Online Gambling in New York: A Tug of War Over iGaming Legislation
In the unfolding drama of New York's budget planning, a significant piece of legislation has been notably absent from Governor Kathy Hochul's 2025 fiscal blueprint. The bill in question, spearheaded by Senator Joseph Addabbo Jr., seeks to introduce a regulatory framework for online casino operations—commonly referred to as iGaming—in the Empire State. However, its exclusion from the budget indicates potential resistance from the governor’s office.
The proposed legislation outlines a tax rate of 30.5% on revenues generated through online casinos. This figure stands in contrast to the hefty 51% tax currently imposed on online sports betting, which was successfully integrated into the state budget two years prior, in 2022. While the sports betting precedent might suggest an appetite for digital wagering, Governor Hochul's stance on the iGaming bill during the 2024 legislative session remains unclear.
Proponents of the bill argue that legalizing iGaming could be a financial boon for New York, potentially ameliorating budget deficits. They warn that without the passage of this bill, New York risks hemorrhaging money to neighboring states where such activities are legal or, worse still, to illegal gambling operations. The sense of urgency is palpable, as the state looks for innovative revenue streams to fund public services, including education.
Despite these arguments, industry lobbyist Steve Brubaker has expressed skepticism regarding the bill's chances of passing. He suggests that last year's legal language, which may have been crafted to benefit certain industry players, could see revisions that tilt the scales in favor of different interests this time around. Brubaker's insight reveals the complex interplay between lobbyists and lawmakers, with the former often shaping legislation to serve the business interests they represent.
A particularly contentious point in the bill concerns the future of live dealer games—a rapidly growing segment in the online casino market. Companies interested in obtaining a license might find themselves having to divest certain interests, a stipulation that underscores the bill's potential impact on the gaming industry's structure.
"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," argued Sen. Addabbo and Rep. Pretlow, vocal advocates for the bill. Their statement reflects a broader concern about the economic ramifications of inaction.
Brubaker, delving deeper into the politics of legislation, noted, "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." His comments hint at the behind-the-scenes maneuvering that shapes the legal landscape of industries like online gambling.
He further illuminated the role of lobbyists in legislative processes, stating, "You see bills ‘legislating market share’ all the time. It is the primary reason lobbyists exist." This candid acknowledgment sheds light on the strategic motivations driving lobbying efforts.
Regarding the bill's prospects, Brubaker offered a somewhat pessimistic forecast but acknowledged the dynamic nature of the legislative process: "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 iGaming in New York
The fate of online gambling in New York hangs in the balance, with the outcome set to have significant implications for the state's economy and the gaming industry at large. As legislators, lobbyists, and industry stakeholders engage in a complex dance of influence and interest, the path forward for iGaming remains shrouded in uncertainty.
The debate over the iGaming bill encapsulates a broader struggle over how best to harness the economic potential of online gambling while ensuring regulatory oversight and ethical business practices. As the 2024 legislative session unfolds, all eyes will be on Albany to see whether New York will double down on digital gambling or fold its hand for the foreseeable future.