State of iGaming Legislation in New York
New York's journey towards the legalization of online gambling, commonly referred to as iGaming, has hit a stumbling block. The anticipated bill spearheaded by Senator Joseph Addabbo Jr., which could potentially usher in a new era for internet-based casino games, was conspicuously absent from Governor Kathy Hochul's proposed budget for 2025.
The bill, which suggests a 30.5% tax on revenues generated from online casinos, seems to lack the gubernatorial support necessary to be woven into the legislative fabric during the 2024 session. This comes as a surprise to some, given that online sports betting was successfully included in the state's 2022 budget, albeit with a notably higher tax rate of 51%.
Economic Implications
Proponents of the iGaming bill argue that the legalization of online gambling is not just about expanding gaming; it's about economic recovery and growth. They point out that legalizing iGaming could substantially increase state profits and help alleviate budget deficits. Without such legislation, there is a concern that New York will continue to lose potential revenue to neighboring states where iGaming is legal or to illegal operations that operate outside the purview of state regulation and taxation.
The stakes are high, as the outcome of this bill carries significant implications for New York's economy and its gaming industry. Industry insiders and lobbyists like Steve Brubaker have expressed skepticism regarding the bill's passage. Brubaker, known for his insights into the legislative process involving gaming laws, doubts the bill will clear the hurdles placed before it.
Regulatory Concerns and Lobbyist Influence
One of the contentious issues surrounding the bill is the potential requirement for companies to divest certain interests before they can apply for an iGaming license. This provision aims to ensure a level playing field and prevent conflicts of interest within the burgeoning market. However, it also raises questions about who stands to benefit from the current language of the bill.
Brubaker has pointed out that last year's legal language may have been altered to favor particular industry players, suggesting that Evolution Gaming or casino companies that use their services could be receiving preferential treatment. Such changes often occur under the influence of lobbyists, who strive to shape legislation in ways that benefit specific clients or companies.
"You see bills ‘legislating market share’ all the time. It is the primary reason lobbyists exist," Brubaker remarked, highlighting the role of lobbying in the legislative process. His observations underscore the complex interplay between lawmakers, industry stakeholders, and lobbyists in the crafting of legislation that affects such a lucrative sector.
Looking Ahead
Despite the uncertainty shrouding the future of online gambling in New York, the debate continues to garner attention from various quarters. For legislators like Sen. Addabbo and Rep. Pretlow, the argument for iGaming is tied to the broader financial well-being of the state. They emphasize the opportunity to redirect funds currently flowing out of state or into the hands of unregulated entities back into public coffers, where they could support essential services such as public education.
As the discussion around the iGaming bill unfolds, observers like Brubaker remain intrigued by the potential amendments that could alter the bill's trajectory. "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," he stated, pointing to the dynamic nature of the legislative process and the ongoing struggle for dominance in the live dealer segment of the industry.
In conclusion, the path forward for iGaming in New York is fraught with challenges and complexities. As the 2024 legislative session progresses, all eyes will be on the developments surrounding this pivotal piece of legislation, which promises to have far-reaching consequences for the state's economy and the future of online gambling.