- New York Sports Betting Online 2020
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- Legal New York Sports Betting Online
- New York Online Sports Betting Bill
New York was one of the first states to pass legislation authorizing sports betting back in 2013, through the first legal wagers were not accepted until 2019. Mobile and online betting are not currently available in the Empire State, but their legalization would undoubtedly create one of the biggest sports betting markets in the country. Feb 04, 2021 Cuomo Calls For New York To Be The Online Sports Betting Empire State New York Gov. Andrew Cuomo repeated his desire for the state to run online sports betting in his budget address but did not provide details of his proposal. New York's four brick-and-mortar casinos didn’t reopen until Sept. 9, and its lack of online sports betting has left the state a handle far behind New Jersey's. AP Photo/John Locher New Jersey reported record sports wagering volume for a second consecutive month in September ($749 million, +12% MoM), with operators retaining $45.1 million. Best New York Online Gaming Sites. New York Online Casino. Chumba Casino – Best New York online casino. New York Online Poker. New York Online Betting.
We have arrived. The most wagered-on event in sports betting. The Super Bowl.
The Buffalo Bills failed to reach the big game, but Super Bowl LV will no doubt attract plenty of attention in New York. How could it not? Tom Brady and the Tampa Bay Buccaneers, the first team to play for the Lombardi Trophy in its home stadium, against Patrick Mahomes and the Kansas City Chiefs.
While Super Bowl betting will spike in jurisdictions that have legalized wagering, New York sports betting will miss out on hundreds of thousands of dollars in tax revenue because it lacks regulated online sports betting. Super Bowl betting in NY will only take place in retail sportsbooks.
Even a conservative estimate of the impact of online sportsbooks in New York shows how much the state could have benefited from offering legal options to wager online.
What could have been if New York had legal online sports betting
There’s no doubt about the demand for online sports betting in NY. A recent estimate puts the value of mobile betting handle at $20 billion annually in the Empire State. Earlier figures suggested that New Yorkers crossed the state line to make legal wagers in New Jersey to the tune of $837 million in 2019.
A state-commissioned study indicated that mobile wagering in New York could lead to $1.1 billion in annual gross gaming revenue in three to five years. The study, done by Spectrum Gaming Group, also noted that the state could pocket more than $100 million each year in state revenue.
That $837 million figure from 2019 doesn’t count the number of New Yorkers crossing another border, into Pennsylvania, to wager online. This year, NY residents will no doubt contribute toward Super Bowl handle estimates of $75 million in New Jersey and $55 million in Pennsylvania.
The Super Bowl is the single biggest betting day of the year for US sportsbooks. So what would New Yorkers wager online this year if they had the option to do so legally? It’s important to remember three things in forming a guess here:
- Not all online bettors instantly gravitate to legal books when they become available.
- It’s possible that legal betting apps in New York could pull traffic from residents of neighboring Connecticut, Massachusetts, and Vermont.
- In this hypothetical situation, online wagering would be legal statewide, so more than just the population of New York City counts.
With those things in mind, assume handle in New York (in its first year) could compete with that of nearby New Jersey. The state is populous, has a robust sports presence, and the population is familiar with the concept of legal gambling. Those things lend well toward a strong performance.
How much tax revenue could Super Bowl online sports betting produce?
Let’s take the hypothetical scenario of NY legalizing online sports betting in 2020. Had the state done so, a conservative figure for Super Bowl handle in New York this year would be $70 million. It’s likely that the event could be worth more when the market hits maturity, as Spectrum projected. But in this example, bettors would be placing legal Super Bowl bets online in New York for the first time.
Another thing that’s necessary to quantify is a hypothetical hold. Sportsbooks don’t always clean up on Super Bowl wagers. As a matter of fact, legal books in both New Jersey and Pennsylvania have yet to record a Super Bowl Sunday in which they won.
For the sake of this example, assume the books collectively held 5%. Furthermore, assume the state lands on a tax rate of 10% for aggregate revenue and doesn’t allow operators to comp their promotional credits.
New York Sports Betting Online 2020
Those operators would hold an estimated $3.5 million (5% of $70 million). Taxed at that rate, that would mean $350,000 in revenue for the state. That’s not enough to solve the state’s current budget deficit. However, it’s quite a windfall from just one game.
Instead, this year, all that handle will go to legal books in New Jersey and Pennsylvania. Or even to offshore websites. New York could be close to correcting that issue, on some level. To what degree that happens depends on whether New York online betting is a state-run monopoly like Gov. Andrew Cuomo wants or a competitive market.
Will Cuomo’s plan handcuff Super Bowl online betting potential?
If Cuomo gets his way, Super Bowl handle might be a shadow of its potential. If the state enacts a broader framework, however, there’s cause for optimism. A single-operator system can not only lead to short odds but also a lack of promotional offers to draw bettors to the regulated market.
As a result, a lot of New York bettors could stick with their offshore channels or keep crossing state lines because they can get a better deal. Less handle means fewer tax dollars for the Empire State. On the other hand, a more open system could help out a lot.
The latest proposal out of the legislature in Albany would tether online wagering to the state’s commercial and tribal casinos. Such a proposal would give each property and tribe an extra skin to delve out. That could mean as many as 14 online sportsbook options in the state.
It would also bring some of the nation’s strongest brands into the market. BetRivers, DraftKings, FanDuel and William Hill have all already negotiated access with casinos. The extra skins would also give other books like BetMGM and PointsBet a path into New York.
So far, legislators seem determined to push through their version instead of Cuomo’s. Assemblyman Gary Pretlow, who chairs the Racing, Gaming, and Wagering Committee, called Cuomo’s plan “nonsense.” There’s always a risk that Cuomo could veto any bill that strays too far from his preferred route, however, and there may not be enough votes in the legislature to override that.
While leaders in Albany work out the details, the state treasury sits bereft of the potential hundreds of thousands of dollars that online sports betting on this year’s Super Bowl could have wrought. If a stalemate develops, the same may go for 2022 and beyond.
Written by Jared Joyce
Sport’s bettors in New York received some potential good news as Governor Andrew Cuomo unveiled a plan that would legalize online and mobile sports betting statewide. Governor Cuomo’s proposal came on January 6th in response to New York’s growing budget deficit resulting from the Covid-19 pandemic. The Governor’s proposal marks a stark departure from his prior position regarding online and mobile sports betting.
Since the Supreme Court’s groundbreaking 2018 decision in Murphy v. NCAA, which struck down the federal law that effectively prohibited gambling on sports in most states, New York, the District of Colombia, and 18 other states have legalized sports betting. Although sports betting is already legal in New York, it is confined to in-person betting at a handful of sportsbooks owned by Native American tribes or the four commercial casinos in the state. Under the current law, a sportsbook is the physical location inside one of the brick-and-mortar casinos where bettors go to place wagers. Should New York adopt online and mobile sports betting, bettors would be able to continue to place bets at the brick-and-mortar locations, or through online sportsbooks that would consist of a website or mobile app. The legalization of mobile and online betting would place New York in the company of 14 other states, such as neighboring New Jersey and Pennsylvania, that have already taken the step to legalize mobile and online betting.
Governor Cuomo’s Proposal
Under the proposed legislation, private operators will only be able to obtain a license from the New York State Gaming Commission if they have a partnership with one of the existing Native American or commercial casinos. The New York State Gaming Commission will “solicit bids for a small number of mobile sports wagering operators” in order to decide who will obtain a license.
Governor Cuomo stated that the state’s proposed model would allow the state to maximize revenue compared to the system’s in place in the other states that have already legalized mobile and online betting. In New Jersey, for example, there is no competitive bidding process to issue licenses, rather the online sportsbooks are tied directly to the brick-and-mortar casinos, rather than through an independent operator. According to Robert Mujica, the New York state budget director, the competitive bidding approach of the proposed model could be the difference between the state collecting $50 million and $500 million in tax revenue.
Skepticism Over the Governor’s Proposal
Governor Cuomo’s plan has been met with skepticism from both legal and gaming experts.
Legal experts are concerned that the proposal will violate the strict anti-gambling language of the New York State Constitution. The language of the State Constitution limits sports betting to the Native American and commercial casinos. In an effort to circumvent this requirement, the state is requiring operators to partner with and house the servers for online and mobile sports betting inside of the previously mentioned casinos. It is still unclear whether these requirements will satisfy the constitutional requirements.
Gaming experts have also expressed concern that New York’s proposed model would hinder the state’s ability to maximize tax revenue. Under the proposed model, Governor Cuomo said that the Gaming Commission will limit the number of licenses, known as “skins,” in the betting world, to a “small number” of operators. There is speculation that the number of skins available will be limited to one for each of the existing casinos. New York Assemblyman Gary Petrow favors a system allowing for more than one skin, arguing that just because the Gaming Commission is authorized to issue more skins, it doesn’t mean that they have to issue all of them.
One argument posed by Chris Grove, a partner at a gaming analysis firm, is that limiting the number of operators “reduces product diversity and marketing, which would lead to fewer legal wagers.” Grove favors a model with closer to 10 skins.
Matt King, the CEO of FanDuel Group, which is already authorized to operate their daily fantasy games in New York, but not their sportsbook, believes that “a model with competition among experienced operators is critical to maximizing state tax receipts.”
Although the current model calls for a “small” number of skins, State Senator Joe Addabbo has mirrored the sentiment of Petrow, Grove, and King, and believes that it is in the state’s best interest to institute a more expansive system. Addabbo has said that he will work across the chambers with Petrow to try and get the proposal passed, even if that means adding more skins.
Although there is dispute as to the best way for New York to implement online and mobile sports betting, there is a consensus among all parties that it will help generate much needed tax income for the state. Not only will legalization generate revenue for the state, it will provide bettors with a piece of mind that their money is safe in licensed casino, as opposed to with a bookie or illegal online site. Ultimately, the legalization of online and mobile sports betting would be a win-win for all involved.
Sources
Adam Liptak & Kevin Draper, Supreme Court Ruling Favors Sports Betting, New York Times (May, 14, 2018).
Jimmy Vielkind, Gov. Cuomo’s Plan for Mobile Sports Betting in New York Faces Questions, The Wall Street Journal (Jan. 14, 2021).
Mathew Waters, Why Single-Skin Sports Betting Could Limit Ohio, New York Markets, Legal Sports Report (Dec. 3, 2020).
Online Sports Betting New York State
New York Sports Betting, Legal Sports Report (last visited Jan. 27, 2021).
New York Online Sports Betting Law
Legal New York Sports Betting Online
Zachary Zagger, NY Gov. Floats Mobile Sports Betting Amid Virus’ Budget Hit, Law360 (Jan. 6, 2021).
New York Online Sports Betting Bill
Photo courtesy of The Wallstreet Journal