New Jersey Gov. Jon Corzine last week announced that he will join a law suit that, if successful, would allow for legalized sports betting in the state and potentially raise $100 million of annual tax revenue.
Sen. Raymond Lesniak, D-Union, in late March filed suit in U.S. District Court to overturn a federal ban on sports wagering. Neighboring Delaware is one of four states exempt from the federal restriction. The state’s horse racing facilities in the fall will begin taking legal and regulated sports bets after Gov. Jack Markell last month signed into law a bill allowing such wagering.
Corzine said Delaware’s new betting law could hurt tourism and gaming in Atlantic City.
“Delaware’s entry into sports wagering and table games is a serious threat to the both the casino and horse racing industries in New Jersey,” Corzine said in a press release. “We must do everything in our power to stay competitive. We simply cannot afford to sit back and let neighboring states press an unfair advantage against us anytime, and certainly not in the midst of this global economic crisis.”
New Jersey’s casinos recently got additional competition from casinos that opened this spring in neighboring Pennsylvania.
New Jersey officials estimate that legalizing sport betting would generate $10 billion per year in activity, with the state gaining $100 million in tax revenue annually. If the court overturns the federal ban, Garden State residents would then vote on the issue.
Lesniak said the U.S. Department of Justice must file its response by July 27. He doesn’t anticipate a court hearing on the issue before the fall.
“Back in 1992, the Justice Department expressed serious concerns that this federal ban violated the Tenth Amendment to the U.S. Constitution, that it violated states’ rights,” Lesniak said.
Additional revenue would help New Jersey which closed a $4.4 billion budget deficit in fiscal 2009, which ends June 30, and is currently addressing a $9 billion shortfall for fiscal 2010.
Delaware is the second state in the U.S. to legalize sports wagering, after Nevada. Oregon and Montana are also exempt from the federal ban, but do not permit legalized sports betting.
