Online Casino Gaming Roars Again In NJ, Which Complicates Things
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In the first year of online gambling in New Jersey, it made up 4.5% of the Atlantic City casino industry's gross gaming revenue bottom line. The annual growth has turned it into the controversy of 2021. Atlantic County officials filed a lawsuit that is headed for court hearing next month. It stems from passage of a casino tax break bill in the last days of state legislative session this month and Gov. Phil Murphy's signature.
Sports betting was legalized in New Jersey in mid-2018. It's estimated that gross gaming revenue from in-house casino play will land between $2.51 billion and $3.69 billion in 2019. Sports betting made up 5.2% of the overall revenue in 2020, while online casino blossomed to represent 37%. in 2021, as the sites have remained open all year and entertainment-starved customers found a way to cope with pandemic restrictions.
The state Division of Gaming Enforcement reports revenue reached full boil during the pandemic. In 2016, casino operators agreed with city, county, and state officials on a change in how taxes are paid. The new plan set up a payment-in-lieu-of-taxes, or PILOT, that would give more certainty to all parties involved. PilOT deal was reached before sports betting was legalized and before online casino gaming had reached even 10% of the official bottom line.
The new law exempts online gambling revenue from the PILOT calculations. The county is suing the state to void the new tax law. County executive Dennis Levinson says it violates a settlement agreement from 2018. A state court judge has scheduled a Jan. 4 conference with attorneys from all the parties.
