The Fate of iGaming in New York Hangs in the Balance
As New York's legislative session unfolds, a significant piece of legislation is notably absent from Governor Kathy Hochul's 2025 budget proposal. Senator Joseph Addabbo Jr.'s iGaming bill, which suggests a hefty 30.5% tax on online casino revenues, has not made the cut. This omission signals that Governor Hochul may be distancing herself from the bill during this year's legislative proceedings.
The exclusion of the iGaming bill stands in stark contrast to the state's previous embrace of online sports betting, which was incorporated into the 2022 budget with an even higher tax rate of 51%. The decision to legalize online sports betting was driven by the potential for increased state profits and a means to address budget shortfalls—an argument that supporters of iGaming also champion.
Proponents of the iGaming bill argue that without legalizing online casinos, New York risks losing valuable revenue streams to neighboring states where such activities are legal, or worse, to illegal operations that offer no consumer protections or contributions to public funds. Yet, despite the potential financial benefits, the bill's future remains uncertain.
Economic Implications and Industry Concerns
The economic implications of legalizing iGaming in New York are substantial. Legalized iGaming could funnel hundreds of millions of dollars into state coffers, offering a much-needed boost to public services such as education. Senators like Addabbo and Representative Pretlow have emphasized the missed opportunities for funding critical services due to the current lack of legalized iGaming options in the state.
However, skepticism exists within the industry regarding the bill's chances of passing. Steve Brubaker, an industry lobbyist, has expressed doubts about the bill's success. He also highlights that companies interested in entering the market might face the need to divest certain interests before they can apply for a license, should the bill eventually pass.
Another point of contention is the language used in last year's legal drafts. There is speculation that the wording may have been altered to favor specific industry players, particularly those who provide live dealer services. Brubaker notes that it seems like a "very light touch for Evolution," a company known for its live dealer games, suggesting that changes to the legal language might have been made to benefit either Evolution itself or the casino companies that utilize their services.
Lobbyists play a significant role in shaping legislation, often influencing the outcome to favor particular companies. Brubaker acknowledges this reality, stating, "You see bills ‘legislating market share’ all the time. It is the primary reason lobbyists exist." He anticipates that the battle for control over live dealer games will continue to influence the amendments and direction of the iGaming bill.
Looking Ahead: Uncertainty and Anticipation
The road ahead for online gambling in New York is fraught with uncertainty. While the current situation looks grim for proponents of iGaming, the legislative process is unpredictable, and amendments could sway the fate of the bill. Stakeholders and observers alike are keenly watching the developments, understanding that the outcome will have a profound impact on New York's economy and gaming industry.
In conclusion, the absence of Senator Addabbo's iGaming bill from Governor Hochul's 2025 budget proposal casts doubt on the immediate future of online casinos in New York. Despite the clear potential for economic gain, political support appears to be wavering. The discussion around the bill is a microcosm of the larger debate about the role of government in regulating and taxing digital industries—a debate that is sure to continue as technology and market forces evolve. As the legislative session progresses, all eyes will be on Albany to see if lawmakers will take a chance on the lucrative world of iGaming or fold their hand for another year.