Opponents Of NY Online Casinos Have Unlikely Ally After NJ Fumbles Extension

Written By David Danzis on July 20, 2023
hudson river running by new york city

Proponents of online casinos in New York often point to their neighbors across the Hudson River as a prime example of what a regulated and taxed industry could bring to the Empire State.

New Jersey online casinos have been legal for a decade, during which time the industry has generated more than $1 billion in lifetime tax revenue. Atlantic City casinos benefit from an additional revenue stream and increased brand awareness with a younger demographic.

For almost 10 years, online gambling in NJ has been seen as a net positive.

But a recent legislative misstep may have cost NJ its favored status among supporters of NY online casinos.

How NJ extension blunder affects potential NY online casinos

Last month, Trenton lawmakers inexplicably altered a noncontroversial 10-year extension of legal online gambling to half as many years.

Widely seen as a political ploy rather than a legitimate policy change, the five-year extension of internet casinos in NJ may have ripple effects on the other side of the river that travels upstream to Albany. The secrecy around why NJ officials opted to tinker with the online gambling industry is a one-two punch for NY proponents.

For starters, it brings into question the desire of elected officials in NJ — and, by extension, its residents — to continue allowing a vice activity. If online gambling is so “great” for NJ, then why would anyone want to mess with a good thing?

It’s a fair point. And one that NJ could have put to rest early on if anyone associated with the changes to online gambling had been forthright with an explanation.

Instead, it now opens the door for unfounded theories and worst-case scenarios, which could be damaging to NY online casino legalization efforts in 2024. At the very least, pushing back against disinformation is a hurdle NY online gambling allies were hoping to avoid this go-round.

And that’s the second fallout from NJ’s head-scratching decision.

Opponents of NY online casinos have more fodder

Gambling expansion opponents often highlight the long-term issues that accompany casinos or sports betting. According to some gambling foes, the industry’s negative influence in places like Atlantic City or Las Vegas is visually represented by urban blight, poverty and addiction.

Online gambling has largely avoided those critiques (and others), given its relatively short lifespan.

But, now, opponents have an opening.

“What has NJ seen or what has happened there that is causing officials to have second thoughts?”

“What do NJ officials know about online gambling that they’re not telling the public.”

Politics is nasty business and opponents of gambling expansion in NY now have additional tools at their disposal, thanks to a political fumble in NJ.

Still, online casinos continue to be cash cow

The flip side of this bleak picture is that online gambling is thriving, not just in NJ but in Michigan, Pennsylvania, Connecticut and West Virginia. In all five of those jurisdictions, online revenue is increasing and state collections are going up.

That last part is critical for the battle for NY online casinos. New York will, undoubtedly, impose a high tax rate on internet gambling revenue. Given the success of NY online sports betting, despite its highest-in-the-country 51% tax rate, the prospects of a billion-dollar digital casino industry are likely.

Michigan and Pennsylvania have recently overtaken NJ as the country’s largest legal online casino markets. The Garden State held that title for more than nine years.

New York surpassed NJ and Nevada as the sports betting capital of the United States after introducing mobile sportsbooks in 2022.

Will online casinos in NY be the next big thing?

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David Danzis

David Danzis is a writer for PlayNY. A New Jersey native and honors graduate of Rutgers University, he served as a newspaper reporter for the New Jersey Herald and Press of Atlantic City, earning statewide awards for his coverage of politics, government, education, sports and business. Today, he contributes to New York's growing legal gambling landscape, including online sports betting and potential legalization of NY online casinos. David lives in Mays Landing with his wife and two children. When not on the beach, a golf course, or snowboarding, David enjoys watching his beloved New York sports teams — Yankees, Jets, Rangers and Knicks.

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