New Jersey Sports Betting Bill Expected to Pass Today, Tilman Fertitta’s Golden Nugget Left on Sidelines
Posted on: June 7, 2018, 07:36h.
Last updated on: June 7, 2018, 07:36h.
New Jersey sports betting legislation should receive final approval on Thursday, marking the last chapter of the state’s long battle to offer sports books at its racetracks and casinos. But when the Garden State finally starts taking those bets, there will be one noticeable absentee: Atlantic City’s Golden Nugget.
Ever since the US Supreme Court’s rejection of PASPA on May 14 — the federal law that prohibited sports betting in all but four excepted states — lawmakers have been busy ironing out the details of how legal sports wagering will be applied in New Jersey.
These include an integrity provision specifying that owners of professional sports teams will be precluded from licensing. That would rule out the Nugget, because owner Tilman Fertitta bought the NBA’s Houston Rockets last September.
Quandary for Fertitta
It would also theoretically prohibit over half of the state’s casino sector, including all properties owned by MGM and Caesars.
MGM owns the WNBA’s Las Vegas Aces, while Joshua Harris — whose Apollo Global Management has a stake in Caesars — owns the Philadelphia 76ers.
But New Jersey’s legislators have tweaked the legislation to allow MGM Resorts and Caesars Entertainment into the market by including exclusions for the gaming industry operators. MGM, because the team generates less than one percent of its total revenue, and Caesars, because Harris owns less than 10 percent of the casino giant.
But there’s no pass for Fertitta, who will be forced to give up his beloved hometown Rockets if he wants to benefit from the new bonanza with a Nugget sports book.
Ready, Set, Go
After fighting for years to allow sports betting — and with southern neighbor Delaware already one step ahead, having taken its first bets on Tuesday — New Jersey is wasting no more time getting the endeavor off the ground. As soon as the measure is finalized, those land-based books that are set up can start taking bets immediately.
Casinos will pay a tax rate of 8.5 percent of gross gaming revenue (gross revenue minus the amount paid out to customers as winnings), while an additional 1.25 percent add-on payment for casinos will go into a marketing fund for Atlantic City. Racetracks will pay the same 1.25 fee, with proceeds split among the host community and the county.
Meanwhile, online sports betting will be authorized to begin within 30 days of enactment of the bill. Internet betting will be taxed at 13 percent GGR.
Holding the Reins
The buck will ultimately stop at New Jersey Governor Phil Murphy’s desk. Murphy is returning from a whirlwind trip to Paris today, just 48 hours after going to the City of Lights for his daughter’s graduation there.
Some commentators have speculated that Murphy might use the bill as a bargaining chip and hold off on signing it to help straighten out a tense budget standoff with Senate President Steve Sweeney. But with the state having spent millions of dollars — and seven long years — fighting for the right to offer sports betting, holding the legislation at ransom will likely see plenty of pushback.