New York has already gone over $1 billion in online sports betting handle — twice.
Through the first 20 days in February, NY online sports betting operators combined for $1.14 billion in handle, leading to $55.2 million in total gross gaming revenue (GGR) and $28.2 million in tax revenue. This is after the industry reported a US-record $1.67 billion in accepted January wagers.
For the week of Feb. 13-20 — the first week after the Super Bowl — online sportsbooks in New York still combined for $354.3 million in handle.
FanDuel NY ($130.6 million) continued to lead in market share, though the platform did suffer a multi-hour outage Saturday. Just behind FanDuel came DraftKings NY ($93.9 million), Caesars NY ($65.8 million) and BetMGM NY ($39.1 million).
“You want that foundation to be rock solid so you can build on it,” Sen. Joe Addabbo told PlayNY.
“Even with a reduction in incentives — which we knew was coming — these numbers are still solid, so I’m pleased. I’m not surprised to an extent — only because of New York’s fan base — but I’m quite pleased to this point.”
What about the 51% NY online sports betting tax rate?
That doesn’t mean everything is perfect.
Concern remains regarding the 51% tax rate on NY online sportsbooks, as they attempt to build sustainable — and, eventually, profitable — businesses in the state.
“I don’t think anyone is making money (in New York) for a long time,” one industry source told PlayNY.
But Addabbo isn’t inclined to make any changes. Not with the state raking in $91.4 million in tax revenues off $2.8 billion in NY online sports betting handle from Jan. 8 through Feb. 20.
“That’s the business they’re in and that’s the terms they negotiated,” Addabbo said. “We’ll always consider everything if it makes the product better for New Yorkers. I just think it is premature to start talking about amending the 51% tax rate. Let’s see.”
One possibility to amend the tax rate would be to bring in four additional NY sportsbooks — going from nine to 13 — which would drop the rate from 51% to 35% based on the matrix issued during the license bidding process by the New York State Gaming Commission.
“If we found out mathematically — and I’ll leave it up to our finance people — by increasing the number of skins, which I always like to do, would decrease the tax rate and yet not affect (tax revenue for) education funding, then I’d certainly be open to that kind of discussion,” Addabbo said.
Local policymakers intent on expanding gaming
Addabbo and Assemblyman Gary Pretlow are continuing to work hard on NY gaming expansion following the Jan. 8 launch of online sports betting. They are attempting to pass a bill that would add fixed-odds horse racing and NASCAR to NY sports betting apps. The bill would also allow for kiosks to be placed at stadiums, arenas and racetracks in the state.
“It really should be in the budget,” Addabbo said.
State policymakers are also trying to get the three downstate casino licenses done, which would generate an additional $2 billion for the state in education funding. And Addabbo has introduced a bill that would authorize iGaming.
Wait continues on player award futures bets
Many online sports bettors in New York have complained about how they can’t wager on player award futures such as the MVP, Cy Young and Rookie of the Year awards, among others. In the Empire State, you cannot wager on any player award that carries a vote.
“It’s funny because I have people that want to bet on the Academy Awards and the Grammys, and maybe somewhere down the line — as long as we can do it safely — I don’t see why not,” Addabbo said. “I don’t see the downside.”
Other states, like neighboring New Jersey, offer player award futures. That could cause New Yorkers to wager elsewhere — including illegal offshore sportsbooks.
“I’m talking horse racing and NASCAR as the next things to be included, and then we can get into the weeds about Cy Young and MVP,” Addabbo said. “We want to be inclusive, but we also want to protect integrity. If, for example, I find out that by allowing people to bet on player award futures it would alter the voting or put an impression on the voting in any way, the answer is no I can’t do that.”
Addabbo wasn’t sure if New York would have to change any language in the regulations for that to happen, if it ever does down the line.
“New York is a different animal — kind of like coming out of the gate in horse racing,” Addabbo said. “We’re that horse that lags behind a little but until the last stretch, and then we just go.
“We’re just giving New Jersey a little head start with Cy Young and MVP. Maybe we’ll get there eventually, jump over them and eclipse them at some point.”