Democratic New York Governor, Andrew Cuomo, recently made it clear that he remains opposed to any further expansion of gambling in the state of New York despite a recent study which showed New Yorkers spent 837 million in online betting in New Jersey. Despite huge budget shortfalls across the state, the governor will veto any gambling expansion downstate.
Especially concerned with the Governor’s stance are two downstate racinos, Empire City Casino and Resorts World New York City.
The two racinos have offered the state hundreds of millions of dollars in incremental tax revenue in exchange for the full casino licenses that the upstate casinos are entitled to. Currently, the two downstate racinos are only allowed to offer video lottery terminals and electronic table games to its players.
A 3-Year Wait
The state’s 2013 gambling law states that no new casino licenses can be issued until 2023. That law was deliberately implemented to provide four upstate casinos a 10-year exclusivity on gambling. This was to assist the upstate casinos in building up their businesses, and thus, help build up the weak upstate economy.
New Jersey vs New York
However, 2013 was seven years ago, and a few new issues have cropped up since then. First and foremost, the overturning of PASPA in 2018, which essentially opened the door to legalized sports gambling across the country. New Jersey was among the first states to take advantage of this, and has reaped the benefits ever since.
New Jersey quickly expanded every aspect of its gambling industry. As a result, players have flooded into the Garden State from New York City as well as all over downstate New York.
The end result for New York State is, much-needed tax revenue is driving to New Jersey, and placing bets there. Billions of dollars in potential tax revenue is flooding into the Garden State from New York players, depriving the Empire State its due.
Big Casino Operators Support Downstate Gambling
Allowing a few full-scale casinos to operate legally in the greater New York City area would not only bring the state tax revenue, but also create thousands of new jobs. There are estimates the state could generate more than $500 million a year in tax revenue by lifting the licensing ban.
The big casino companies understand the profit potential, and have been lobbying for New York State to lift the moratorium on downstate casinos now. Among the companies lobbying the state is the Las Vegas Sands. For years, the Sands have been lobbying for a full-scale casino license somewhere in the five boroughs.
“The New York City gaming market presents a huge opportunity to generate hundreds of millions of dollars in tax revenue that could be used to revitalize the Metropolitan Transportation Authority as well as supporting local schools,” noted an MGM representative. “It would give New York the opportunity to collect tax dollars that are currently going out of state. MGM and Genting both support the authorization of downstate licensing in order to activate this potential immediately.”
New York Gambling at a Standstill because of Cuomo
Many believe Governor Cuomo has short change the state. Beyond the downstate casino moratorium, Governor Cuomo did not sign any legislation for new tax revenue from gambling in the latest fiscal budget. Online sports betting, another source of tax revenue, was also left out of the budget.
Without a change, until 2023, the state law only allows the four upstate casinos and the tribal gaming venues to operate any retail sportsbooks.
However, the New York Gaming Commission has engaged Spectrum Gaming Group to conduct a thorough study concerning the future of New York’s gaming market and industry.
The first draft of the study will examine the benefits of legalized mobile sports betting. Unfortunately, the initial study review isn’t scheduled until early April, which is after the state’s budget is finalized. While New York gambling expansion is inevitable, don’t expect Governor Cuomo to sign it into law anytime soon.