Senate Bill 3536 Introduced into NJ Legislature

Posted on Apr 11, 2018 10:18 AM EDT
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Senate bill 3536 was introduced by Sen. Raymond J. Lesniak on Thursday, 30 November 2017. The bill makes provision for online gambling equipment to be located outside Atlantic City for specific international purposes. The bill was introduced as a means of combating illegal online gambling through regulated enforcement procedures. By introducing oversight into online gambling activity, the state of New Jersey believes that it can provide the necessary protections to players and generate revenues from online gaming activity.

The bill refers to $15 billion per year in online gambling revenues being generated from European markets. Additionally, Sen. Raymond J. Lesniak attests to the economic benefits derived by Atlantic City and the state of New Jersey through online gambling activity. According to reports, some 3,000 jobs have been created, $998 million in economic output generated, and employee wages to the tune of $219 million. The state has collected $84 million from real money online gambling revenue alone, and $124 million to tax revenues. The most critical component of the new bill is the following:

'...the division may permit Internet gaming equipment to be located outside of the territorial boundaries of Atlantic City if the division deems it necessary to facilitate the conduct of international wagering permitted under this section' (cf.: P. L. 2013, see. 27, s. 29)

If passed, this legislation has far-reaching implications for the state of New Jersey. It would effectively allow the Garden State to team up with international jurisdictions such as the United Kingdom Gambling Commission, the Malta Gambling Authority, the Government of Gibraltar, or other authorities and provide online gambling services. Presently, New Jersey gambling law expressly states that the online gambling servers must be located in Atlantic City. The DGE director, David Rebuck indicated that New Jersey regulators are not satisfied with gambling servers being limit to Atlantic City.

One Last Hurrah for Sen. Raymond J Lesniak

Sen. Raymond J. Lesniak attempted to displace Gov. Chris Christie from his position, but failed. This has been cited as the reason for Senate Bill 3536 being delayed until December. The introduction of the bill and its passage through the New Jersey state legislature will have to be fast. Sen. Lesniak will be retiring at the end of four decades of civil service. With time of the essence, SB 3536 will only have until January 9, 2018 before it is dead in the water. Lesniak has long been a faithful supporter of regulated gambling and expanded gambling in the state of New Jersey. His efforts have included numerous initiatives to promote sports betting and online gambling in New Jersey. The Democrat is the second longest running civil servant in Trenton New Jersey.

Is Sharing Online Poker Players with the United Kingdom a Good Idea for New Jersey?

The state of New Jersey has been actively campaigning to set up an international gaming compact with the United Kingdom. If this comes to fruition, it will continue to drive online gambling revenues for New Jersey. Year on year through October 31, 2017, NJs gross gambling revenue rose 26.7%. The United Kingdom is a special case for online gambling, given that it is one of the oldest and most developed markets for casino gaming. The introduced legislation is designed to make it possible for New Jersey players to play at UK-based online casinos, and poker rooms. According to Deloitte, the UK comprises 10% + of all European online gambling, with some 2 million+ active gamblers in the UK.

Sen. Lesniak is one of the chief architects of New Jersey's online gambling law. Among the many challenges facing lawmakers is the prevention of underage gambling across international boundaries. Allied with that are tax-related concerns such as collection of tax revenues abroad especially with Britain in the midst of a complicated extrication process from the EU - Brexit. In the United Kingdom, online gambling operators are required to pay 15% tax on GGR. While online slots dominate the New Jersey iGaming arena, it is online poker which is struggling to gain traction. In 2017 alone, P2P win declined by 8%, and poker rooms are averaging less than 200 seats per week

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