For more than two years, one critical roadblock rendered claims about mobile sports betting coming to New York State a mere pipe dream. Now that roadblock appears suddenly to have disappeared, and if that’s the case, it turns that pipe dream into likely reality.
A stunning announcement by Gov. Andrew Cuomo published in Wednesday’s New York Daily News has Cuomo doing a backflip on an issue that he previously has opposed on a repeated basis. With Cuomo aboard, the most formidable opposing force would go by the wayside.
“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 tax revenue here at home, which will only strengthen our ability to rebuild from the COVID-19 crisis,” Cuomo said in a statement, according to the report.
“At a time when New York faces a historic budget deficit due to the COVID-19 pandemic, the current online sports wagering structure incentivizes a large segment of New York residents to travel out of state to make online sports wagers or continue to patronize black markets,” Cuomo added.
All of that is true — but it also has been true since June 2018, when Monmouth Park Racetrack and Borgata casino launched legal sports betting in the wake of the previous month’s U.S. Supreme Court ruling that opened the door for all states to offer the Las Vegas-style gambling. That court ruling immediately made sports betting legal in four upstate New York commercial casinos and the state’s tribal casinos as well, because of a 2013 state law that linked such betting to any future federal acceptance.
But even as New Jersey has raked in tens of millions in annual tax revenue from the gambling — with about 90% of it coming from wagering on mobile devices — Cuomo repeatedly had dismissed the idea.
While the staggering $4.98 billion legally wagered in New Jersey in 2020 through November has gotten most of the headlines, the state only takes in about 10% of gross revenues, for a tax haul of $41.8 million.
Cuomo has mocked such a figure, especially during a radio interview in March 2019.
“Sports betting, first of all, does not make you that much money,” he said on Albany’s WAMC radio. “They raised something like $13 million — $13 million is a rounding error in our state [budget]. I am not a fan … [of when] you can bet anytime from your cellphone.”
The Cuomo turnaround — to be addressed as part of next Monday’s annual “State of the State” speech — also is expected to be a pivot away from his previous claims that passage of mobile sports betting in the Empire State first would have to run the gauntlet of a constitutional amendment. That process could take up to three years.
But gaming law attorneys such as Daniel Wallach have pointed out that when New York state began allowing mobile wagering on horse racing, no such amendment process was undertaken.
Was this a trial balloon?
Cuomo just three weeks ago referenced the idea of sports betting in a press briefing, but in such a vague way that it left interpretation quite open-ended.
“Tax increases?” Cuomo asked rhetorically. “At this rate, we’re going to need them. But it’s only one mechanism to close the hole. How much is in tax increases and how much in [spending] cuts?
“Are there other ways to get revenue? How about marijuana? How about sports betting?”
Cuomo then elaborated on the marijuana issue, but not on sports betting, before moving on to other topics.
New York, the fourth-largest state in the U.S., already is the largest to offer legal sports betting — although only at casinos 90 miles or more north of the center of the massive New York City metropolitan region.
That “blind spot” has induced millions to cross the Hudson River into New Jersey, which has approved more than a dozen legal sports betting apps that can be put into use by advanced geolocation as soon as a bettor crosses into the Garden State.
A legislator reacts
State Sen. Joseph Addabbo of Queens has estimated that New York, with more than double the population of New Jersey, can expect to generate at least $100 million in annual tax revenue from sports betting.
Upon hearing about the tabloid report — which as of 10 a.m. Wednesday had not been confirmed by the governor’s office or noted on his social media accounts — Addabbo said the news was “encouraging.”
“By legalizing mobile sports betting,” Addabbo said, “New York will be able to reap the benefits of the economic gains it will create and help the state rebuild after the COVID-19 pandemic, in addition to increasing educational funding, addressing illegal activity in the state, and assisting those with gaming addictions. I look forward to working with the governor and his office to efficiently implement mobile sports betting for the people of New York.”
The state Senate first passed a mobile sports betting bill in 2019, but Assembly Speaker Carl Heastie has heeded Cuomo’s previous direction to table a similar motion — even though Assemblyman Gary Pretlow has long insisted that the votes are there for approval.
If Cuomo indeed no longer is standing in the way, then passage seemingly would be smooth sailing — unless, perhaps, the state’s tribal gaming lobby raises vociferous objections.