In USA, Exchange Wagering Seen As Savior for Racetracks

IF it is legal

State Sen. Ray Lesniak, D-Union, said Thursday that a proposed new form of betting on horse racing in New Jersey is illegal under current federal law — but he supports passage of a bill including exchange wagering anyway.

“We’re not going to back down — we’re going to move forward and make sure that the horse racing industry survives and that Atlantic City gets a boost as well,” Lesniak said.

But Barbara DeMarco, a lobbyist for the state’s thoroughbred horsemen, said the group has received a legal opinion that exchange wagering is legal. She added that California signed an exchange wagering bill into law this year, with the betting to begin in 2012, “so the precedent has already been set.”

State Democratic officials have been working for months on a broad package of bills to help subsidize horse racing purses and to revitalize Atlantic City’s casino industry. Gaming “summits” were held at the Meadowlands Racetrack, Monmouth Park and Atlantic City.

One of the least controversial ideas seemed to be introducing exchange wagering, a variation on traditional parimutuel wagering in which the odds are determined by the collective sentiments of bettors on each horse. Exchange wagering instead electronically pits one bettor against another who expects the opposite result at the agreed-upon odds — usually on whether a particular horse will win a race.

Lesniak takes on feds

Lesniak, a senior partner in the Weiner Lesniak law firm based in Parsippany, said that a federal law passed in 1992, the Professional and Amateur Sports Protection Act (PASPA), allows for gambling nationwide only for lotteries and for “parimutuel animal racing or jai alai.”

“It’s clear that PASPA is rearing its ugly head again,” said Lesniak, who has filed suit, seeking to overturn the law as unconstitutional. Lesniak objects to four states — Nevada, Delaware, Montana and Oregon — being exempt from the law’s limitations on gambling, while the other 46 states are not. He also questions why the federal government is involved in regulation of gambling, and Lesniak has introduced a bill to bring Las Vegas-style pro sports betting to Atlantic City despite of the law.

Horse racing advocates and BetFair — a British company that runs exchange wagering in England — for months have been advocating to make New Jersey the first state to bring the new betting to the United States. In its advanced form, as in Britain, fans can continue to make bets with each other even during the horse races.

DeMarco said that casino gambling is defined as an interaction where the house sets the odds, and parimutuel wagering is any betting that takes place with bettors making the odds themselves — whether from all the bettors, as in traditional race wagering, or one on one, as in exchange wagering. Lesniak disagreed, saying that what defines parimutuel is whether players are betting from the same overall pool.

The state Assembly passed an exchange wagering bill in Trenton in July, though many details were lacking. Senate Democrats have expressed their inclination to support the new betting.

Jon F. Hanson, Governor Christie’s adviser on horse racing and casino issues, said last week that exchange wagering could be approved by the administration “if it’s permitted under the law.” A spokesman for Christie had no comment on the dispute.


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