Legal Cannabis Unlikely to Impact Atlantic City Casinos

New Jersey has legalized the recreational use of marijuana, but that’s unlikely to significantly impact the local gambling industry.

New Jersey Legalizes Cannabis

On November 3, the US State of New Jersey approved a Legislature bill that legalizes cannabis use. Currently, cannabis is legal only for medical use but recreational use will also be legalized from the very beginning of the coming year. The bill passed with 67% voter approval.

The State’s decision means that a taxable, regulated cannabis industry will emerge in the state. However, it is unlikely that the legalization of cannabis will have any substantial impact on visitor experience in any of Atlantic City’s nine casinos.

According to industry consultant and former Casino Control Commission spokesperson Dan Heneghan, Atlantic City’s casinos have been aware of the then-illegal use of cannabis in their establishments, but simply decided to not take action. The new bill would not change much, in that sense.

The Casino Association of New Jersey has not commented on the bill so far, given that it has not been finalized yet.

How Will the Industries Coexist

According to Sen. Nicholas Scutari, lawmakers have not given special consideration to the bill’s impact on gambling. Mr. Scutari, who spearheaded New Jersey’s recreational cannabis bill, stressed that the expectation is that the drug will largely be treated similarly to other recreational substances, such as tobacco or alcohol.

In regard to how and where visitors will be permitted to smoke marijuana, Mr. Scutari believes that the same restrictions would apply as with cigarettes. Non-smoking rooms would prohibit the consumption of cigarettes and marijuana, while smoking rooms would allow the use of both. However, he noted that the bill itself does not prohibit the use of marijuana.

Furthermore, the Senator stated that it is so far unclear who would decide how the two industries interact – the Cannabis Regulatory Commission or the state gambling regulators.

Tried and True

Recreational cannabis use is legal in a number of states. One example of this is Nevada. Marijuana has been legal in Nevada for over three years, but casinos systematically avoid accepting pot. In fact, smoking lounges are prohibited from opening up within a 1,000 feet diameter of any casino.

The reason for this aversion is the fact that marijuana is still illegal under federal law, which creates a number of challenges and complications for the industry. This includes anti-money laundering provisions, employee protections, banking laws and more.

Lloyd D. Levenson Institute of Gaming, Hospitality & Tourism coordinator Jane Bokunewicz believes that the Atlantic City casino scene will likely adopt a similar stance to that of Nevada and not openly embrace the recreational use of marijuana. At least until the drug attains mainstream acceptance.

This sentiment is shared by former Atlantic Casino CEO Robert Ambrose. Mr. Ambrose does not expect casinos to openly support smoking or selling cannabis on site as the drug is still a significant business liability.

“A great deal would have to change on the regulatory side at both levels before that happens”, he noted.