New Jersey Governor Vetoes Online Gambling Bill

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For the second time in two years the New Jersey governor, Chris Christie, has vetoed a bill seeking to legalize intrastate online gambling passed by both the state Senate and House. Earlier it was a complete veto. This time around it appears to be a conditional veto. Though this is not as bad, the governor’s decision has come as big disappointment for those legislators who worked hard on the bill and for those New Jersey residents who were hoping to shortly start gambling from the comfort of their homes.

This outcome was not wholly unexpected. There were reports all over online gambling forums that Governor Christie would wait till the last day and then conditionally reject the bill. The governor has said that he would sign the bill if it had a 10-year time limit and a higher tax rate on online casinos. While it is not clear as to what the 10-year time limit means, the governor wants the tax on online winnings to be raised from 10% to 15%. Christie issued a statement averring his support to online gambling. He said that the time was right for New Jersey to lead the country by becoming one of the first states to permit online gambling. He stressed the stature of Atlantic City casinos in the land gambling industry, but pointed out that the revenue has been declining. Atlantic City land casinos had contributed $5.2 billion to the state exchequer in 2006. The revenue had fallen to $3 billion last year. Christie said that reversing this trend had been a priority for his administration right from the start. However, it is difficult to reconcile this statement with his repeated vetoing of the online gambling bill.

When the bill was vetoed the first time in 2011, Senator Raymond Lesniak could have challenged the veto. But he chose to rework the bill to include the governor’s recommendations. He piloted the 2012 version of the bill through the state Legislature with a good majority and presented it to the governor. Again Lesniak has adopted a conciliatory approach. Because the veto is conditional, the legislators need not sponsor a new bill this time. They can simply amend the existing bill to accommodate the governor’s recommendations and re-submit it after getting the amendments passed. Lesniak said that he was encouraged by Christie’s comments and would quickly incorporate the required changes. It is early days and no time limit has been indicated. There will be greater clarity on the issue in the coming week.

Online gambling also suffered a setback in Mississippi when Representative Bobby Moak’s bill to legalize online gambling failed at the committee stage. Moak had sponsored a similar bill last year, which had also failed in the committee.

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