Both branches of the state legislature passed the regulatory legislation on June 7. The final hurdle in a seven-year battle to legalize sports betting in the Garden State was obtaining the Governor’s signature. However, he originally set no timeline on signing the bill after it landed on his desk.
In fact, one day after lawmakers passed the legislation, Murphy would only say that sports betting is coming to New Jersey sooner rather than later. Gov. Murphy appeared to be in no rush to sign the bill. He said although he is not sitting on it, he would give the bill the same time and level of review he gives all legislation.
Four days after it passed, Gov. Murphy has now signed it. He said in a statement released Monday that sports betting in New Jersey is now a reality:
“Today, we’re finally making the dream of legalized sports betting a reality for New Jersey. I’m thrilled to sign Assembly Bill 4111 because it means that our casinos in Atlantic City and our racetracks throughout our state can attract new business and new fans, boosting their own long-term financial prospects. This is the right move for New Jersey and it will strengthen our economy.”
Sports betting at NJ racetracks and casinos
Under the legislation, all seven licensed casino in Atlantic City and the state’s three racetracks can accept wagers at sports wagering lounges on the property. They can also operate a temporary sports wagering facility during construction of a sports wagering lounge.
Additionally, licensed casinos and racetracks can start taking bets online beginning 30 days after the effective date of the bill.
The list of seven currently operating casinos located in Atlantic City are:
- Bally’s Atlantic City Hotel & Casino
- Borgata Hotel Casino & Spa
- Caesars Atlantic City Hotel & Casino
- Golden Nugget Atlantic City
- Harrah’s Resort Atlantic City
- Resorts Casino Hotel
- Tropicana Casino and Resort
Two more casinos, Ocean Resort Casino and Hard Rock Hotel & Casino Atlantic City, will open June 28 and have also been authorized to allow sports betting.
The state’s three racetracks are:
- Monmouth Park Racetrack in Oceanport
- Meadowlands Racetrack in East Rutherford
- Freehold Raceway in Freehold
A provision in the law also allows the former Atlantic City Race Course in Hamilton Township to offer sports betting, should the facility reopen.
Casino and sports franchise ownership concerns
New Jersey lawmakers designed parts of its sports betting legislation to ease concerns over sports betting operators with ownership stakes in professional sports teams.
Clauses were included that will allow MGM Resorts, Caesars Entertainment, and Golden Nugget properties to open sportsbooks, despite owners of these properties also holding ownership stakes in professional teams.
The law prohibits casino and racetrack operators who own a stake of 10 percent or more in a pro sports franchise from offering sports betting.
Private equity firm Apollo Capital Management was co-founded by the NBA’s Philadelphia 76ers and the NHL’s New Jersey Devils owner Joshua Harris. The company also owns a stake in Caesars Entertainment, although it is less than a 10 percent stake. Therefore, Caesars’ three Atlantic City casino properties have been authorized to open sportsbooks.
The law also allows casino and racetrack operators who own a stake in a pro sports team to allow sports betting provided the team is worth less than one percent of its business.
Borgata Hotel Casino & Spa owner MGM Resorts owns the WNBA’s Las Vegas Aces. However, it will be allowed to offer sports betting because the team is worth less than one percent of MGM Resorts.
Finally, a last-minute change to the law will also allow Golden Nugget Atlantic City to allow sports betting. Owner Tilman Fertitta is also the sole owner of the NBA’s Houston Rockets, having bought the team for $2.2 billion in 2017. Parent company Landry’s had revenues of approximately $3.4 billion in 2017.
That means the Rockets are worth more than one percent of Fertitta’s business and he owns more than 10 percent of the team.
However, the last-minute change to the law will allow Golden Nugget to take bets on all sports except NBA basketball. They are, however, clear to take bets on college basketball.
NJ sports betting regulations
Gamblers in New Jersey must be 21 or older in order to make a bet anywhere in the state.
The bill also includes language preventing athletes, coaches, referees, and any other persons with potential influence or inside information from betting on games.
Additionally, New Jersey sportsbooks are prohibited from taking bets on high school sports. Or collegiate athletics taking place in the state or involving New Jersey teams.
The law sets the tax rate for racetrack and casino sportsbook operations at 8.5 percent. Plus, an additional 1.25 percent payment. For racetracks, that payment will be split among the track’s host community and county. For casinos, the payment will go towards Atlantic City marketing efforts.
Additionally, the law sets the tax rate for online sportsbook operations at 13 percent.
Gov. Murphy’s statement estimates State tax revenues generated from sports betting in year one will be approximately $13 million.
The bill authorizes the state’s Division of Gaming Enforcement and New Jersey Racing Commission to issue emergency regulations to govern sports betting.
Sports betting licensing
The regulations will be in effect for a period of up to 270 days. The regulations will allow licensed casinos and racetracks to apply for a transactional waiver. This waiver will enable the properties to commence sports betting operations.
Once operations commence, New Jersey will become the third state in the country to offer full-scale sports wagering. Delaware was second behind Nevada, launching sports betting at its three racetrack casino properties June 5.
According to Murphy’s statement, the Racing Commission will hold a meeting to review racetrack sports betting regulations on June 13.
Following the Commission adopting regulations, Murphy says he will ratify the Commission’s decision. That will allow licensed racetracks to apply for the transactional waiver and begin accepting bets.
Monmouth Park at the ready
Monmouth Park is expected to be the first to accept a legal and regulated sports bet in NJ.
In 2013, British bookmaker William Hill, already Nevada’s largest sportsbook operator, inked a deal with Monmouth Park. The deal would allow it to become the racetrack’s exclusive sports betting provider. William Hill paid $1 million for the rights, agreeing to split all future sports betting revenue down the middle.
Monmouth Park used the money to renovate a cafeteria behind the grandstand, turning it into the William Hill Race & Sports Bar. The plan has always been to convert the sports bar into a full Las Vegas-style sportsbook.
Monmouth Park has been eager to launch sports betting on the property. A May 14 US Supreme Court decision declared the federal ban on sports betting unconstitutional. A decision that opened the door for all 50 states to join Nevada in legalizing single-game wagering. Monmouth Park has been eyeing several launch dates since that time.
Monmouth Park now tells Reuters news service it will take its first bet at 10:30 a.m. on Thursday, June 14.
William Hill has also promised it will build another $5 million sportsbook at the track with space for 5,000.