Lawmakers weigh mobile casino gaming to boost state revenue

Lawmakers are working to amend legislation to legalize a new form of online gambling in the state officials say could bring upwards of $1 billion in revenue to New York and help close budget gaps expected over the next few years.

The Legislature took its time to change the law to allow mobile sports betting, which debuted in the state in January 2022, and has significantly impacted state revenue since. 

Mobile sports wagering receipts brought in $729 million to the state in Fiscal Year 2022-23, per the state Budget Division's mid-year financial report released Monday. That amount has more than doubled since this time last year when the industry was less than a year off the ground.

Its success is spurring discussion to permit online casino gaming — also known as iGaming — in the state, allowing games like blackjack, roulette and others to be played from a mobile device.

"So you can download an iGaming or online casino app, deposit funds and begin playing blackjack on your phone from the comfort of your home, rather than having to go to an upstate casino, said Max Bichsel, Gambling.com Group's vice president of sports.

Seven other U.S. states already allow iGaming, including neighboring Pennsylvania, New Jersey and Connecticut.

Senate Racing, Gaming & Wagering Committee chair Joe Addabbo sponsors the bill and says New York needs to follow suit, to not lose business across state lines.

"Other states surrounding us are doing it," Addabbo said. "We can do this."

It's something Addabbo says he hopes Gov. Kathy Hochul might consider as early state budget preparations get underway and state leaders eye potential revenue-raising policy changes.

"I think it's the conversation we have to have dictated by the poor fiscal situation we're going to be in next year," the senator said.

Online casinos would be taxed at 30.5% under the proposal which the senator says is estimated to net about a billion dollars in revenue after the first year.

Bischell says the state policy needs to include a tax rate that would foster future growth, and allow for casino competition to give consumers choice.

"An element we advocate for is competition," he said. "You can't have a healthy market with just one casino or two casinos, that just doesn't, doesn't provide competition, it goes and give consumers choice. And it really gives the casino operators a lot more power than they realistically should have where people can only go to this one monopolistic casino, because that's the only one that's there."

Several casinos declined to be interviewed about their position on the proposal to legalize iGaming. 

Addabbo says the proposal could give brick-and-mortar casinos a way to expand the gaming they offer, rather than hurt business. 

Allowing mobile casino gaming in the state would not impact the three casinos proposed in downstate areas, the senator added.

Addabbo and his staff are in the process of tweaking the legislation before it will be reintroduced in December before session resumes in January. They plan to review and alter the tax rate, structure, details about the number of land-based casino versus mobile casino operators and earmarking some of the revenue to combat increased gaming addiction expected to rise as the online gambling industry expands in New York.

"We want this to be a job generator," Addabbo said. "We want this to be, of course, a revenue generator, but we also wanted to be addressing the problem of gaming addiction."

New Yorkers who go to other states to participate in iGaming can struggle to find resources or assistance for addiction as the form of gambling remains illegal in New York.

"We can't help someone with an addiction because we don't know who they are, and once we regulate it in New York, iGaming, we then can help those that might be in need are on their pathway to addiction," the senator said. "We'll put in statutory language in this bill to address that."

Gov. Hochul has not publicly spoken about or addressed legalizing online casino gaming in the state.

A spokesman with Hochul's office Tuesday said the governor would review anything the Legislature passes.