New Jersey Lawmakers, Pro Sports Leagues Clash Over Sports Betting Bill

New Jersey hopes to be the second state to expand sports wagering after the U.S. Supreme Court struck down a federal ban on sports betting in May. Ethan Miller/Getty Images

New Jersey lawmakers and professional sports leagues clashed over a bill on Monday that would legalize sports betting, largely arguing over whether the leagues should get a cut of the money wagered to keep the games free from cheating.

The sports betting measure cleared Assembly and Senate committees on Monday, and lawmakers hope to send the bill to Gov. Phil Murphy’s desk by the end of the week. New Jersey is seeking to be the second state after Delaware to expand sports wagering since the U.S. Supreme Court struck down a federal ban on sports betting in May.

Officials from the MLB, NBA and PGA Tour testified against the bill, saying it lacks the “tools” the leagues need to ensure there is no corruption in their games. Among other amendments, the leagues want a 0.25 percent “integrity fee” on the amount gambled on their games. They claim the leagues will have to spend more on monitoring bets and investigations with the nationwide expansion of sports gambling.

“There is nothing more important to our diehard fans that the games they watch, the games they follow in the newspaper every day, remain unscripted, spontaneous entertainment, free from corruption and manipulation,” Bryan Seeley, senior vice president and deputy general counsel for Major League Baseball, told the Assembly Tourism, Gaming and the Arts committee.

But Assemblyman Ralph Caputo said the leagues were wasting their time and wouldn’t get a cut of the revenue. He noted Nevada, which already has legalized sports betting, does not let leagues collect an integrity fee. And he recounted how the leagues sued New Jersey over its efforts to legalize sports betting, costing the state roughly $9 million in legal fees.

“The ‘tool’ you’re looking for is money, and that’s not going to happen. You might as well face that reality,” said Caputo (D-Essex). “As a suggestion, you might want to issue a check for $9 million to the state of New Jersey, just for good faith.”

The Assembly Tourism, Gaming and the Arts committee and Senate Budget and Appropriations committee both unanimously approved the bill. The full Senate and Assembly are scheduled to vote Thursday on the legislation.

The bill (A-4111) would impose an 8.5 percent tax on the revenue generated from bets at the state’s casinos and race tracks and a 13 percent tax on online wagers. An additional 1.25 percent tax would be dedicated to the racetracks’ host municipalities and counties, while another 1.25 percent Investment Alternative Tax would go toward a marketing program to attract conventions to Atlantic City.

Atlantic City Council President Marty Small and members of the city’s branch of the NAACP urged lawmakers to give the financially-troubled city a larger share of the sports wagering revenue and dedicate the funds for property tax relief.

“Please take this opportunity to change what is being given to Atlantic City. Instead of giving us crumbs, give us a meal please,” said Charles Goodman of the Atlantic City NAACP.

Murphy has publicly supported legalizing sports betting, but it’s unclear whether he would sign the current version of the bill into law. In a statement, Murphy spokesman Dan Bryan declined to comment on the bill but said the governor “looks forward to working with the legislature to enact a law authorizing and regulating sports betting in the very near future.”

Murphy and Democratic lawmakers are currently at an impasse over the state budget, with legislative leaders resisting Murphy’s plans to raise $1.7 billion in taxes to boost funding for schools, pensions and infrastructure.

Senate President Steve Sweeney said he has no assurances Murphy will sign the bill and said it would be “a shame” if the governor holds up on signing the bill as part of ongoing budget negotiations.

“But that’s his call,” Sweeney said. “I’m not going to lose any sleep over it.”

New Jersey Lawmakers, Pro Sports Leagues Clash Over Sports Betting Bill