Gov. Christie makes “conditional veto” for online gaming bill

Governor Christie

 Governor Christie’s conditional veto of the online gaming bill – one which has online poker buffs celebrating and advocate state Sen. Ray Lesniak predicting approval in “a matter of weeks.” The tax goes from 10% to 15% in Christie’s version, almost double the 8% of brick-and-mortar casinos, and there is a 10-year sunset clause to allow the legislature to revisit the idea.

“Pursuant to Article V, Section I, Paragraph 14 of the New Jersey Constitution, I am returning Assembly Bill No. 2577 (First Reprint) with my recommendations for reconsideration.

For generations, Atlantic City was a prolific engine that drove economic growth in our State and generated significant revenues to support critical programs throughout New Jersey.

While Atlantic City’s reputation and stature as one of the premier resort destinations on the East Coast are well chronicled, it is no secret that revenue from the region’s most important industries, gaming and tourism, has been in decline. Since the beginning of my Administration, I have stressed the importance of reversing the trend of economic contraction in Atlantic City and have made the revitalization of the region’s gaming and tourism industries a key priority.

In furtherance of my commitment to these critically important industries, I signed landmark legislation in February of 2011 establishing the Atlantic City Tourism District. This
law, the product of a joint effort between my Administration and the Legislature, sought to enhance tourism in Atlantic City by empowering the Casino Reinvestment Development Authority
(“CRDA”) to coordinate the marketing efforts of the casino industry, implement public safety initiatives in Atlantic City, and make critical investments in both gaming and non-gaming
amenities in the region. The law also reorganized several State entities and authorities with tourism related duties and responsibilities in order to promote efficiency and achieve
greater synergies between such entities.

While some of the provisions set forth in this legislation would serve to advance the important goals of the 2011 Tourism District law, others are at cross-purposes with the law’s underlying objectives. Without question, one of the keys to success in Atlantic City lies with giving the CRDA the tools it
needs to effectively implement the State’s reform agenda. Toward that end, and consistent with the provisions of the Tourism District law, I firmly believe that the CRDA needs significant flexibility and freedom from burdensome, bureaucratic, and overly restrictive State mandates.
Regrettably, some provisions of this bill fail to recognize that goal and would serve to tie the hands of the very agency that the Legislature and I entrusted and empowered to carry out the difficult task of revitalization in Atlantic City.

For instance, the bill proposes to restrict the CRDA’s ability to manage its workforce by statutorily establishing conditions of employment affecting persons transferred to the CRDA by operation of the Tourism District law. Likewise, the bill mandates that certain other actions be taken by the CRDA,
such as assessing fees upon certain casino licensees and establishing noise standards within the Tourism District. While such agency action may be appropriate and warranted, the 2011
Tourism District law aptly recognizes the CRDA as the appropriate entity to make such determinations. We have made great strides in establishing the framework for sustainable, long-term economic growth and revitalization in Atlantic City. By increasing red-tape and bureaucracy in the
State’s oversight of the gaming and tourism industries, as proposed in this bill, we run the risk of hindering the progress we have made so far.”

Christie vetoed a somewhat similar measure in 2011, and has repeatedly expressed his ambivalence about the wisdom of allowing the new betting – legalized so far only by Nevada and Delaware and not yet implemented in any state. The state Constitutional deadline was noon today.

The bill has drawn national attention, both for the possibility that a New Jersey law opens the floodgates for other states to follow suit, and with speculation on what impact the decision could have on Christie’s prospects should he eventually run for President in 2016.

The New Jersey bill is similar to the Delaware law in potentially allowing all casino games to be played online, while Nevada’s law allows only online poker.