by Bill Finley
With several signs pointing toward the Supreme Court of the United States ruling in favor of the state of New Jersey in its efforts to legalize sports betting at racetracks and casinos, management at both the Meadowlands and Freehold said they’re looking forward to the day when they can accept bets on sporting events.
The Supreme Court heard oral arguments in the case known as Christie v. National Collegiate Athletic Association Monday and, based on questions asked by the justices, virtually every legal expert who has weighed in on the subject expects that New Jersey will prevail. A decision is expected to be announced in the first half of 2018.
“We invested heavily in this with Monmouth Park sharing the legal fees and it looks like it’s going to pay off,” Meadowlands owner Jeff Gural said. “It’s good news. It’s great news, actually.”
But neither Gural nor Chris McErlean, the vice president of racing with Penn National Gaming, which co-owns Freehold with Greenwood Racing Inc., were willing to predict that sports betting would produce a large influx of revenue and neither would commit to using any of the extra money for purse increases.
“From what I’ve been told it doesn’t make a lot of revenue, but it would put people in the building and that would certainly help pay the bills,” Gural said. “There’s still a lot of uncertainty surrounding the possible outcomes of the case. One thing that is certain is it will help. The question is will the people coming here to bet on a football or baseball game also bet on horse racing? I suspect there are probably people who bet on horse racing and sports who might come and our live handle would go up.”
McErlean said that sports betting would likely be something that would help Freehold stay in business.
“Certainly, given the state of the industry in New Jersey, any opportunities for increasing potential revenue and foot traffic within the building is a good thing,” he said. “It remains to be seen what actually will be permitted, whether it will be in New Jersey only, all over the country, on-line or just at bricks and mortar. This is an opportunity we’ve been restricted from up to this point and we would certainly welcome this opportunity that will help keep Freehold viable going into the future.”
Single game sports bets are illegal in the U.S. in all states but Nevada due to a federal law known as the Professional and Amateur Sports Protection Act of 1992 (PASPA). The Supreme Court could rule against New Jersey and keep the sports betting ban in effect. If the court rules in favor of New Jersey then it could go in two directions. One would be that only New Jersey’s partial repeal of PASPA, which allows for sports betting only at casinos and racetracks and does not call for it to be regulated, is legal. The other is that it could declare PASPA unconstitutional. If that turns out to be the court’s decision it could easily open the doors for sports betting to be legalized rapidly in a number of states and, perhaps, go online.
Dennis Drazin, who heads the management team at Monmouth Park, seems far more optimist than Gural is about the windfall to come from sports betting, estimating that Monmouth’s take on sports bets placed there will be $75 million. He said $25 million will go towards overhead and that the remaining $50 million would be split evenly among the racetrack and William Hill, the bookmaking firm that has been hired to run sports wagering at the Jersey Shore track.
Gural notes that the Meadowlands racetrack is largely inaccessible when either the Giants or Jets are playing at nearby Met Life Stadium on Sundays, which would limit his ability to take bets on the NFL, and also wonders if people will be willing to travel somewhere to make a legal bet when there are still many ways to bet illegally on line through foreign websites.
“It’s clear you’d have huge days like the Super Bowl, the football playoffs, maybe the college bowl games and the NCAA tournament,” Gural said. “But on other days are people going to drive 30 miles to the Meadowlands just so they can make their bet legally?”
It also remains unclear how the Supreme Court decision will impact online wagering in the state and whether 4njbets.com, which is run by TVG, and is the only ADW Jersey residents are allowed to use, could take sports bets. If they do take sports bets on-line, all the Jersey tracks would share in the profits.
None of the New Jersey tracks have any obligation to take any of the profits from sports bets and put them into purses. Gural admitted he won’t immediately be looking to fatten up the purse account.
“At the Meadowlands we’ve overpaid purses by $4 million right now and (paying more into the purse account) is not an issue for me,” he said. “The horsemen are lucky I fund the losses that keep the Meadowlands open so I doubt if this would have a dramatic effect on purses. All it’s going to do is help pay the bills. Obviously, if I am wrong and there is some bonanza from sports betting that I am not anticipating I would look into sharing it with the horsemen. But all I’ve ever head from people is you don’t make a lot of money from sports betting.”
McErlean was not clear about what Freehold would do with any extra profits made for sports bets.
“We haven’t had any real discussions on that,” he said. “A lot will depend on what we are actually permitted to do and what type of investment it takes and what is the potential return. We really have not addressed that matter.
Gural said if the court rules in New Jersey’s favor he would hope to have a sports book up and running by the beginning of the 2018 NFL season.