January 8, 2024, marked a significant milestone in New York’s online sports betting industry, celebrating its second year with record-breaking wager volumes and substantial profits for both the state and licensed operators. Despite the overwhelming success of sports betting, which exceeded expectations, the prospect of legalizing online gambling remains uncertain for the year.
What Governor Kathy Hochul Said For New York’s FY 2025 Budget?
On a recent Tuesday, Governor Kathy Hochul unveiled New York’s FY 2025 Budget, totaling $233 billion. Notably, the budget made no mention of online gambling, casting doubt on the possibility of its legalization within the year. Following the budget release, Governor Hochul stated, “This budget demonstrates our ability to balance fiscal responsibility with progressive, people-focused policies.”
Additionally, Hochul remarked, “I am steadfast in my commitment to championing the right causes for New Yorkers and to promote the common good with a practical approach – by finding common ground.” Intriguingly, iGaming did not gain much attention in 2023 and was also omitted from the 2024 state budget.
Despite earlier predictions that legalizing online gambling could bring significant tax revenue, the recently unveiled budget excludes this activity. However, this omission doesn’t definitively rule out the possibility of iGaming being discussed or considered by lawmakers in the future.
New Bill Advocates for iLottery and iGaming Legalization
Just days before the FY 2025 Budget announcement, Sen. Joseph Addabbo, a proponent of iGaming legalization, introduced an online gambling and lottery bill in New York. Continuing his push for legalizing iGaming, Sen. Addabbo presented Senate Bill 8185, aiming to legalize online lottery and iGaming in the state.
This bill, Senate Bill 8185, builds on Sen. Addabbo’s earlier proposal, S4856, from the previous year, but with a notable addition of online lotteries. Although S4856 did not gain much traction, Senate Bill 8185 reinforces the Senator’s commitment to legalizing online gambling.
The bill suggests a 30.5% tax rate on gross gaming revenue for online gambling operators, mirroring the high tax rates seen in the state’s online sports wagering, which stands at 51%. The proposal also stipulates that players must be at least 21 years old to participate in online gambling. For new licensees, the bill proposes a one-time fee of $10 million, while existing operators would pay a $2 million fee to secure a license.
The Impact of Excluding iGaming from the Budget
The exclusion of online gambling from New York’s FY 2025 Budget highlights the state’s cautious approach towards expanding its gambling industry. This decision reflects a balancing act between fostering economic growth through new revenue streams and addressing concerns related to gambling regulations. The future of iGaming in New York remains a topic of interest, with potential debates and legislative actions still on the horizon.
The absence of online gambling in New York’s 2024 budget, despite its potential for significant revenue generation, indicates a deliberate, cautious approach by the state. The ongoing legislative efforts, like those of Sen. Addabbo, however, keep the conversation alive, suggesting that the topic may resurface in future discussions and decisions.