In December last year, New York gaming regulators cemented three new casino licences, which had been expected for years by stakeholders in New Jersey and Atlantic City. Now that the dust has settled and newly elected Governor Mikie Sherrill has had some time to adjust to office, conversations about the state’s next steps are beginning in earnest.
Sherrill, who replaced longtime governor and ardent gaming supporter Phil Murphy, was largely quiet on gaming issues during her campaign. She has since met with local leaders and press about the Garden State’s gaming economy and is expected to become more involved as time goes on.
On 3 March, Sherrill made her first visit to Atlantic City to meet with local leaders, including Mayor Marty Small.
According to a press release, points of discussion included “sustained property tax relief for Atlantic City residents, redevelopment of Bader Field, the state’s PILOT legislation, improvements along Atlantic Avenue, anti-violence and crime reduction initiatives, and expanded programming for youth and seniors”.
Small said in a statement he “pledged to be a strong and collaborative partner” with Sherrill. He added that Atlantic City “is on the edge of greatness and the governor now has a deeper understanding of both our opportunities and our challenges”. Sherrill was not quoted in the release.
Big Apple, big competition
Sherrill went more in-depth on New Jersey gaming and the eventual launch of New York City-area casinos in an interview with the Press of Atlantic City earlier this month. She told the outlet that local and state leaders must work together “to see how we can best combat New York [casinos] and keep that economic development and those jobs in New Jersey”. It is critical, she indicated, to spur a more “resilient” and united Atlantic City economy.
“There’s a lot of opportunity, but it feels a little piecemeal right now,” Sherrill said. “It feels like you have a lot of competing interests instead of one goal and one vision that’s going to invest in everyone.”
The exact performance of the three New York City casinos is hard to pinpoint but their potential impact on New Jersey is clear. In Queens, Genting is embarking on a $5.5 billion renovation and expansion of its Resorts World NYC racino, and Mets owner Steve Cohen is partnering with Hard Rock on Metropolitan Park, an $8 billion mixed-used casino complex surrounding Citi Field. Bally’s Corp. is building a $4 billion integrated resort on a golf course it owns in the Bronx.
A mature New York City market will generate between $4.7 billion and $5.6 billion in annual gross gaming revenue post-2031, CBRE estimated in a report this month. That would make it the second-best performing casino market in the US, behind only Las Vegas. New York’s Gaming Facility Location Board estimated last year that the casinos’ tax receipts could top $7 billion from gaming and $5.9 billion from non-gaming in the 10-year period ending in 2036.
For comparison, Atlantic City’s nine casinos generated $2.89 billion in GGR in 2025, with $216.8 million in state taxes.
Divided New Jersey industry
Perhaps the biggest problem for Sherrill, as she alluded to, is an industry divided on multiple issues. One issue that continues to spark debate is the relationship between Atlantic City and the state’s iGaming industry. New Jersey is arguably the iGaming capital of the US, having launched before anyone else in 2013.
Land-based proponents have argued that iGaming cannibalises revenue, while online stakeholders often counter that overall revenue has grown since its introduction. New Jersey has set overall GGR records two years running, and 2025’s record figure of $6.98 billion represented a 10% jump over 2024’s record. That said, the growth of the two verticals has not been equal.
For the first time ever, New Jersey iGaming generated more annual GGR ($2.91 billion) than Atlantic City casinos last year. Additionally, its year-over-year revenue increase was 22%, versus 2.7% for casinos. These trends have continued this year, as online revenue grew another 20% YoY to $251 million in February, compared to $202 million for Atlantic City, which was flat.
In other states that are still debating online legalisation, casino lobbies are becoming increasingly fierce in their opposition. One such example is the National Association Against iGaming, an operator group that has grown in recent years. There are no Atlantic City casinos in NAAiG’s membership but GLPI, which owns the real estate of the Tropicana Atlantic City, is included.
For the land-based sector, New Jersey redirects 5% of online GGR to the city’s Casino Reinvestment Development Authority. Sherrill called this a “great” system in her interview, but it might not be enough to stave off Atlantic City from New York competition or its own online industry.
Rehashing an old idea
The common answer to combatting competition to Atlantic City has been to try and expand casino gaming to the state’s two horse racetracks, Monmouth Park and Meadowlands Racetrack. That idea has been broached several times but has not gained traction. In 2016, state voters soundly rejected a ballot measure seeking such an expansion, but the landscape is different a decade later.
Last May, New Jersey State Senators Vin Gopal and Paul Sarlo introduced SCR 130, another racetrack expansion effort. The bill did not see much activity in 2025 but is facing fresh opposition this year. A coalition of three Congress members and 34 state legislators sent a joint letter to Sherrill and other top brass last week decrying the bill, per the New Jersey Globe.
“We hope that the threatened legislation does not come to a vote. If it does, we will work to defeat it in Trenton and at ballot boxes, just as we did the last time this bad idea was put to a vote a decade ago,” signatories said. “We are not just ‘no’ votes, but ‘hell no’ to expanded gaming in New Jersey.”
In her interview with the Press, Sherrill did not endorse or reject the idea of expansion. But she did reiterate that a splintered Atlantic City makes it difficult to move forward.
“It feels like there are a lot of great ideas … but we’ve seen this before, and it hasn’t worked,” Sherrill said. “It hasn’t worked because it’s like one group wants it this way and then everybody else fights it until it all collapses.”
A referendum in 2026?
The two Democrats, Gopal and Sarlo, doubled down on their efforts earlier this year. Prior to the start of the New Jersey legislature’s 222nd session in January, the state senators pre-filed a constitutional amendment that would establish casino gaming at the two racetracks.
Although Gopal has not specified an upfront licensing fee, he indicated that the state could seek one comparable to New York where the winning bidders were assessed an amount of $500 million each. The resolution proposes that 45% of licence and tax revenues will be dedicated for the funding of property tax relief, with a further 10% dedicated to funding toward the state pension system. In addition, another 10% will be dedicated to provide funding for the support of Atlantic City tourism.
“We’re already doing sports betting on site, we’re already betting on horse racing on site. Gambling is already happening,” Gopal said. “How is this any different?”
In an interview with The New York Times earlier this month, Gopal said he had constructive conversations with Sherill’s administration.
“I would be suspicious if they said ‘yes’ right away, right now,” he added. “We’re going to start the process and give them time to do their due diligence, too.”
The New Jersey legislature can refer constitutional amendments to the ballot, but only 46 measures have appeared on statewide ballots between 1995 and 2024. Gopal, a former chairman of Sherill’s gubernatorial campaign, represents the 11th District of New Jersey, which covers portions of Monmouth County.
Sherrill inherits tax increase
In November, the Democratic Sherrill defeated Republican Jack Ciattarelli to replace the termed-out Murphy, who served from 2017-2025. Murphy’s name is enshrined on the Supreme Court PASPA case Murphy vs NCAA, although that fight originated under former governor Chris Christie. Christie has recently become a spokesman for the American Gaming Association in its fight against prediction markets.
Outside of PASPA, two other big gaming issues under Murphy’s tenure were online tax rates and indoor smoking. Last February, Murphy raised eyebrows in the industry by proposing an increased, unified tax increase for online sports betting and iGaming to 25%, up from 13% from the former and 15% for the latter. Murphy and the legislature settled on a smaller increase which established at unified rate of 19.75% last July.
While the increase was unpopular among industry stakeholders, New Jersey’s online tax rates are still somewhat below other comparable markets. Pennsylvania, for example, levies a 54% rate for online slots, and Michigan levies a graduated rate based on adjusted gross revenue that tops out at 28%. Whether Sherrill will follow Murphy’s lead amid a national trend of tax increases remains to be seen.
Will casino smoking debate settle amicably?
On smoking, Murphy pledged to sign any casino smoking ban that reached his desk, but none ever did. New Jersey law bans indoor smoking at nearly all venues but casinos are granted an exemption.
Proponents of a full ban, including Americans for Nonsmokers’ Rights and the casino workers’ group CEASE, have long cited the negative health effects, but operators have maintained that a ban would impact revenue. The back-and-forth has spilled into the courts for years.
Absent a bill, Murphy largely avoided the issue of casino smoking, but it could become a central issue under Sherrill. As with the other topics, she didn’t endorse a full ban this month, but sought to facilitate a compromise that protects both workers and casinos.
“I think we need a thoughtful path,” Sherrill told the press. “I don’t think a judge needs to direct it, I think the legislature needs to bring the community together, especially our legislators from the Atlantic City area … to get some good results.”
Jess Marquez
Jess has covered the global gaming industry since 2022. A native of Reno, Nevada, he’d like to note that it’s Ne-va-da, not Ne-VAH-da.
Original article: https://igamingbusiness.com/casino/ny-expansion-triggers-nj-casino-battle-2026/
