the question, which state will be up and running soon?
Yes, legislation has been passed in Connecticut, Mississippi, New York, Pennsylvania and West Virginia in anticipation of the ruling. Yes, although New Jersey started and won the battle against PASPA, its sports betting legislation has not been enacted yet.
However, don’t place your bets against New Jersey coming out in front. New Jersey has fought for many years to overturn PASPA, against powerful and formidable opponents, and it is not going to take any time for a victory lap until sports wagering is legalized and operating in New Jersey. Although a few other states may be a bit ahead in the legislative process, we believe that gap will quickly close. Why?
Legislation had already been proposed in the Assembly, and within a few hours after the Supreme Court decision was released, the Senate introduced its own legislation. All proposals tie legalized sports wagering to the landbased casino and racetrack industries, and have a lower tax rate than that proposed in some neighboring jurisdictions, making it more welcoming for operators to enter the New Jersey market. The New Jersey Division of Gaming Enforcement has also been preparing for years, and will be ready with regulations to support any legislation.
Furthermore, in addition to the fact that we anticipate the legislative and regulatory process to move quickly, New Jersey is one of only three states in the country with operating regulated internet gaming (with the other two being Nevada and Delaware). Thus, New Jersey has technical and practical experience from its successful launch of internet gaming that can be applied to internet sports wagering. This experience ranges from software product approvals to successful geolocation and age and identity verification measures, to name just a few critical areas. States without live regulated internet gaming do not have this technical or practical experience. Of course, as the second state in the nation to legalize casino gaming, there is the well established and respected landbased casino infrastructure in place as well. Last, and not at all the least – in fact maybe even likely to come in as first to operate – are the New Jersey racetracks, which have been prepared to offer sports wagering for years.
So stay tuned. We will continue to report. And here goes the lawyer disclaimer: Don’t really make that bet for or against any state going to market first. The decision yesterday did not legalize that activity!