New Jersey Casino Referendum

Modified by Daniel Hardman on July 30, 2021 in

New Jersey Casino Referendum

For decades Atlantic City has had a monopoly on casino gambling in New Jersey thanks to a law passed in 1976. Since then the Constitution of New Jersey has only permitted casino gambling in Atlantic City. The first 30 years after the law passed saw a continuous increase in job creation in the seaside casino hub. Revenues also climbed steadily, peaking in the mid 2000’s at around $5.2 billion.

But things began falling apart shortly after. Even so, at least the struggling resort city still had its coveted casino gambling monopoly. However, there might be some big changes on the horizon.

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The 2016 Referendum

In 2016 a referendum was put to voters to decide whether or not the constitution should be amended to allow casino gambling in two additional counties outside of Atlantic City, albeit 72 miles away in northern New Jersey. Casino license holders in Atlantic City would have first claim to submit proposals for the new casinos.

Their proposals would have to be accompanied by a $1 billion investment. If a period of 6 months lapsed with no proposals received they would be opened up to people from outside Atlantic City.

The decision was put to the citizens, and lost by a landslide with only 22% of responders voting in favor of it.

Earlier this year however, some of the bills from the 2016 campaign for casinos were introduced again. Proponents of the amendment argue that if the constitution is not amended to allow the expansion of casino gambling into North Jersey, casinos may begin popping up in other areas, creating more competition for Atlantic City and draining potential revenues from the entire state.

While there is no telling yet when, or if, these bills will be passed, it’s interesting to speculate on what either outcome might mean for Atlantic City. The original 2016 amendment stated that one-third of the state’s share of revenues would be allocated for the recovery, stabilization, or improvement of Atlantic City.

However, a large percentage of the city’s revenue is derived from visitors from North Jersey. It’s hard to imagine that a portion of the state’s share in the new casinos’ revenues would help offset the loss of revenue from North Jersey tourists in a significant way.

History Repeats Itself

Atlantic City is no stranger to competition and setbacks. 20 Years ago Atlantic City was the only place on the East Coast where people could go for some casino gambling action, but over the years many casinos began opening in neighboring states such as New York, Pennsylvania, and Maryland. The competition proved tough for the gambling resort and Sands Casino Hotel closed in 2006.

The Great Recession in the United States didn’t help matters. The financial crises lasted 2 years between 2007 and 2009 and saw many people losing their incomes and having less money to gamble. A string of casinos began closing in Atlantic City starting with Atlantic Club in 2014. Jobs also began dwindling, and the city never completely recovered from the setbacks. Today, it paints a sad portrait compared to its heyday. 

Despite Atlantic City’s disappointing circumstances, many people still believe that it can turn its fate around and reestablish itself as the resort destination it was always meant to be. That’s why they continue opposing the referendum that would allow more casinos to be built in New Jersey.

According to mainstream theory, there’s a pool of gamblers that all the casinos in the area will be competing for, so the addition of more casinos won’t help New Jersey’s revenues as a whole.

Is the Referendum Relevant?

The legalization of online gambling in New Jersey back in 2013 will likely also not help Atlantic City’s cause. The generation that enjoyed land-based gambling is slowly fading away and being replaced by millennials who gravitate towards online forms of entertainment.

Online gambling has exploded in the last decade as people all over the world began choosing it over its land-based counterpart. Unless major gambling capitals like Atlantic City can find a way to incorporate online gambling into their offerings, perhaps there isn’t much of a future for them at all. Who knows?

Whatever happens, we will be looking on with anticipation to see if the New Jersey casino referendum gets instated. Whether it does or not, we hope Atlantic City can save itself from its seemingly bleak future.

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