The sports betting world received a jolt this week when New York governor Andrew Cuomo announced his support for mobile sports wagering in the Empire State. A long-time opponent of expanded gaming laws, Cuomo’s 360 degree turn on sports betting significantly brightens the outlook for the industry in America.
With almost 20 million residents, New York is the fourth largest state by population and is home to loads of gamblers, many who cross into New Jersey to place legal sports bets.
Response to COVID-19 Budget Deficit
The coronavirus pandemic has cratered individual state budgets across America. Governor Cuomo explicitly tied his newfound support for mobile betting to New York’s estimated $15 billion budget hole for 2021. While estimates for revenue generation vary widely, taxing regulated mobile sports betting is part of a suite of options for tapping into new sources of revenue. It is possible New York could become a model for other states looking for ways to shore up their own finances.
“New York has the potential to be the largest sports wagering market in the United States, and by legalizing online sports betting we aim to keep millions of dollars in revenue here at home, which will only strengthen our ability to rebuild from the COVID-19 crisis,” says Governor Cuomo.
Previous Sports Betting Legislation Failed
New York has allowed sportsbooks at its four full-service commercial casinos and some tribal casinos since the Supreme Court allowed states other than Nevada to regulate sports betting in 2018. However, none of the commercial casinos are convenient for New York City residents and gamblers in America’s largest city need only cross the Hudson River into New Jersey to wager. It has been clear that New York is bleeding tax revenue to its neighbor, with one study revealing as much as 20% of New Jersey’s sports betting handle comes from New York residents.
Various New York legislators have been proposing expanded online gaming laws for the state since 2013, only to meet resistance, chiefly from Governor Cuomo himself. With Democrats expanding their majorities in Albany during the 2020 elections, the governor’s new plan could theoretically be fast-tracked into law.
Cuomo Wants the Gaming Commission to Run Sports Betting
Contrary to the majority of the fourteen states currently offering mobile sports gambling, Governor Cuomo’s plan calls for the New York State Gambling Commission to run mobile wagering. Currently, only Oregon, New Hampshire, and Rhode Island use their lottery commissions to run sports betting. According to New York officials, having the Commission operate gaming would increase tax revenues tenfold over allowing casinos to control sports betting themselves.
Cuomo’s plan calls for any potential operators to partner with one of the state’s four existing commercial casinos to offer a statewide betting platform. It remains unclear if New York will only issue one license, which would grant the operator a monopoly on mobile betting. Though the governor addressed only a single license in his press conference, it may make more sense to auction at least four licenses – one for each potential casino partner.
No Plan for Online Casinos or Poker in New York
One drawback to Governor Cuomo’s announcement is its limitation to online sports betting. There is currently no discussion of regulating non-sports online gambling in New York. Unlike its neighbor Pennsylvania, where online table games, slots, and poker were recently all licensed and regulated, it appears only online sports wagering is moving forward in New York. While it is always possible legislators will lobby for more expansive online gambling legislation, without the governor’s backing such a proposal may be doomed. Still, Cuomo’s support for online sports gambling is a welcome turn of events.
