New Jersey Lawmakers Move To Block Online Lottery Sales, Prioritizing Retail Partners

Despite changes in consumer habits, New Jersey may be going in a different direction with its lottery. While many states embrace online sales, NJ Spotlight News reports that state lawmakers are taking decisive steps to block the Lottery Commission from selling tickets online or via mobile apps. The conversation in the state capitol is ongoing.

In 2023, New Jersey Lottery officials announced plans to modernize operations by introducing online sales for draw games such as Mega Millions, Powerball, and Pick-6. The proposed policy aimed to attract younger consumers who increasingly rely on digital platforms for everyday transactions like ordering food or paying bills.

Under this model, scratch-off tickets, which account for over half of lottery ticket sales, would remain exclusive to the 7,000-plus physical retailers in the state. 

The proposed changes were set to roll out in the fall of 2024, promising greater convenience for consumers and potentially boosting lottery revenues. However, concerns quickly emerged among state lawmakers and business groups who feared the impact on local retailers that currently sell lottery tickets. 

Retailers push back 

The move toward online sales ignited opposition from influential business groups and lawmakers, leading to the introduction of legislation in early 2024 aimed at prohibiting internet ticket sales. During recent hearings, representatives from convenience stores, gas stations, and grocery stores voiced concerns that online lottery sales could significantly reduce foot traffic, which is vital to their business models. 

“Lottery sales for small businesses have been a cornerstone for the last 50 years,” said Eric Blomgren, executive director of the New Jersey Gasoline, Convenience Store, Automotive Association during testimony, per NJ Spotlight News. Blomgren emphasized that these sales not only generate direct revenue but also encourage purchases of higher-margin items, which are critical for small businesses’ survival. 

For decades, in-person lottery ticket sales have served as a reliable draw for customers, generating additional revenue from the sale of other items such as coffee, snacks, and fuel. Business advocates argued that shifting sales online would strip retailers of this valuable source of ancillary income. 

Lawmakers take action 

Acknowledging these concerns last week, a key Assembly committee unanimously referred the legislation to block the Lottery Commission from implementing online ticket sales. The bill is now over to the Assembly State and Local Government Committee. The decision was framed as a commitment to preserving the status quo and protecting the livelihoods of thousands of small business owners who depend on lottery-related revenue. 

The legislation, A3759, represents a sharp departure from New Jersey’s broader embrace of online gambling. In recent years, the state has legalized online casino gaming and internet sports betting, both of which have brought significant revenue to state coffers. Yet, lawmakers contend that the stakes are different for the lottery, which has a long-standing partnership with brick-and-mortar businesses. 

Business advocates also highlighted the broader economic implications of moving lottery sales online. Mary Ellen Peppard, vice president of the New Jersey Food Council, explained that losing in-person lottery sales would result in a ripple effect for retailers. Customers drawn to stores for lottery tickets often make additional purchases, contributing to the overall profitability of these establishments. 

Balancing modernization and tradition 

The debate over online lottery sales reflects the tension between modernization and preserving traditional business models. While online platforms could offer greater convenience for consumers, lawmakers and advocates argue that the potential harm to local businesses outweighs the benefits. 

Several U.S. states now offer online lottery sales, including Connecticut, Georgia, Illinois, Kentucky, Maryland, Michigan, New Hampshire, New York, North Carolina, North Dakota, Pennsylvania, Rhode Island, Virginia, and Washington DC.

These online lottery sales are different from those offered by lottery couriers, such as Jackpot.com and TheLotter. These two, along with Jackpocket and Lotto.com, are available in New Jersey.

For now, however, the state appears more focused on its network of retail partners, ensuring that the lottery continues to serve as both a source of revenue and a reliable draw for small businesses.