Could New York Green-Light Downstate Casinos? Lawmaker Says ‘Strong Possibility’

Written By Matthew Kredell on December 11, 2020 - Last Updated on September 13, 2022

Online sports betting would give New York a little spending money, but expediting downstate casinos could put a real dent in the state’s budget shortfall.

That’s why Sen. Joseph Addabbo Jr. told PlayNY that he thinks there is a “strong possibility” two downstate casino licenses make a revenue bill alongside the authorization for mobile wagering.

“Certainly the easier lift is mobile sports betting, but the money you need is with the two licenses and the jobs they create,” Addabbo said. “So I would hope those two licenses really are part of this revenue package.”

New York state and local governments face an approximate $59 billion shortfall this year and next. The downstate casinos would provide a minimum of $1 billion in license fees.

Background on New York casinos

The Upstate New York Gaming and Economic Development Act of 2013 authorized New York to license up to seven commercial casinos.

This started with four upstate commercial properties— RiversTioga DownsResort World Catskills and del Lago. Tribal casinos are also scattered across the upper half of New York.

To spark economic development, the state established a seven-year moratorium from the opening of the first casino to licensing for downstate casinos. This head start ends in 2023.

Existing casinos are in favor of ending the moratorium early, as they are entitled to recover license fees if other casinos are licensed before 2023.

Two properties ready for downstate casino licenses

Two racino properties in the New York City area have expressed interest in becoming full casinos — MGM Empire City in Yonkers and Resorts World in Queens.

Currently, they may only offer only video lottery terminals and electronic table games. As licensed casinos, they could expand to slot machines, live dealer table games and sports betting.

In committee hearings, they said they would be willing to pay $500 million each for a license, along with paying off the fees of existing casinos.

In his budget recommendation earlier this year, Assemblyman Gary Pretlow recommended charging them each $700 million. Addabbo said the price tag would be for the governor to figure out. New York can hold the remaining license for future casino construction.

Addabbo noted that transforming the racinos into full casinos would also create an estimated 3,000 jobs at a time when New York faces high unemployment as a result of the pandemic.

NY governor ‘dubious’ of downstate casinos

New York Gov. Andrew Cuomo dismissed prior talk of expediting the casino licenses.

Perhaps that’s why Pretlow previously told PlayNY that the downstate casino licenses don’t have the same momentum as online sports betting in revenue bill discussions.

But Addabbo said he and Pretlow had a call Thursday, during which they discussed continuing to advocate for the two licenses in addition to mobile sports betting.

“It’s a dire situation here,” Addabbo said. “We’ll go to our respective colleagues and try to explain that these are drastic times that call for drastic measures. How long can we continue to wait when we’re looking down the double-barrel of a $50 billion deficit caused by the pandemic?”

The state faces economic woes and two existing gaming licensees in the state are ready to convert. Addabbo doesn’t see why New York would wait.

“If those licenses sit on the shelf until the year 2023, they’re collecting dust and doing nothing to provide revenue and jobs,” Addabbo said. “We’re in a situation as a state where we don’t have the luxury of declining that revenue that is realistic and substantial.”

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Matthew Kredell

Matthew Kredell reports on efforts to legalize sports wagering and online casino gaming around the country. He covered the multi-year effort to legalize online sports betting in New York from the beginning. He talks to state lawmakers, lobbyists and industry representatives to get the scoop on new gambling developments in the Empire State and was at the forefront when the state budget included the authorization of legal online sports betting in 2021. Matthew has covered the legal gambling industry since 2007, getting into regulated sports betting three years later. An alum of USC, Matthew began his career as a sportswriter at the Los Angeles Daily News. He has also contributed to publications that include Playboy, Men’s Journal and ESPN.

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