Wednesday has been a roller coaster for those interested in the New York gambling industry.
And Gov. Andrew Cuomo is at the controls of the ride, powered by his apparently evolving position on online sports betting in the Empire State.
Cuomo will recommend legalizing online wagering in his forthcoming budget proposal. While that represents a significant shift in his position, the details of his proposal may leave much to be desired.
What is Gov. Andrew Cuomo proposing?
Before getting into the weeds of Cuomo’s plan, it’s worth taking a moment to reflect on his progress on this topic.
For years, Cuomo has been one of the biggest roadblocks to getting this done. As a matter of fact, just over a year ago, Cuomo called legalizing online wagering an “irresponsible revenue source to solve a problem which doesn’t really exist.”
The governor insisted the only path to legalizing sports betting online in New York was through a constitutional amendment. Because he was likely to veto any bill that sought to authorize it by any other means, most of those proposals went nowhere in the state legislature.
However, it seems the need to recoup tax revenue lost during the COVID-19 pandemic has changed his tune.
Cuomo takes new stance on NY mobile betting
A New York Daily News report on Tuesday quoted Cuomo citing the state’s budget deficit as his rationale for pushing for a new statute to legalize online sports betting.
On Wednesday, the New York State Gaming Commission acted at Cuomo’s direction. It released the following statement:
“Governor Andrew M. Cuomo today announced legislation to authorize mobile sports wagering as part of the 2021 State of the State. Under Governor Cuomo’s proposal, the New York State Gaming Commission will issue a request for proposals to select and license a sports operator or platform to offer mobile sports wagering in New York. This operator or platform must have a partnership with one of the existing licensed commercial casinos. The Commission will also require any entity operating mobile wagering apps include safeguards against abuses and addiction.”
Essentially, the commission is now taking bids from operators for a contract to provide legal online sports wagering in New York. Whichever party wins the bid would effectively have a monopoly on that category of gambling in the state.
That will be part of Cuomo’s larger budget proposal for the year to the legislature. The operative word that all New Yorkers should note is “proposal.”
So what happens now?
Like any other part of any other budget proposal, the legislature has the final say. Even within his role as governor, Cuomo can’t unilaterally make this change.
Both the state Assembly and Senate will have to agree. Cuomo clarified some details on his proposal in a press conference Wednesday, laying out his vision for the system.
“We want to do sports betting the way the state runs the lottery where the state gets the revenues,” Cuomo said. “Many states have done sports betting but they basically allow casinos to run their own gambling operations. That makes a lot of money for casinos but it makes minimal money for the state.
“And I’m not here to make casinos a lot of money. I’m here to raise funds for the state. So we have a different model for sports betting.”
Could Cuomo’s proposal work?
Because online sports betting in Cuomo’s proposal would run through the lottery, there are questions of constitutionality. Even if the legislature were to pass his proposals in their current forms, they could face immediate and ultimately successful court challenges.
Additionally, there are doubts as to whether a single-operator system, whether tied to casinos or the lottery, would produce the revenue for the state that Cuomo imagines. All the most lucrative markets in the country for online sports betting have multiple operators in competition with each other.
Cuomo’s proposal of legalizing online sports betting without an amendment to the state’s constitution is a remarkable about-face on his part. Whether his proposal has any legs as it stands right now, and whether it would be good for the state if it does become law as is, is up for debate.