A bill intended to legalize online casino gaming in New York was recently introduced by New York State senator Joseph Addabbo. The bill, dubbed S.B 8412, if passed will see online casino gaming legalized in the state. Bill 8412 will give the NY State Gaming Commission the power to issue iGaming registrations to any licensed commercial casino in the Empire State.
This Bill will also give any American Indian tribe that has a lawful tribal-state gaming compact iGaming registrations. For the American Indian tribe to qualify for registrations, it must be based in the Empire State and must have implemented a “mobile interactive gaming gambling” agreement with the commission. If a casino or tribal party is registered, they will then be allowed to offer up to 2 separately branded iGaming platforms to their customers.
Under the terms of the bill, the registrants will have the choice to operate iGaming platforms of their own or team up with third-party operators. These third-party operators would be allowed to conduct iGaming operations on behalf of the registrant. Each registrant must pay a fee of $2 million while each 3rd party operator chosen to run the platform will also be required to part with a one-time fee of $10 million.
As is expected, the new legislation will impose a tax on every casino and tribal registrant that will be equal to 25% of the registrant’s gross gaming revenue. The state plans to deposit all of the iGaming tax revenue in the Fund for Education Aid, which is run by the NY State Lottery. The rest of the $11 million will also be distributed by the commission towards programs and campaigns aimed at problem gambling education and treatment.
The bill has already been referred to the Senate Committee on Racing Gaming and Wagering, which is chaired by New York State senator Joseph Addabbo. The State Legislature in New York has until the final day of the current legislative session to approve or do away with the legislation. The current legislative session is not scheduled to end until June 2nd, 2022.
What we cover
A Second iGaming Bill Is Also in the Works
Just recently, a new bill to legalize interactive casino gaming was also introduced to the state’s Assembly. This brings the total number of iGaming bills in New York to 2. This new legislation, dubbed A09436, wants interactive gaming betting platforms to be approved in the Empire States.
Interactive Gaming in this case will cover bets on casino-style games that are made electronically or virtually from any gaming establishment within state lines. If the bill is passed, operators will be allowed to use one or 3 mobile interactive gaming betting platforms, as well as collaborate with brands authorized to produce those games.
If this bill is passed, iGaming operators will have to pay a one-time fee of $2 million. Like in the bill above, independent contractors will also part with a fee set at $10 million. All operators that receive their licenses will have to pay a tax rate that is comparable to 25% of iGaming GGR. At present, New York stands as the largest and most lucrative sports betting market in the country, a spot that was once occupied by New Jersey for years.
The Empire State has emerged as a top mobile sports betting market in just one month of being in business. That’s why Senator Addabbo is convinced that the market is ready to take on iGaming as well. New York has been generating almost $70 million in tax revenue every single month since legalization and there is no reason to believe that iGaming will not be just as successful, if not more.
In January sports bettors wagered approximately $1.6 billion which allowed operators such as BetMGM to hold out close to $124 million. The betting market has so far generated hundreds of millions of dollars in tax revenue for the state, which is needed if the state is going to recover from the economic upheaval that has been caused by the pandemic.
When the New York mobile betting market launched officially this January, only 4 operators were allowed to start processing mobile bets. These included Rush Street Interactive, FanDuel, Caesars Sportsbook, and DraftKings. However, since, an additional 4 operators have joined the market including Wynn Bet, PointsBet, BetMGM, Bally’s, as well as Resorts World.
Many more operators are expected to join the market in the coming months as they look to take advantage of the large population of charged sports fans and punters. So far, the betting market in New York has performed exemplary, as predicted by many supporters during the legislative process. When New York opened its market on January 8th, the total amount wagered in its first 23 days surpasses the monthly handle record of the country, which stood at $1.30 billion.
This record had been set by neighbouring New Jersey, which had grown to become the sports betting mecca of the country until New York’s market came about. Gross gaming revenue in February was slightly lower compared to the first 23 days, but it was still very impressive for a new market.
Flutter-owned FanDuel has been leading the revenue table in regards to handle since the market opened. FanDuel processed $568 million in wagers during the 4 weeks, as well as a gross gaming revenue of $26 million. DraftKings has been trailing closely behind FanDuel with $390 million in handle produced, as well as a revenue of $31.8 million in taxes for the state. Caesars occupies position 3 of the revenue table with $328 million in wagers accepted this February 2022.
Final Thoughts
Not too long ago, the New York market welcomed yet another sports betting operator to the fold. Genting group-operated Resorts World finally entered the mobile sports wagering market in the Empire State by debuting Resorts WorldBet. As more global operators continue to join the market, the Empire State’s performance will likely keep getting better as the market matures. With iGaming and sports betting in place, New York will be unstoppable.
