newjerseynewsroom.com

BY JOSH McMAHON

NEWJERSEYNEWSROOM.COM

COMMENTARY

Sen. Ray Lesniak is playing it again. This time he's lured in Senate President Steven Sweeney and he's trying to get the Assembly to buy into the game.

Exactly what game is that? The over inflated revenue game; the one that says New Jersey can rake in upwards of $100 million a year from sports betting. In a state strapped for cash that $100 million figure is awfully alluring.

But is it real? Nah!

I've got nothing against gambling in general or sports betting in particular. I don't buy the argument of the National Football League and other groups that allowing people to bet on the Giants or the Yankees or the Nets would some how destroy the integrity of the game.

Lesniak and others claim New Jersey can collect about $100 million a year from sports betting but their numbers don't add up.

I can't follow his math.  I challenged him on this last year but never heard from him. He didn't produce the numbers.

Here's why I'm skeptical. Last year all 266 Nevada casinos "won" a total of $136.3 million from sports betting. That's what the casinos had after they paid off the winners.

(As an aside, for the Super Bowl the casinos won $6.8 million on bets of $82.7 million. By comparison, in 2008 when the Giants pulled the big upset, the casinos lost $2.5 million on bets of $92.3 million.)

Those "win" figures, by the way, are not profits and not what the state got. The state cut is a percentage of that. Nevada's tax is graduated with a maximum of 6.75 percent. In New Jersey the tax is 8 percent.

Here are a few more numbers. Nevada, last year, collected $924.4 million in taxes from the casinos, which had gross revenue of $11.5 billion. The $136 million from sports betting was part of the gross.

In New Jersey the state collected $426.8 million in taxes from an industry that had $4.5 billion in gross revenue.

If Lesniak is correct, the state will get an additional  $100 million just by adding sports betting to the gambling menu. That would be a 20 something percent increase in tax money. The Nevada figures just don't support that argument.

In any event Lesniak and the rest of the guys are getting ahead of themselves.

Before the state can collect any tax, it has to convince the courts to overturn a 1992 federal law that limits sports betting to four states -- Nevada, Delaware, Montana and Oregon.

Eighteen years ago Congress offered states the option of permitting sports betting. It was not an open-ended offer. States had a deadline. New Jersey politicians decided to take a pass. Those other four states did not.

Lesniak has gotten the state Senate to approve a resolution allowing that body to join his lawsuit to fight the ban. He's asking the Assembly to do the same. And, to his credit, Lesniak says he'll pay for it himself.

Good for him.

Okay, let's say he is successful. Does he really think only New Jersey will enact legislation allowing sports betting?

It's a sure bet that other states that didn't embrace sports wagering in 1992 will be grabbing for those gambling dollars. And that will reduce the take for our state even more.

I'm not saying don't go after the money, I'm just saying let's be realistic.

Here's one final thought: If sports betting could be such a moneymaker, why haven't the casinos been pressuring for it? Why haven't the casinos tried to get the federal law over turned?

The answer is in the Nevada figures. Out of $11.5 billion in gross gambling revenue, $136 million was attributed to sports betting.

What's that like 1 percent?

Ray, I'm still waiting to see your figures.

Josh McMahon is a former member of The Star-Ledger's editorial board and previously had served as the newspaper's political editor. He may be reached at This e-mail address is being protected from spambots. You need JavaScript enabled to view it .