On March 3, 2011, Gov. Chris Christie vetoed a bill that would have made New Jersey the first state to legalize Internet gambling. Gov. Christie cited several concerns with the measure, including potential expansion of unregulated casinos outside of Atlantic City. He also objected to a provision in the bill that would have used some of the funds generated from Internet gambling to subsidize horse racing, which the governor has insisted become a self-sustaining industry.
Proponents of the measure estimate that the bill could have created thousands of jobs. And with a tax on Internet betting winnings set at 23 percent, the bill could have brought in $50 million in tax revenue for the cash-strapped state.
Gov. Christie suggested that New Jersey voters could legalize Internet gambling through a referendum. Democrats in the New Jersey Legislature have vowed to try again with improved legislation.
Supporters of Internet gaming are seeking federal legislation that would allow Internet gaming nationwide, overcoming the need to pass such legislation in each state. Internet gambling legislation was introduced in the last Congress by former House Financial Services Committee Chairman Rep. Barney Frank (D-Mass.), which provided the legal framework, and by Rep. Jim McDermott (D-Wash.) and Sen. Bob Menendez (D-N.J.), which provided for the taxation of the proceeds from a legal Internet gambling program. These bills never made it past one late 2010 hearing in the House Financial Services Committee.
It seems doubtful that the concept of legalized Internet gaming will be actively considered, at least in the short term, by the new Republican House. Gov. Christie's veto of the New Jersey bill and the lack of active consideration by Congress last year probably signals that the concept of legalized Internet gambling is not ready for prime time on the national stage.