The New York State Assembly took a significant step towards legalizing online casino gambling on February 3. The move could generate more revenue than the current mobile sports betting industry. According to New York State Senator Joseph P. Addabbo Jr., legalizing online casino gambling would likely create more gross gaming revenue (GGR) than the nearly $1.4 billion New York sportsbook marketplace did in its first year. Addabbo predicts that online casino revenue will “eclipse” that of sports betting. However, lawmakers need to approve iGaming before it can happen.
State Assemblyman J. Gary Pretlow introduced A3634, allowing retail casinos to partner with two sites, potentially resulting in 14 online casinos. Four Upstate New York casinos currently partner with the state’s nine mobile sportsbooks. A board appointed by the New York State Gaming Commission is vetting applicants for three Downstate New York retail casino licenses. If all seven casinos partnered with two online casino operators, 14 New York online casino sites would be available.
Pretlow, the committee chairman of the bill, has also introduced New York online poker legislation proposing a 15% tax rate. In the New York State Senate Racing, Gaming, and Wagering Committee, the proposed legislation aims to increase the number of New York sportsbooks from nine to 16 while reducing the tax rate from 51% to 25% by 2025.
During a joint public hearing on January 31, DraftKings Sportsbook and FanDuel Sportsbook executives urged New York lawmakers to add iGaming and reduce the 51% tax rate. State Senator Pamela A. Helming raised concerns that online casino gambling could cannibalize the income of retail casinos. However, DraftKings CEO Jason Robins and FanDuel Group President Christian Genetski argued it would bring new customers into the brick-and-mortar casinos.
BetMGM CEO Adam Greenblatt predicted that cannibalization concerns may prevent all US online casino legalization efforts in 2023. Nonetheless, Addabbo has promised a committee hearing soon for lawmakers to discuss New York online casino gambling.