Uncertainty Surrounds iGaming Legislation in New York
In the complex landscape of New York state politics, the future of online gambling hangs in the balance. Senator Joseph Addabbo Jr.'s proposed iGaming bill, which aims to legalize and tax online casino operations, has not been included in Governor Kathy Hochul's budget for 2025. The omission raises questions about the bill's viability and the governor's stance on the issue as the 2024 legislative session unfolds.
The Proposed iGaming Bill
The legislation put forward by Sen. Addabbo seeks to impose a 30.5% tax rate on revenues generated from online casinos. This move comes on the heels of the successful inclusion of online sports betting in the 2022 budget, which currently endures a hefty 51% tax rate. Proponents of the iGaming bill argue that legalizing online casinos could serve as a boon to state profits, potentially addressing significant budget shortfalls.
However, without the legalization of iGaming, there is concern that New York might continue to lose revenue to other states where such activities are legal, or worse, to illegal gambling operations. The pressure to act is mounting, given the potential financial benefits that could support public services like education.
Lobbying and Legislative Challenges
Not everyone is optimistic about the bill's prospects. Industry lobbyist Steve Brubaker has expressed doubts regarding its passage. He has also hinted at the possibility that last year's legal language, which may have been less favorable to certain industry players, could have been altered to benefit specific companies or service providers like Evolution, a company known for live dealer games.
Brubaker's comments shed light on the often opaque influence lobbyists wield over legislation, sometimes shaping laws to carve out market share for particular businesses. "You see bills 'legislating market share' all the time. It is the primary reason lobbyists exist," he remarked, highlighting the undercurrents of power and influence that drive legislative outcomes.
Furthermore, should the iGaming bill eventually pass, companies interested in entering the market might face the necessity to divest certain interests before applying for a license. This requirement could significantly reshape the competitive landscape within the industry.
Economic Implications for New York
The stakes are high for New York's economy and the gaming industry. Legalizing iGaming could funnel hundreds of millions of dollars into state coffers, funds that Sen. Addabbo and Rep. Pretlow argue are currently being lost to neighboring states or unregulated entities. "At a time of fiscal distress for our state, we cannot continue to allow these funds to slip through our fingers—funds that could further bolster funding for public schools or other worthy services," they jointly stated.
The debate over iGaming reflects broader tensions between economic development and regulatory oversight. While the allure of increased state revenue is compelling, the path forward is fraught with concerns over regulation, fair competition, and the ethical implications of expanding gambling activities.
As the discussion progresses, amendments to the bill could emerge, potentially altering its direction or focus. Brubaker notes, "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." His insights suggest that even if the current iteration of the bill fails, the conversation around iGaming in New York is far from over.
Looking Ahead
The outcome of the iGaming bill will indeed have a significant impact on New York's economy and the gaming industry's trajectory. With Governor Hochul's position on the matter still unclear, and the legislative session ahead, all eyes will be on Albany as stakeholders from across the spectrum lobby for their interests. The path to legalizing online gambling in New York is uncertain, but what remains clear is the importance of the issue to the state's financial and moral landscape.
As legislators weigh the potential benefits against the risks and ethical considerations, the final decision on iGaming will reverberate through the halls of the state capitol and beyond. In the meantime, the industry, lawmakers, and the public await with bated breath to see how New York will navigate this complex and contentious issue.