New York Reaches Budget Reconciliation With Downstate Casino Licenses Baked In

Written By Derek Helling on April 11, 2022
Acccelerated Casino Licenses Budget Is Final In New York

It took longer than many might have hoped, but late is definitely better than never for New York casinos. The final version of the New York budget for the fiscal year starting in 2022 gives them exactly what they wanted.

The licensing for up to three new downstate casinos will start nearly immediately instead of next year. The budget also lays out the path for two of the licenses and starts what should be a fierce bidding war for the third.

New York budget bills become law

More than a week past the annual deadline of April 1, both chambers of the legislature in Albany passed budget bills late Friday night. On Monday morning, Gov. Kathy Hochul signed the necessary bills into law.

There are multiple ramifications of this reconciliation for the gambling industry in the state. They all pertain to new commercial casinos in the southern parts of the state.

First, the owners of the Empire City Casino in Yonkers and Resorts World New York City in Jamaica (Queens) can start looking toward expansion. Those Class II facilities are now in line for a shiny, new Class III license.

The legislation does not guarantee a li cense for those two facilities. However, New York Assemblyman Gary Pretlow told Mike Mazzeo of sister site PlayNY that he believes both properties would have no issues obtaining them.

That will mean New York can add retail sports betting, poker, and table games to their video lottery terminals. Whether the casinos will add other amenities or expand in other ways is uncertain right now. As their renovations are ongoing, the New York State Gaming Commission will have other businesses to attend to.

One new casino likely coming to New York City

A bidding process could start soon for the final Class III license in New York. The NYSGC can put out a request for applications as soon as it’s ready now. Before these bills became law, they had to wait until next year to do so.

The new legislation sets the reserve for the bidding at $500 million. The licenses will be good for at least a decade but no more than 30 years. The law sets the floors for revenue sharing as well. Bids must start at 25% for revenue from slot play and 10% for all other gaming revenue.

Additionally, a site review board will assist the Commission in selecting a winner for the seventh license. That might be the Commission’s first action, as the law gives its just 180 days to appoint all six members. By law, those members cannot be state legislators or other people who have been elected to a state-level office.

It’s uncertain right now who might sit on that board. What seems a foregone conclusion, though, is that the casino will likely be somewhere in the New York City metro. Because of that location, some of the world’s largest gambling companies have already shown interest.

Quartet of NY casino operators in – will there be more?

So far, four companies that operate casinos in other US states have confirmed their interest or been rumored to have an interest in the final New York commercial Class III license. That list includes:

  • Bally’s
  • Hard Rock
  • Las Vegas Sands Co.
  • Wynn Resorts

There has been international interest as well. In December, UE Resorts, a subsidiary of Japanese Universal Entertainment Corporation, submitted plans for a casino in Manhattan. Since the state has reduced the licensing wait, others might join the fray.

Sites associated with the known potential bids include plots of land near Belmont Park in Long Island and close to Citi Field in Queens. Other parties like Hard Rock have not yet shared any details about possible locations.

While the state will issue a license to a final bid winner, municipal leaders will hold sway over the site for a future NYC casino. That’s where the situation gets murky when looking ahead.

New York City officials might oppose new casino

About a year ago, Manhattan borough president Gale Brewer clarified her sentiments.

New York Senator Brad Hoylman, whose district covers the same area, also spoke on the issue in February to Joseph Spector of Politico.

“My concern, representing Manhattan and Times Square is the neighborhoods which would be adjacent to any proposed casino and the impact. Casinos can have negative externalities, to put it mildly,” Holyman stated.

“I oppose them strongly and generally have done so in the Legislature. When it is in my Senate district, it is even a greater concern.”

To finalize their bids, potential casino operators will have to navigate these relationships. Also of note for residents is what this year’s New York budget bill doesn’t contain. Other forms of gaming expansion were in the mix earlier.

What about online casinos and more sportsbook licenses?

Earlier in the session, both Pretlow and NY Sen. Joseph Addabbo introduced bills to legalize online casino play in New York. While those bills are still stand-alone pieces of legislation, they are not in this final budget.

Additionally, neither Addabbo nor Pretlow plans to push for their passage during this term. A separate item came closer to making the cut for this budget. That was an expansion of the number of licenses for NY online sports betting.

It’s hard to blame Addabbo and Pretlow for proposing an expansion to online sports betting in New York. The market has been strong so far, just missing setting yet another record for betting handle in March. During the month, bettors put down over $1.6 billion.

Since legal online sports betting apps launched in the Empire State in January, the state has collected around $151.7 million from its revenue-sharing agreement with the sportsbooks. That’s a record in and of itself and remarkable in such a short period of time.

In earlier versions of the budget, some proposals would have added as many as seven additional licenses by 2024. Currently, there are nine. In the end, though, leaders in Albany decided not to fix what isn’t broken. Addabbo told Matthew Waters of Legal Sports Report as much.

“It turns out that you don’t tinker with something that’s successful and it may be premature [to add licenses],” Addabbo said.

“So we threw it out there, we looked at it, we analyzed it a little bit and said, ‘You know what, it may be premature. So let’s do this, let’s take a look at this maybe six or seven months down the road and see what happens.”

Addabbo’s words obviously leave intact the possibility that the state might again look at gambling expansion in the New York state budget for a third consecutive year in 2023. If that ends up being the case, it will likely come after the state issues a new round of commercial casino licenses.

Photo by Thiago Leite /
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Derek Helling

Derek Helling is the assistant managing editor of Playin USA. Helling focuses on breaking news, including legislation and litigation in the gaming industry. He enjoys reading hundreds of pages of a gambling bill or lawsuit for his audience. Helling completed his journalism degree at the University of Iowa.

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