New Jersey voters yesterday resoundingly rejected a ballot question seeking to end Atlantic City’s longstanding monopoly on casino gambling in the state. They also appeared to narrowly approve a question seeking to protect state fuel-tax revenue from being spent on anything other than transportation projects.
Public opinion polls had foreshadowed the likely failure of the casino expansion question, and with nearly 100 percent of the votes counted as of early this morning, more than 2.2 million votes were cast against the proposal compared to just 643,000 in favor of it.
The result means those who want to see legalized gambling in north Jersey will now have to wait at least two years before they can try again to convince voters the state needs new casinos to recapture revenue being lost to those in neighboring states like New York and Pennsylvania. The ballot question’s failure also served as a big win for Atlantic City, where leaders in the struggling seaside resort feared permitting new casinos to open in north Jersey could deliver a final, fatal blow to the local economy.
The narrow passage of the fuel-tax question, meanwhile, means roughly $1 billion in annual revenue that’s expected to be generated from the 23-cent gas-tax increase that just went into effect won’t be able to be used to fund anything other than road, bridge and rail projects.
The margin of victory on the fuel-tax question was just over 30,000 votes, with a little over 1.5 million votes cast by those supporting the dedication compared to 1.47 million by those opposing it. It also marked a setback for Lt. Gov. Kim Guadagno, a potential 2017 GOP candidate for governor who had tried to rally opposition to the dedication on the grounds that it effectively promoted increased state borrowing.
Opponents of casino expansion last night relished their victory, while those who supported the fuel-tax dedication were also in high spirits after sweating out a close contest.
The ballot-question results came after a combined $26 million was spent seeking to influence voter opinions on the two issues, according to the latest campaign-finance reports filed with the New Jersey Election Law Enforcement Commission. But the outcomes largely mirrored poll results released in late October by Fairleigh Dickinson University. New Jersey voters, according to the FDU poll, were convinced that opening new casinos in the state was a bad idea, but were nearly evenly divided on the question of whether to dedicate fuel-tax revenue.
They were the only questions to go before voters this year after attempts by lawmakers to also have referendums on public-employee pension funding and changing the way the state draws up legislative districts fell short.
The question seeking to allow casinos to open in two counties in north Jersey was the first attempt to expand gambling in the state since voters approved a constitutional amendment in 1976 that permitted casinos to operate in Atlantic City. Supporters of the expansion pointed to the likelihood that the proposed new casinos would generate economic development by attracting billions of dollars of new investment. They also predicted that as many as 12,000 new jobs would be generated.
But where exactly the new casinos would be built — East Rutherford and Jersey City were long eyed as the likely places by insiders — was never clearly defined for voters. And, as roughly $15 million was spent by groups opposing the ballot question, the October FDU poll showed voters opposed the new casinos by a 74 percent to 20 percent margin.
Bill Cortese, executive director of the group Trenton’s Bad Bet, which led the charge against the casino expansion, attributed last night’s success to “a broad coalition of community leaders, unions, small businesses, and residents who are convinced that North Jersey casinos would be a detriment to the entire state.”
Morris Bailey, the owner of Resorts Hotel Casino in Atlantic City, called the results “an important step” for Atlantic City, which has struggled to overcome the closure of five of the resort’s 12 casinos in recent years. “On behalf of the 30,000 employees and their families that rely on the Atlantic City casino industry, we are gratified by the overwhelming defeat of this initiative,” Bailey said.
A statement released last night by Paul Fireman and Jeff Gural, the two founders of the group Our Turn NJ, which urged voters to approve the casino expansion, said they were “disappointed, but not surprised” with the results. After putting up more than $8 million to support casino expansion, they had already announced weeks ago that they would not be spending any more on ads to sway voter opinions.
“We do not view the failure to pass Question #1 as a rejection of gaming expansion, but as a rejection of our state’s current political climate and a failure to have all the facts presented to them,” the statement said.
The question seeking to dedicate fuel-tax revenue to transportation projects via the state Transportation Trust Fund was approved by lawmakers as a ballot issue with little controversy at the beginning of the year. And it preceded a tax hike enacted by legislation under a deal struck last month between Republican Gov. Chris Christie and Democrats who control the state Legislature. The gas-tax increase took the tax the state levies on the gross receipts of petroleum products from 4 cents up to 27 cents beginning on November 1.
But there was also some confusion in the last few weeks as some opponents of the dedication tried to portray the question as giving voters a chance to reject the gas-tax increase. Instead, the ballot question only asked voters if all of the revenue from the gross-receipts tax should be dedicated to the TTF beyond up to $200 million that had previously been constitutionally protected. The question also sought to dedicate to the TTF the remaining 3 cents of the state’s 13.5-cent tax on diesel fuel that hadn’t already been protected by voters.
Voters had also previously dedicated all revenue generated by the state’s 10.5-cent tax on gasoline to funding road, bridge and rail projects via the TTF.
The passage of the ballot question blocks a practice followed by governors from both parties of raiding funds through the annual budget process that have been earmarked only by statute for a specific purpose. It also now means revenue from the increased fuel tax will be available to issue bonds to fund state transportation projects, complying with a constitutional amendment tightening state borrowing rules that voters approved in 2008.
Under an eight-year TTF finance plan approved by Christie and lawmakers last month, the state will borrow about $12 billion out of an overall $16 billion in planned transportation spending. But that plan marks an improvement over the ratio of spending to borrowing that the state has relied on for the last decade as the gas-tax rate has remained flat.
Tom Bracken, chair of the group Forward New Jersey, which supported the constitutional dedication, said voters “have helped put New Jersey on the right track” by passing the ballot question. “By approving this amendment, they have constitutionally committed billions of dollars over the next eight years to fix our roads, bridges, and commuter trains,” said Bracken, who is also the president of the state Chamber of Commerce.
Robert Briant, chief executive officer of the Utility and Contractors Association, said the “yes” vote will protect the $1 billion in revenue the tax hike is expected to generate. “Our state finally has the long-term and dedicated source of funding we have sorely needed for a long time.” Briant said. “Now that we have it, it is time to get to work fixing and improving our infrastructure.”
The borrowing issue was a point of contention for some opponents of the dedication, including Guadagno. In a rare public break with Christie, she urged voters in the final weeks leading up to Election Day to oppose the ballot question.
Matthew Hale, a political science professor at Seton Hall University, said the results of the two ballot questions “speak to how much voters dislike Trenton.”
“The tag line for casino opposition was ‘Trenton’s Bad Bet’ and it worked so well the casino backers just quit,” Hale said.
“On Question 2, the voters decided again not to trust Trenton and took away the Legislature’s ability to use the gas tax money for something else,” he said.