Gov. Andrew Cuomo Gives Little Update on New York Sports Betting in Budget Address; Still Prefers Lottery Model
Lev Radin/Pacific Press/LightRocket via Getty Images. Pictured: Andrew Cuomo and a New York Islanders hat
New York Gov. Andrew Cuomo said Tuesday in his budget address that he's still open to sports betting but prefers a lottery model. Though a press release last week indicated the governor could support "one or more" licensees, the reiterated lottery support means the governor could be stuck on a much-dreaded single-operator model.
Cuomo said Tuesday his proposal could generate $500 million in tax revenues for the state. He said New York should money directly from sports betting, and not downstream from casino sportsbook tax revenue.
"The question isn’t whether or not we do mobile sports betting. The question is more how and who makes the profit. And this is very lucrative. One proposal is we allow casinos to run mobile sports betting. That's very good for casinos and the people who support casinos," Cuomo said.
"The second alternative is to have the people of the state of New York actually get the profits from a mobile sports betting and run it the way we run the state lottery, which is it's state run and the state gets all the revenue. I'm with the people. And I believe the people of the state should get the revenues. This is not a moneymaker for private interests to collect just more tax revenue. We want the actual revenue from the sports betting."
Cuomo didn't offer further details while briefly touching on sports betting in his nearly hour-long budget address. State's such as Virginia and Tennesee have approved multi-operator models under their respective government lottery purviews', but other lottery-run states have become de facto monopolies.
Industry stakeholders have long pushed for a multi-operator model such as in neighboring New Jersey to increase competition and ultimately, revenue. The Garden State has more than 20 sportsbooks operating.
In a single day earlier this month, Cuomo shocked the sports betting world by saying he's open to legal wagering, only to follow up that he's only interested in a single-operator model. That disappointed industry stakeholders and bettors who want options.
Cuomo claims a single-operator model would generate 10-times the revenue for the state since all sports betting winnings would go to the state's lottery. But gaming experts have pushed for a multi-operator model such as New Jersey and Pennsylvania, which allow for competitive markets.
The success in those states is clear, while states with lottery models like Washington D.C. and Oregon lag behind in revenue and growth.
New York Assemblymember J. Gary Pretlow and Sen. Joseph Addabbo introduced identical multi-operator wagering bills in their respective chambers shortly after Cuomo's initial announcement supporting online wagering earlier this month.
Both bills would allow for 14 online operators, likely including major players such as DraftKings and FanDuel. Those bills also included expanded retail operations, including sports betting kiosks at stadiums, arenas and off-track betting facilities.
Cuomo's initial plan specifically called for one operator, creating a monopoly with zero competition, such as in D.C., which has generated just over $1 million in revenue for the state since going live earlier this year.
New Jersey has taken almost $11 billion in bets since going live in 2018 and has generated nearly $100 million in tax revenue for the state, and that doesn't include massive advertising dollars sent into the state by major operators like DraftKings.
Last's week's revised statement opened the door for multi-operators, but it remains to be seen if that is plausible politically. The plan by Cuomo's fellow Democrats in the legislature centers on the state's commercial casinos and Native American gaming tribes, creating a divide that can't be compromised: either Cuomo gives into lawmakers' proposal or they relent and go with the lottery plan.
Or, in the worst-case scenario, what would be the single largest sports betting market by handle could remain sidelined for another year.
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