Senator Joseph Addabbo Jr. is set to re-introduce a bill regarding iGaming in December before the legislative session resumes in January 2024. The senator serves as New York’s Chairman of the Committee on Racing, Gaming, and Wagering. Online gambling could bring in over a billion in revenue for the state of New York. With a projected budget shortfall of $36 billion over the next three years, this revenue could help to fill the gap.
Losing business across state lines
Seven U.S. states already allow iGaming. Some of these are New York’s neighboring states of Pennsylvania and New Jersey. The revenue brought in by online casinos in New Jersey in 2023 has already exceeded $1 billion. Pennsylvania has also done extremely well.
New York doesn’t want to lose business across state lines. The success of mobile sports gaming in New York has led to discussions about permitting online casino gaming – also known as iGaming. This will allow online games to be played from a mobile device. The bill Sen. Addabbo is sponsoring will cover launching online casino gaming and will include peer-to-peer poker.
Possibility of a multijurisdictional compact
Sen. Addabbo is looking at state-to-state tournaments and not just in-state tournaments. The wording of the bill could possibly allow the state to enter into a multijurisdictional compact. Michigan signed a multijurisdictional poker agreement in 2022. This agreement allows internet poker players in the state to compete against players in New Jersey, Delaware, and Nevada. New York State has nearly 20 million people. It could be a major participant in any Multi-State Internet Gaming Agreement.
Expansion of sports betting
Another area that could be affected by the push for iGaming is sports betting. Sports betting was technically legal in New York long before it actually came into effect. It took until January 2022 to set up operations and regulations. The current law allows for nine online sportsbook operators.
During the next legislative session, increasing the number of online sportsbook operators could happen. Business planning for online sports betting will also involve looking at online sports betting tax. There’s a possibility that it could be reduced from the current 51%. Sports betting is one of the fastest-growing segments of online gambling.
The right time for iGaming
The iGaming market size is growing rapidly, and Sen. Addabbo believes that it’s the right time for it. Mobile sports betting is already very popular in New York, and he believes it makes sense to build on that. The poker segment shouldn’t be forgotten either.
Sen. Addabbo says he hopes lawmakers will take into account the poor fiscal situation the state is going into next year. The proposed tax on online casinos is 30.5%. This could generate approx. a billion dollars in revenue in the first year. Lowering the tax rate could foster more competition and give consumers more choice.
Effect on brick-and-mortar casinos
Sen. Addabbo believes the proposal won’t hurt brick-and-mortar casinos. It will give them a way to expand the gaming they already offer. This has been the case in other states that offer online gaming. Other lawmakers are convinced that land-based casinos will suffer from the introduction of iGaming and more accessible gaming will cause more addiction problems.
Approving iGaming
Approving iGaming is not always an easy vote for state lawmakers despite the apparent financial benefits. They often have concerns about responsible gaming and consumer protection. It often takes time and educational efforts to convince them it’s the right move. Sen. Addabbo hopes that Gov. Kathy Hochul will seriously consider the proposal and its revenue-generating potential in the new year.