Christie signs bill legalizing online gambling

Dimakis Kalogerakos playing a slot machine at Harrah's Resort on Friday. He says Internet gambling will help, but not save, Atlantic City.
Dimakis Kalogerakos playing a slot machine at Harrah's Resort on Friday. He says Internet gambling will help, but not save, Atlantic City. (SUZETTE PARMLEY / Staff)
Posted: February 28, 2013

Atlantic City's gambling houses can now begin offering betting on Internet versions of the slot machines and table games found on their traditional casino floors. The New Jersey Assembly and Senate overwhelmingly approved Internet-gaming legislation Tuesday, and Gov. Christie signed it into law.

New Jersey joins Nevada and Delaware as the only states in the country in which some form of online wagering is legal.

"I am pleased to say that today I signed New Jersey's Internet gaming bill, opening the way for new opportunity to bolster our efforts to continue the revival of Atlantic City, its casinos, and entertainment offerings," Christie said in a statement just after 5:30 p.m. "This was a critical decision, and one that I did not make lightly.

"But with the proper regulatory framework and safeguards that I insisted on including in the bill, I am confident that we are offering a responsible, yet exciting option that will make Atlantic City more competitive while also bringing financial benefits to New Jersey as a whole."

The Republican governor conditionally vetoed the bill Feb. 7, as he sought revisions to ensure that Internet gaming would be properly regulated. He wanted I-gaming subject to a 10-year trial period, with an annual review; state elected officials to disclose any past and present dealings with entities seeking or holding Internet-gaming licenses; more resources devoted to problem-gambling programs; and the tax on gross online-gaming revenue boosted to 15 percent from 10 percent, resulting in a bigger state cut.

All the changes were incorporated into the bill, and the measure sailed through both houses (68-5-1 in the Assembly, 35-1 in the Senate) in Trenton before Christie's scheduled 3 p.m. state budget address to a joint session of the Legislature.

"This is the ultimate form of convenience gaming," said John Burzichelli (D., Gloucester), the legislation's prime sponsor in the Assembly, after the vote there. "Atlantic City will pick up some of what is being done illegally now. . . . The resort will be able to renew some relationships [with customers] that have drifted away."

Internet gambling "will provide a new gaming option for New Jersey residents who don't have easy access to Atlantic City casinos," analyst Andrew Zarnett of Deutsche Bank A.G. said in a report Tuesday.

Under the state Constitution, Atlantic City has exclusivity on gambling, which is why the servers for online gaming must be housed at the 12 Shore casinos, Burzichelli said.

A patron can gamble online anytime as long as he or she is within the state's borders with a laptop, iPhone, iPad, or other handheld device. For instance, a Philadelphian visiting Meadowlands Stadium in East Rutherford or waiting for a plane at Newark Airport will be permitted to wager online.

Here's how it works, said Pepper Hamilton L.L.P. online-gambling attorney Jeremy Frey: Log on to a website operated and owned by any of the Atlantic City casinos. You can begin play once you pass the security protocols to confirm your age (21 or older), casino account, and other information, and GPS technology confirms that you are located in New Jersey at the time you are gambling.

"Internet gaming is a great thing," Dimakis Kalogerakos, 44, a small-business owner from Margate City, said as he worked a penny slot machine at Harrah's Resort in Atlantic City on Friday. "It will boost revenue . . . but it will not save Atlantic City from its downturn. It will help. It's another avenue, just like sports betting [now in federal court] will be a good option."

Last week, the Borgata Hotel Casino & Spa became the first casino in the United States to offer in-room gambling from a TV remote control, and the other Atlantic City casinos also have been preparing for Internet gaming.

Supporters say I-gaming can raise an additional $250 million to $300 million in annual revenue for the struggling resort, which has lost substantial brick-and-mortar casino revenue to Pennsylvania and New York during the last six years.

Nevada became the first state to legalize intrastate online poker last summer.

Delaware legalized online wagering at its three racetrack casinos in late June but has yet to launch it. In January, the state issued a 150-page request for proposals for vendors to supply the technology, software, support staff, marketing, and payment method, and it hopes to have online gambling up and running by Sept. 30, said Secretary of Finance Tom Cook.

Like Delaware, New Jersey will need to install GPS tracking software to tell whether a patron is gambling online in the state. Such software can identify the source of a signal within a few feet.

The new law also allows New Jersey to enter into interstate compacts to broaden the player pool for online poker tournaments with Nevada and Delaware, and other states that move to legalize the activity. On Friday, California introduced legislation for online poker.

Democratic State Sen. Jim Whelan, whose district includes Atlantic City, said the addition of online wagering will prevent at least one casino from closing - tiny Atlantic Club Casino Hotel, which is being bought by an online-gaming company. The financially ailing casino's employees and management lobbied hard for Christie to legalize Internet gaming, with closure possible if he did not.

"This saves 3,000-plus jobs in Atlantic City in the short term," Whelan said. "Long term, New Jersey is now positioned to be at the forefront of a national phenomenon."

Ryan Kaufman, 29, a defense attorney from New York City who plays online poker, said it would benefit the Shore resort, where he stayed last weekend.

"Definitely, it's a good thing," he said. "It's another way to bring people to Atlantic City."


Contact Suzette Parmley at 215-854-2855 or sparmley@phillynews.com.

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