New Jersey loves the money from online sports betting, but fears addictive consequences

TRENTON, N.J. — Online sports betting is reaping new revenue for New Jersey but also raising concerns about gambling addiction and potential harm to the finances of Atlantic City's casinos that depend on in-person gamblers, sports books and problem gambling treatment workers testified Thursday.

The state Legislature held a hearing to examine the impacts of online sports betting, where New Jersey is a national leader. Its court challenge to a ban on sports betting in all but four states resulted in a 2018 U.S. Supreme Court ruling allowing any state to offer it; 38 currently do.

The testimony alternated between praise for the industry's economic benefits and concern about its harmful potential.

“One can lose tens of thousands of dollars within minutes simply by picking up a cell phone,” said Felicia Grondin, executive director of the Council on Compulsive Gambling of New Jersey.

More than 90% of sports betting is done online in New Jersey.

But Jeremy Kudon, president of the Sports Betting Alliance, highlighted the additional money and jobs that online sports betting have brought to the state. The group consists of sports betting companies FanDuel, DraftKings, BetMGM and Fanatics, which together have 89% of New Jersey’s sports betting market.

“It's a tremendous economic success story,” he said. “Our industry employs over 4,000 people in north Jersey alone. This is bringing an economic boom to the state.”

Through the first nine months of this year, over $9.2 billion has been legally wagered on sports in New Jersey, with $835 million of that having been kept as revenue by casinos, horse tracks and their online partners.

Over $105 million in online sports betting taxes have been paid to the state over that period, with an additional $2.2 million coming from retail sports bets.

Sports betting money is not solely for the casinos to keep. Like internet gambling money, it must be shared with outside parties including tech platforms and sports books.

Christina Renna, president of the Chamber of Commerce Southern New Jersey, said the additional jobs and revenue are helping the casinos. But she also noted that the gambling halls' primary business — money won from in-person gamblers — has not rebounded to the levels of 2019 before the COVID-19 pandemic broke out.

“Those 22,000 casino jobs need focus, care and attention, too,” she said.

Numerous speakers voiced concern about gambling addiction in New Jersey.

Grondin said 1% to 3% of adults nationwide are problem gamblers; in New Jersey, that figure is 6%.

Since New Jersey's Supreme Court victory in 2018, calls to the agency's 800-GAMBLER help line have increased by 277%, she said, many of them from young adults.

Lori Kalani, chief responsible gaming officer with DraftKings, said her company, and the industry as a whole, takes customer protection seriously. She said she grew up in Nevada in a family where gambling addiction was a problem.

“Online gaming is for fun and entertainment,” she said. “We are committed at DraftKings to making sure players play responsibly.”

Kalani said DraftKings has 60 employees dedicated to responsible gambling measures, and regularly contacts customers whose betting behavior indicates a potential problem, offering them help, and in serious cases, suspending or terminating their accounts.

Tim Buckley, a senior vice president with the NCAA, supported legislation pending in New Jersey that would ban bets on the statistical performance of college athletes as a way to protect them from online harassment and threats.

He cited the case of University of North Carolina basketball player Armando Bacot, who said in March he had received over 100 direct messages from bettors angry that he had not made enough rebounds during a particular game for their bets to win.

Lia Nower, director of the Center for Gambling Studies at Rutgers University, said more than two-thirds of gamblers place live bets during games.

“It is in-the-minute,” she said. “Odds change, it's impulsive, it can be affected by alcohol use. Young people bet in-game a lot.”

She also said 14% of New Jersey sports bettors reported having thoughts of suicide and 10% actually made an attempt at it.