New Jersey could sanction online gambling

The bill would make New Jersey the first state to sanction online gambling. The Republican governor, who has until Thursday to veto or sign the bill, hasn't publicly stated his stance.

"I think you're seeing a shift in focus because the thought process is that if several large states legalize, that will put pressure on the feds to act," said Nick Iarossi, a gambling lobbyist in Florida.

Regardless of Christie's decision, gambling experts say momentum is growing behind states' efforts to legalize online gambling for their own residents, known as intrastate gambling. Last week, Iowa lawmakers introduced a bill to legalize online poker, and California and Florida are among other states considering similar bills.

The debates over online gambling come as states scramble to balance their budgets in the face of yawning deficits.

In Wisconsin, Governor Scott Walker proposed a two-year budget cutting more than US$ 1.25 billion in state aid to schools and local governments. The Republican governor said the deep cuts and a separately proposed bill restricting state workers' collective-bargaining rights are necessary to address a US$ 137 million shortfall for the fiscal year ending June 30 and a projected US$ 3.6 billion deficit for the following two fiscal years.

Backers of online gambling initiatives stress, in part, the allure of capturing new revenue for statehouses. Casino gambling has been expanded in several states in the past few years, including Pennsylvania and Florida, based partly on that argument.

In New Jersey, however, under the bill passed by the legislature nearly all of the money would be allocated to the horse-racing industry, which had been receiving payments from casinos in exchange for preventing gambling expansion at racetracks. Other winners could include companies that provide software for online gambling, and they are backing the proposal.

In New Jersey, the bill passed through both houses of the legislature in recent months with overwhelming support of both parties. But hurdles remain. Christie could conditionally veto the bill, which would send it back to the legislature with changes, according to a person familiar with the matter.

The bill would likely be derailed if he said it required an approval by voters. A recent poll found that 67% of New Jersey residents polled opposes Internet gambling.

Proponents argue the state would benefit. "Revenue is leaving the state to offshore Internet gaming and we should recapture those revenues for New Jersey and create jobs in New Jersey," said Raymond Lesniak, a state senator, who argued the state could become a hub for the industry if the state is the first to legalize Internet gambling.

Lesniak estimated the new law would bring the state around US$ 30 million annually in taxes to New Jersey based on an estimate that it would produce US$ 200 million in revenue.

The state Office of Legislative Services concluded state revenue would increase as a result of the bill but said there was too much uncertainty surrounding online gambling to predict the amount.