Uncertainty Looms Over iGaming Legislation in New York
In a significant development for the future of online gambling in New York, Senator Joseph Addabbo Jr.'s proposed iGaming bill has been notably absent from Governor Kathy Hochul's 2025 budget plan. The omission raises questions about the bill's viability and the state's stance on expanding its digital gaming footprint.
The Proposed iGaming Bill
The bill in question seeks to introduce a 30.5% tax on online casino revenue, which could potentially unlock a new revenue stream for the state. With online sports betting already making its way into the 2022 budget at a substantial 51% tax rate, proponents of the iGaming bill argue that legalizing online casinos could further bolster state finances, particularly useful in addressing budget shortfalls.
However, with Governor Hochul's recent budget excluding the iGaming proposal, there is speculation that she may not back the bill during the 2024 legislative session. This potential lack of support casts doubt on the bill's future and signals a challenging road ahead for its proponents.
Economic Implications
The stakes are high, as New York risks losing out on valuable revenue streams to neighboring states or illegal operations if it does not embrace iGaming. Industry experts suggest that the legalization of online gaming could significantly enhance state profits, providing much-needed funds for public services such as education.
Senator Addabbo and Representative Pretlow have emphasized this point, stating, "At a time of fiscal distress for our state, we cannot continue to allow hundreds of millions of dollars to be funneled into neighboring states or into the pockets of disreputable companies—particularly when those funds could be used to further bolster funding for public schools or other worthy services."
Industry Perspectives
Despite the potential benefits, industry lobbyist Steve Brubaker has expressed skepticism about the bill's chances of passing. Moreover, he suggests that last year's legal language, which might have favored certain industry players, could have been altered to benefit others, highlighting the influence lobbyists often wield in shaping legislation.
Brubaker's comments reveal the complexities of the legislative process, where bills can serve as vehicles for 'legislating market share,' thus benefiting specific companies. He noted, "You see bills ‘legislating market share’ all the time. It is the primary reason lobbyists exist."
Further complicating matters, should the iGaming bill pass, companies interested in entering the market might need to divest certain interests before applying for a license. This requirement could reshape the competitive landscape and impact how companies approach the market.
Brubaker also speculated on the dynamics within the industry, saying, "Seems like a very light touch for Evolution. Has me thinking that last year’s [law firm] L&W language was replaced with more favorable language by Evo or by the casino companies who use them." His insights suggest ongoing negotiations and strategic positioning among key players in the sector.
While Brubaker does not foresee the bill's passage, he acknowledges the possibility of amendments that could alter its trajectory, hinting at an ongoing battle for control over live dealer segments of the market. "While I do not see this bill passing, it will be interesting to see amendments that may be added to change the direction or focus of what is a battle for control of live dealer," he remarked.
The Road Ahead
As it stands, the future of online gambling in New York remains uncertain. The outcome of the iGaming bill will have significant implications for the state's economy and gaming industry. With so much at stake, all eyes will be on the upcoming legislative sessions to see whether lawmakers will take the plunge into the digital gaming era or maintain the status quo.
For now, industry stakeholders, legislators, and the public alike await further developments, hoping for clarity on the direction New York will take. The debate over the iGaming bill is more than just a policy discussion—it is a reflection of the broader challenges and opportunities that come with the evolving landscape of digital entertainment and the complexities of modern governance.