Understanding the Stakes: New York's iGaming Bill in Limbo
The much-debated iGaming bill, spearheaded by Senator Joseph Addabbo Jr., has notably been excluded from Governor Kathy Hochul's 2025 budget proposal. This omission suggests a rocky path ahead for the legislation that aims to legalize and tax online casino operations at a rate of 30.5%. With the governor's apparent lack of support, the bill's future during the 2024 legislative session hangs in the balance.
New York has already seen the inclusion of online sports betting in its 2022 budget, carrying a hefty 51% tax rate. The move was a strategic one, aimed at bolstering state revenue through the burgeoning digital betting industry. However, as the conversation shifts toward the broader scope of iGaming, the stakes are high for New York's economy and gaming sector.
Economic Implications and Industry Dynamics
The potential economic benefits of legalizing iGaming cannot be understated. Proponents argue that it could significantly increase state profits and provide a solution to budget shortfalls. Without the legalization of iGaming, New York risks losing substantial sums to neighboring states where such activities are legal, or worse, to illegal operations that offer no consumer protections or fiscal advantages to the state.
Industry lobbyist Steve Brubaker has expressed skepticism regarding the bill's passage. He points out that companies may need to divest certain interests before they can apply for a license, should the bill become law. Furthermore, he has raised concerns about changes to last year's legal language, suggesting that these modifications might have been made to benefit specific industry players—a common practice in legislation influenced by lobbyists.
Brubaker's insights highlight the complex interplay between lawmakers, industry stakeholders, and lobbyists who often shape legislation to favor particular companies. This dynamic is especially relevant in the context of live dealer games, which are at the center of the current debate on iGaming legislation.
Perspectives from Key Players
Senator Addabbo and Representative Gary Pretlow have been vocal about the urgency of passing the iGaming bill. They emphasize the detrimental effect of ignoring the potential revenue stream, 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."
Brubaker also remarked on the subtleties of the bill's impact on specific market segments, noting, "Seems like a very light touch for Evolution. Has me thinking that last year’s [legislative] language was replaced with more favorable language by Evo[lution Gaming] or by the casino companies who use them." His comments reflect the notion that legislative nuances can significantly affect market leaders and innovators within the industry.
He further explains the rationale behind the legislative push and pull, saying, "You see bills ‘legislating market share’ all the time. It is the primary reason lobbyists exist." This candid acknowledgment underlines the reality that behind many pieces of legislation are concerted efforts by interest groups to secure advantageous positions for their clients.
Despite his doubts about the bill's success, Brubaker acknowledges the potential for changes that could alter the legislative landscape, stating, "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."
The Uncertain Future of Online Gambling in New York
The trajectory of online gambling in New York remains uncertain. The exclusion of Senator Addabbo's iGaming bill from the governor's budget proposal is a significant setback for advocates of legalized online casinos. Yet, the conversation around this issue is far from over. As the state grapples with financial challenges and looks for innovative solutions, the role of iGaming as a potential revenue source continues to spark debate among legislators, industry experts, and concerned citizens alike.
The outcome of this legislative effort will undoubtedly have a profound impact on New York's economy and the future of its gaming industry. Whether the state will embrace the opportunity to expand its legal gambling offerings or maintain the status quo is a question only time—and the intricate workings of the legislative process—will answer.