Expanded Gambling Proposal Advances In New Jersey

By John Celock

A New Jersey legislative committee started the process Thursday morning to open casinos in the state outside of Atlantic City.

The Assembly Judiciary Committee voted in a party line vote to advance a proposed amendment to the state constitution that would allow for the opening of two casinos outside of Atlantic City. The proposal comes amid opposition from those in Atlantic City, who say the opening of new casinos in the northern part of the state would be a deathblow to the struggling seaside resort.

“If we have casinos in other parts of the state, we could lose another 14,000 jobs,” Atlantic City Chamber of Commerce President Joseph Kelly told the committee.

Under the terms of the proposed amendment, two new casinos would be allowed to open in the state as long as they are at least 75 miles from Atlantic City and are located in two separate counties. The proposal is geared towards opening one of the casinos at the Meadowlands sports complex in East Rutherford. The mileage limit would limit the new casinos to the northern counties of the state.

Assembly Tourism, Gaming and the Arts Committee Chairman Ralph Caputo (D-Nutley), the amendment’s sponsor, told the judiciary panel that the proposal would allow for New Jersey’s casino industry to diversify beyond Atlantic City and better compete with casinos that have opened in New York, Pennsylvania, Connecticut and Maryland. He said the entire state has seen a downturn in revenue from the opening of casinos in other states, which has reduced Atlantic City’s dominance as the East Coast gaming mecca.

“Since 2006, revenue in the Atlantic City gaming industry has decreased significantly due to the economic conditions and the vicious competition from the states around our borders,” Caputo, a former casino executive, told the committee.

Under the terms of the amendment, two-thirds of the revenues from the new casinos to the state would be set aside for state and county programs for senior citizens and the disabled, with the remaining third being dedicated for non-casino related programs in Atlantic City.

Assemblywoman Holly Shepisi (R-River Vale) voted against the proposal, saying that the distribution of the money would not allow the communities in her Bergen County district, which would be near the Meadowlands casino, to receive funds. The distribution of funds to local projects has been common in casino proposals around the country, including funds from the Atlantic City casinos being distributed to South Jersey communities and projects by the state’s Casino Reinvestment Development Authority.

Shepisi said she would be in favor of a proposed amendment working its way through the state Senate that would distribute more money to local governments.

Caputo said that the amendment is “not anti-Atlantic City” saying he wants to help the seaside resort. He noted that with four casinos having closed in Atlantic City, there is a need for diversification of the resort’s economy, along with offering gaming in other parts of the state to better compete with neighboring states.

Assemblyman Chris Brown (R-Ventor City), who represents Atlantic City, said that his studies show that the addition of casinos in the northern part of the state will not help the gaming industry overall. He said the studies show that other states will add additional casinos closer to the New Jersey border in an attempt to gain the customers. Brown was serving as a temporary appointee to the Judiciary Committee for the day.

Brown pushed for the amendment to be delayed, saying that the Legislature needed more information. A delay could also postpone a statewide referendum of the amendment from the 2016 general election to the 2017 general election. Supporters of the amendment, including Judiciary Committee Chairman John McKeon (D-West Orange), said the state could not wait any longer to put the issue to the public. Caputo has been unsuccessfully pushing for the creation of a commission to study the casino industry, including casinos in North Jersey, for several years.

“When we are honest with ourselves is what reasonable business people would do or what reasonable leaders of New Jersey would do is know the facts,” Brown said.

Kelly told the committee that studies he has reviewed show that the growth of casinos has not led to new casino customers, but rather a more saturated marketplace. He said he has also seen a study that shows that two new casinos in North Jersey would cost Atlantic City 14,000 jobs, on top of the 18,000 jobs already lost in the city’s casino industry. He said with the job losses and the city having the highest foreclosure rate in the country, the focus should be on Atlantic City and not new casinos.

Several years ago, Gov. Chris Christie (R) and state leaders created a new tourism district in Atlantic City in an attempt to drive new tourism business to the city. The Miss America pageant also returned to Atlantic City after a several year hiatus. Caputo said that the tourism district has not helped. Caputo’s committee has held several hearings on the casino industry this year.

John Tomicki, the executive director of the League of American Families, said his group is opposed to the amendment saying that it has not been studied enough and that the casino market is over saturated. He also questioned what he said is a rushed nature of the amendment.

“We had no legislative meetings for a number of months, now suddenly this government by constitutional amendment,” he said. “You are better than that.”