A hearing will be held January 7th to discuss expansion of casinos to Northern New Jersey. There are two separate plans that will be discussed at the hearing.
The Assembly’s plan would use 35 percent of the tax revenue collected from the new casinos to invest in Atlantic City to counteract the current economic hardships the city has recently faced.
The second plan proposed by the Senate would also funnel revenues into Atlantic City. However, the Senate version would give significantly more cash to Atlantic City. A full 50 percent of the first $150 million of tax revenue would go to Atlantic City, then for each additional $150 million, the percentage given would decrease by 10 percent.
The Senate version is obviously more pro Atlantic City than the Assembly plan. A big question must still be asked with respect to whether or not Atlantic City really needs the Senates proposal. The city has had control over New Jersey gambling for over 30 years. Even with recent casino closures and legalization in surrounding states, the remaining casinos are still turning a profit.
Another issue many have with the Senate plan is that it would most certainly decrease much needed funding to statewide relief programs for both senior citizens and the disabled.
There are also differences between the two plans with respect to who can legally operate the two prospective North Jersey casinos. The Assembly would require one casino to be operated by an existing Atlantic City casino license holder, while the other casino license would be open to new companies. In the Senate plan, both proposed casinos could only be owned by previously operating and licensed Atlantic City properties.
What need to happen for a plan to make the 2016 ballot?
A compromise by either the Senate or the Assembly is necessary for either of these plans to make the 2016 ballot. New Jersey Assembly Speaker Vincent Prieto wrote a piece on NJ.com expressing his concern for the speed with which these bills are being addressed:
“In a perfect world, Atlantic City would be the Las Vegas of the East, with casino gambling seamlessly intertwined with family entertainment, major concerts and sporting events and hotels jammed with tourists, but we don’t live in a perfect world. Atlantic City lost its regional monopoly on gaming, and if we don’t act soon, our gaming industry will disappear. That would hit New Jersey’s senior and disabled residents — and all taxpayers — hard.”
How might new casinos influence the online market?
Additional casino licenses could mean more online licenses, and in turn additional online gaming companies could enter the state. Similar to the situation with brick & mortar casinos, however, it is arguable whether or not the addition of new operators would be sustainable.
In the case of online casinos especially, it’s tough to argue that the market itself would expand if North Jersey casinos go online. Players anywhere in the state can easily access the existing sites owned by Atlantic City casinos.
Regardless, consumers should benefit by increased competition. The impact that new competition – both live and online – may have on Atlantic City casinos is yet to be seen.