Can NY Casinos Help New York Usurp Atlantic City As Gambling Destination?

Written By Grant Lucas on January 25, 2023

In the relatively near future, New York — specifically the New York City area — could usurp Atlantic City as the gambling and entertainment destination of the northeast.

The state already features upstate commercial casinos. Online sports betting in New York quickly established itself as the No. 1 industry across the country. Soon, downstate casinos will make their way to New York City. And all the Empire State is missing, a piece that America’s Playground/New Jersey still has over its neighbor, could become legal this year.

And should New York online casinos receive authorization — and eventually launch — the state could finally, at long last, top its neighboring rival.

Really, though, those downstate casinos are key. And Sen. Joe Addabbo knows the ramifications for its gambling mecca neighbor.

“I’ve said it before: I’ve been on panels, and I listen when I’m on a panel. And I hear legislators from New Jersey or those representatives of New Jersey say, ‘Hey, if a casino’s coming to Manhattan, we’ll look into changing our constitution.’ Jersey’s nervous about a Manhattan casino. I don’t hear that with any other site. I hear it with Manhattan.”

New Jersey gambling expansion ‘frustrated’ New York legislators

New York City may be considered the City That Never Sleeps, but for decades, Atlantic City has stood as the City That Always Sweeps. As the Empire State stood staunchly against legal gambling expansion, its neighbor in South Jersey established itself as a go-to vacation and gaming destination. Not to mention a wildly popular trope location for film and television. (“You like to gamble? Why don’t we go to Atlantic City? My town.” – Vincent Mancini, The Godfather Part III)

While New York long efforted, though ultimately failed at, legalizing various forms of regulated gambling, New Jersey embraced. The Garden State launched online casinos in 2013. New York sat idly by. New Jersey legalized sports betting in 2012. New York sat idly by. New Jersey fought in courts for six years for the right to offer regulated wagering. New York sat idly by. New Jersey, just weeks after the US Supreme Court repealed PASPA, opened retail sportsbooks, followed a few months later by online sportsbooks. Guess what New York did?

“Angry, frustrated,” Addabbo recalled feeling as New Jersey continued to expand legal gaming. “I’m watching a Mets game and there’s a commercial for Caesars or FanDuel or DraftKings. It’s all about mobile, which, before we had it, you know that’s geared toward a New Yorker who’s watching that commercial and telling them to go to Jersey or to Pennsylvania.

“That bothered the hell out of me. … ‘Why don’t you just drive them over the George Washington Bridge?’ I always criticized Gov. (Andrew) Cuomo at the time when I said, ‘Even if you’re a governor who doesn’t like gaming’ — and obviously he does not — ‘how as a governor do you let this go?'”

Jersey had some part in New York shunning expansion

In the late 1990s, New York appeared on the threshold of legalizing commercial casinos. Plenty of detractors certainly existed within state boundaries. In fact, according to the New York Times, lawmakers were “astonished by the size and aggressiveness of the opposition, who have made the bill’s supporters seem muted by comparison.”

That said, some out-of-state wallets no doubt played a role in the Senate ultimately shooting down the proposal.

In 1997, the state legislature prepped for its deciding vote on a constitutional amendment to authorize commercial casino gaming. That amendment, if passed, would go to voters the following November.

Among many opponents of the proposal: Donald Trump, then an owner of three Atlantic City casinos who spent over $1 million over the previous year lobbying against the amendment. Trump noted that “if gambling happens in New York, it will be very detrimental to my holdings.” Others shared a similar sentiment that commercial casinos in New York would drain money from Atlantic City’s economy.

By the end of January 1997, the New York Senate voted down that bill proposal. The decision was praised by then-Gov. Rudy Giuliani, who noted that the proposed legislation “arbitrarily excludes New York City from participation in legalized casino gambling.” His statement actually alluded to his support of commercial casino legalization, if NYC was included.

“As long as New York City continues to be treated differently than other parts of the State — and not given the same local options as other areas — we will oppose any legislation or referendum that would legalize casino gambling.”

Plenty of New Yorkers take part in NJ gambling

It came as no surprise that, when New Jersey launched online sports betting in fall 2018, New Yorkers pounced all over it.

In the months after the rollout of NJ betting apps, GeoComply noted that approximately 80% of all geolocation hits in the state — which activates when a user attempts to gamble online — occurred within 10 miles of the New Jersey border. What’s more, about 44% of users pinged within 2 miles of the state line. There’s little doubt a similar trend occurs with online casinos in New Jersey.

What that tells stakeholders and lawmakers in the Empire State: New York is funneling money to its neighbor.

“How do you just watch your dollars go? You can’t,” Addabbo said. “Now in these times of post-COVID, you’re looking to create jobs, you’re looking for revenue, you’re not getting help from the federal government, you want to help someone with an addiction. And look at this: iGaming, staring you right in the face. Let’s get it done.”

Added Addabbo:

“The idea here is you can’t let New York stand by on the sideline, like we did prior to mobile sports betting. Sit on the sideline and watch billions of dollars of iGaming go to Jersey, go to Pennsylvania, go to Connecticut, to an illegal black market. You can’t sit on the sideline. This is going to happen. It’s not a question of if; it’s a question of when. So how long are you going wait and let billions of dollars leave your state, jobs leave your state, educational funds leave your state? You can’t. You can’t just sit back.”

New York now on track for payback?

Addabbo doesn’t speak of Atlantic City as a rival, really. Not like the New York Knicks did the then-New Jersey Nets over a decade ago.

Rather, the senator remains focused on the impact downstate casino expansion will have on the state, noting that “the quicker we get to realize the actual approving of these three licenses, the quicker we get to realize the thousands of jobs, billions of dollars in revenue and educational funds, the millions of dollars in addiction programs. We realize none of those benefits until these three are approved and awarded. So we want to get to that point as soon as possible.”

With the downstate licensing process underway, Addabbo emphasized that his goal of legalizing NY online casinos moves back to the front burner. After all, Addabbo said, New York no longer receives financial aid from the federal government as it did during COVID.

“You always look for internal New York revenue,” Addabbo said. “And there is iGaming staring you in the face, an amount of revenue that will really, in my opinion, eclipse that of mobile sports betting. If you’re enamored and amazed with mobile sports betting, wait until New York does iGaming.”

With a sports betting industry that ranks No. 1 nationwide, with downstate casinos coming and potentially the legalization of online casinos in New York, the Empire State could overtake Atlantic City as the top entertainment and gambling destination on the East Coast.

NY casinos pose threat to Atlantic City

Addabbo has sat on panels aplenty. He has heard New Jersey legislators and their representatives voice their opinions on downstate casinos in New York. A common view: “We’ll amend our constitution to allow casinos in North Jersey.”

Some have advocated for a North Jersey casino, including Jeff Gural, owner of Tioga Downs upstate and Meadowlands Racetrack just across the Jersey border. Others have said a casino there would only further cannibalize Atlantic City. (For what it’s worth, in a poll conducted by Fairleigh Dickinson University, the majority of respondents opposed casino expansion outside of Atlantic City.)

As Addabbo has pointed out, “Jersey’s nervous about a Manhattan casino.” The senator pointed to the 2011 debut of Resorts World NYC in Queens. Within five years of the opening of the video lottery terminal, offering only slots and electronic table games, six NJ casinos closed their doors. Certainly other factors contributed to those closures. But Addabbo remains steadfast.

“That’s not a coincidence,” Addabbo said. “In my opinion, in my humble opinion, that’s a direct correlation. Resorts World opened. A very successful racino. And that hurt Jersey. To me, that’s not a coincidence. So you open one in Manhattan, that’s obviously, to me, that’s going to affect the competition in Jersey. And they’re nervous about it.”

Perhaps New Jersey should be. According to a Fitch Ratings study, full-scale casinos in New York City “will negatively affect” casinos in surrounding jurisdictions, “particularly Atlantic City.”

In March 2022, the topic was front and center at a forum in Atlantic City, featuring several area casino executives. And while he pointed out that Atlantic City has time to shore up the industry before downstate NY casinos open, Joe Lupo said four arguably ominous words.

“New York,” the president of Atlantic City’s Hard Rock casino said, “is coming.”

Photo by Shutterstock / PlayNY
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Grant Lucas

Grant Lucas is the senior managing editor for PlayNY. A longtime, award-winning sports writer, Grant has covered gambling and legal sports betting since 2018, when he got his start reporting on the New Jersey and Pennsylvania industries. He now oversees PlayNY as New York expands legalized gambling to sports betting and online casino gaming.

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