Exploring the Fate of iGaming Legislation in New York
New York's gaming industry is at a crossroads as legislative efforts to legalize online gambling face uncertainty. A significant development unfolded when it was revealed that Senator Joseph Addabbo Jr.'s iGaming bill did not make it into Governor Kathy Hochul's 2025 budget proposal. The bill, which suggests imposing a 30.5% tax on online casino revenue, seems to lack the gubernatorial support necessary for advancement during the 2024 legislative session.
The exclusion of the iGaming bill from the budget raises questions about the future of online gambling in New York. This comes after the state had previously integrated online sports betting into its 2022 budget, setting a precedent with a substantial 51% tax rate. Despite the high taxation, the inclusion of sports betting was seen as a progressive step towards expanding the state's gaming industry.
The Economic Implications of iGaming Legislation
Proponents of legalizing iGaming argue that it could be a boon for New York's economy, particularly in addressing budget shortfalls. Without the legalization of online casinos, New York stands to lose potential revenue to neighboring states where such activities are legal, or worse, to illegal operations. The financial implications are significant, with hundreds of millions of dollars at stake—funds that could otherwise support public services like education.
In a joint statement, Sen. Addabbo and Rep. Pretlow highlighted the fiscal urgency: "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."
Lobbyist Influence and Industry Dynamics
The intricate dynamics between lobbyists and legislation cannot be overlooked in this discussion. Steve Brubaker, an industry lobbyist, expressed skepticism about the bill's passage. He also hinted at possible amendments to last year's legal language that may have been manipulated to benefit certain industry players, specifically mentioning Evolution (Evo), a company that provides live dealer games for casinos.
Brubaker's observation sheds light on the often opaque influence lobbyists wield over legislation. "Seems like a very light touch for Evolution. Has me thinking that last year’s L&W language was replaced with more favorable language by Evo or by the casino companies who use them," he commented. Moreover, he pointed out a broader trend where bills are crafted to legislate market share, stating, "You see bills ‘legislating market share’ all the time. It is the primary reason lobbyists exist."
These insights suggest that if the iGaming bill were to pass, companies might be required to divest certain interests before they could apply for a license. This stipulation would ensure a level playing field but could also reshape the competitive landscape of the industry. Brubaker's comments underscore the complexity of the situation: "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."
Uncertain Future for Online Gambling in New York
The current state of affairs leaves the future of online gambling in New York in limbo. With the iGaming bill's exclusion from the governor's budget, its prospects appear dim. However, the economic potential of a regulated online casino market remains an enticing prospect for legislators and stakeholders alike.
The outcome of the iGaming bill carries significant weight for New York's economy and the gaming industry at large. As the debate continues, the state finds itself balancing the potential fiscal benefits against the complexities of legislative processes influenced by industry lobbying. What remains clear is that the decisions made today will have long-lasting impacts on the state's financial health and regulatory environment.
As discussions progress, all eyes will remain fixed on Albany, where the fate of online gambling in New York hangs in the balance. Whether the state will embrace the potential economic windfall of iGaming or continue to grapple with legislative hurdles is a story that only time will tell.