State Sen. Joe Addabbo couldn’t persuade his fellow lawmakers to authorize New York online casinos in 2023, but his efforts garnered more attention and media coverage than any other iGaming expansion legislation in the country. Already, he’s laying the groundwork to try again in 2024, telling City & State readers that New York “can’t turn down” another billion dollars in online gambling tax revenue.
The Empire State’s immense population and wealth make New York the most coveted state for online gambling operators. New York is also far more realistic a prospect for online casinos than other comparable states like California and Texas, which are still struggling to legalize sports betting.
Unfortunately, the stakes being so high might also make it harder to get a bill through. Lawmakers won’t want to rush anything that important, and lobbying from competing interests will be fierce.
What Happened to the 2023 NY Online Casino Effort?
Coming into 2023, New York was perhaps second only to Indiana on most people’s list of states most likely to legalize online casinos. In both cases, the optimism stemmed from the states’ success with online sports betting and the eagerness of the iGaming industry to lobby for the effort.
Unfortunately, both attempts failed for equally similar reasons. A “poisoned” fiscal note appended to the bill in Indiana raised the familiar bogeyman of retail casino revenue cannibalization. BetMGM CEO Adam Greenblatt and others said they believed the same fears were also to blame, with retail casino unions having been one source of that opposition.
Sen. Addabbo’s 2023 bill would have done more than just legalize online casinos. It also proposed increasing the number of online sportsbook licenses to 16 while reducing the tax rate. Although New York online sports betting has made about $1 billion for the state, there have been some regrets about its implementation. Operators like DraftKings have complained that the 51% tax rate has stifled competition to the state’s ultimate detriment. Pundits have suggested the low cap on licenses has had a similar impact.
Addabbo’s changes sought to rectify the situation. He found support in the Assembly for his proposal from Assemblyman J. Gary Pretlow.
In New York, the best chance for online gambling legislation to pass is to include the language in a budget omnibus bill. Such was the hope for Addabbo’s S1962 and Pretlow’s A3666. However, when lawmakers eventually finalized the 2024 budget on May 2, 2023, it contained nothing about online casinos. Though the bills technically remained active, there was little hope for them passing independently after that ship had sailed.
What to Expect From New York in 2024
Addabbo and Pretlow will be back at it again in the New Year, and their overall strategy will likely be the same: “Budget or Bust.”
The key will be to find compromises to alleviate resistance from other stakeholders. Addabbo has said that his new proposal will once again include an online lottery, which should keep the New York State Gaming Commission on board. It may additionally include $25 million in funding for retail casino workers, whose unions lobbied against the 2023 effort.
Another potential source of resistance would be the Seneca and Oneida tribes, who operate the upstate casinos. The Seneca are in the midst of contentious gaming compact negotiations. They were fighting for approval to build a new casino, although this is now reportedly off the table. The talks will continue into 2024 and their outcome may prove to have an impact on the online casino effort.
Likewise, the selection process for downstate casino licenses continues. Of the most likely contenders, MGM will naturally support any iGaming legislation, but Resorts World has been struggling for market share with sports betting. The third license slot is a wildcard. It could matter whether the winner has a successful online brand or not. A candidate like Caesars would add another retail ally to the state, while one like Sands would become a new opponent.
In the meantime, those question marks might be a problem in their own right. Come budget time, if lawmakers still have questions about the compact and downstate licenses, they may take a wait-and-see approach. That could push the effort back into 2025, despite Addabbo’s warnings about a ten-figure budget hole needing iGaming revenue to fill it.
Key Figures for the 2024 New York Online Casino Push
Sen. Joe Addabbo: Addabbo is undoubtedly the most vocal advocate for online casinos in New York and arguably anywhere in the US. He’s also the chair of the Senate Racing, Gaming & Wagering Committee, and therefore well-positioned to get his proposals to the Senate floor.
Sen. J. Gary Pretlow: Addabbo’s counterpart in the Assembly, Pretlow likewise chairs the Assembly Racing, Gaming & Wagering Committee.
Sen. Andrea Stewart-Cousins: The Democrat and Senate majority leader hasn’t taken an official position on the online casino question. However, she has advocated for MGM to be one of the recipients of a downstate casino license. Given that relationship and MGM’s keen interest in online casino gambling, she is likely a potential ally for Addabbo.
Sen. Rob Ortt: The Republican minority leader in the Senate has voiced approval for the legalization of online sports betting. However, he represents Niagara County, where the Seneca operate a casino, and has been advocating for their side in the gaming compact negotiations. Where they land on the online casino proposal will likely be where he stands as well.
Assemblyman Carl Heastie: The Speaker of the Assembly has taken flak for having failed to bring the Seneca compacts to a vote. The Assembly — specifically, the Munroe County delegation — has been the main source of opposition to the new Seneca Casino. It’s not clear where Heastie stands on online casinos, but his involvement with the tribal negotiations will make him an important figure. He has also shown himself to be listening to union voices when it comes to upstate casino construction. So if those groups remain opposed in 2024, that may make things more difficult in the Assembly.
More States to Watch in 2024
Bonus News Managing Editor Alex Weldon created several forecasts for States to Watch in 2024.
Check out the other installments:
- States to Watch in 2024: New Hampshire — Another iGaming Monopoly in the Making? *
- States to Watch in 2024: Maryland — Is an Online Casino Referendum on the Horizon?
- States to Watch in 2024: Illinois — Will the Internet Gaming Act Progress or Continue to Gather Dust?
- States to Watch in 2024: Rhode Island — How Much Will Bally’s Monopoly Be Worth?
- States to Watch in 2024: Iowa — Time to Stop Flying Under the Radar?
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