New York Online Casino Bill Could Fortify Online Sportsbook Operators
A New York online casino bill could perhaps incentivize online sportsbook operators to maintain their commitment to the state.
Sen. Joe Addabbo’s SB 4856 allows existing New York online sports betting operators to qualify for online casino licenses.
Previous attempts at legalizing New York online casino limited licensing to the state’s seven casinos and three Indian gaming tribes.
Addabbo told Playin USA that the online operators who have made New York the top state for sports betting revenue are an important part of generating support for New York online casino.
“We’ve got to get the governor and other legislators to have an appetite to do this. If online operators want this, I need them to weigh in through media outlets and really directly with the governor. I need them to say we want to do business in New York.”
A representative of Asm. Gary Pretlow tells Playin USA that he will update AB 3634 to match Addabbo’s bill. He refiled a previous NY iGaming bill in AB 3634 but has worked with Addabbo on the new language.
Details of New York online casino bill
Here are the main details of SB 4856 and how they compare to previous New York online casino language:
- 30.5% tax rate (up from 25%). Unlike sports betting, operators can write off promotional credits.
- Mobile interactive gaming licenses cost $2 million for 10 years.
- Potential for up to 29 licenses: four upstate casinos, three future downstate casinos, three Indian tribes, eight VLT racinos (two of which are likely to convert to casinos), eight online sportsbooks, three competitive bids with minority participation.
- Allows only one skin per licensee (down from two when licensees were more limited).
- Increases jobs in New York with live dealer games that must be conducted in the state.
- $11 million annually for the purposes of problem gambling education and treatment.
“The real thrust or purpose of this bill is the revenue for education and funding of addiction programs,” Addabbo said. “I’m bothered when we lose money to other states and the illegal market. And we want to be able to identify and help someone with addiction by regulating this in New York. I also see this as an opportunity to help brick-and-mortar casinos that suffered from two years of COVID-related declines.”
How online casino could help NY sportsbook operators
DraftKings CEO Jason Robins and FanDuel President Christian Genetski warned that they might need to take drastic measures such as offering worse betting odds to New Yorkers to continue operating in New York.
New York lawmakers pushed back at the operators, whose arguments didn’t register when they agreed to enter the market at this rate and New York online sports betting has been highly successful. New York broke records in its first offering online sports betting.
Even Addabbo, who introduced a bill to lower the sports betting tax rate to 35% with an additional four operators, expressed his skepticism.
Addabo said that the legislature will continue to consider lowering the online sports betting tax rate independent of online casino. But online casino could be a way to solidify the operations of sportsbook operators without changing the agreed-upon tax rate.
Robins did make a pitch for New York online casino at the sports betting hearing.
Could New York online casino make budget?
Addabbo admitted that iGaming faces an uphill climb to make the next New York budget. Gov. Kathy Hochul did not include online casino in her executive budget.
Lawmakers in each chamber will work in the coming weeks to come up with their own one-house budget proposals and align them with each other and the governor. The final New York budget is due April 1.
Spectrum Gaming recently issued updated online casino and online poker projections for New York of $2.3 to $3.1 million in gross gaming revenue in year one, increasing to $4 billion by year five.
Addabbo said the effort to add iGaming in New York would start soon with a roundtable discussion in his Senate Racing, Gaming and Wagering Committee.
“Every year we don’t do it, we lose $1 billion of our money to another state and an illegal market, which is really a problem because we find out many illegal markets have ties to terrorist states. If we really want to help people with addiction and keep revenue in New York, we should talk about legalizing iGaming this year. I hope my voice is joined by other voices to try to get it in the budget.”