After years of wrangling, online New York sports betting is officially signed and sealed. When it will be delivered remains another matter. Governor Andrew Cuomo signed a fiscal year 2022 state budget that contains provisions regulating online wagering.
Details of Gov. Cuomo’s betting deal, which is not as much of a compromise as originally thought, limits operators. At launch, New Yorkers will likely only have two options for placing regulated wagers. Despite the Governor’s numerous current scandals, he successfully strong-armed lawmakers into accepting his more tightly-controlled plan.
What Is New York’s Gambling Plan?
New York will initially offer only two platform provider licenses for online sports betting operators. These companies will pay a one-time fee of $25 million for the right to host betting servers at one of New York’s casinos. Subsequent years cost a $5 million platform provider renewal fee.
All the numerous online operators who apply for licenses will need to partner with an existing upstate casino. Some of the larger operators are better positioned, as they already run retail sportsbooks within a New York casino. Look for New York based FanDuel to be a prime competitor for one of the platform provider licenses.
Gamblers will be allowed to bet on collegiate games, including those that take place in New York. However, no bets will be taken on matches involving New York colleges or universities. This solution keeps Madison Square Garden a viable site for conference basketball tournaments and other large NCAA events.
The signed FY 2022 budget includes a maximum tax rate of 13% on New York sports betting operator revenue. Gov. Cuomo’s plan was supposed to be more lucrative for the Empire State. The limited amount of licenses was intended to be offset by higher tax rates. Compare this with New Hampshire, where DraftKings pays a 51% tax rate for a regulated monopoly. Somewhere during the legislative debate, the higher tax rate disappeared.
When Will Online New York Sports Betting Launch?
The application process for determining who receives the initial two platform provider licenses will begin in June. By July 1, the state will stop accepting new requests for licenses. Then, the law includes a 150-day period during which the state will select the best applicants.
This timeline puts the earliest online New York sports betting launch close to the end of 2021. Longtime gambling proponent State Senator Joseph Addabbo Jr. (D-Queens) hopes for bets during football season. However, he stated the 2022 Super Bowl is the most significant milestone. He hopes New York will officially be taking bets by then. If not, bettors will continue boosting New Jersey’s mobile market by crossing the Hudson.
One possible hitch in the rollout of online regulated betting remains. New York compacts grant Native American Tribes the exclusive right to offer gambling in parts of the state. Unless the government agrees to updated agreements with the Tribes, lawsuits are possible. Any litigation could delay the start of regulated online New York sports betting.
