Money talks. That’s how it has always been and how it will always be until the end of days.
Money may finally be talking loudly enough for New York Governor Andrew Cuomo to listen. Cuomo has been the biggest hindrance to mobile sports betting in New York. Retail sports betting happens upstate and in parts of central New York, but access for the New York City metro area has more or less been restricted to going to New Jersey.
As a result, New York has lost millions and millions of dollars to the Garden State because of Cuomo’s shortsightedness about mobile and online betting.
That position is starting to change. Cuomo is going from a boring baritone to a stunning soprano with his tune on mobile and online betting.
In a report from the New York Daily News, Cuomo is said to be laying out his policy proposals in next week’s State of the State Address. In a prepared statement, Cuomo said that “New York has the potential to be the largest sports wagering market in the United States” and that the Empire State would “keep millions of dollars in tax revenue here at home, which will only strengthen our ability to rebuild from the COVID-19 crisis.”
This echoes a lot of thoughts we’ve had here at ATS. If your state doesn’t have legalized sports betting or has no mobile and online wagering, the COVID-19 pandemic has created a lot of budget shortfalls and refilling those coffers with some sports betting tax revenue makes a lot of sense.
New Jersey pulled in $6.2 million in tax revenue from November’s sports betting handle and you better believe that a lot of that money comes from the five boroughs and surrounding areas of the Big Apple.
It is rather astonishing that it has taken Cuomo this long to realize the error of his ways. In the statement, Cuomo continued, “The current online sports wagering structure incentives a large segment of New York residents to travel out of state to make online sports wagers or continue to patronize black markets.”
No ish, Sherlock.
With the governor’s backing, this seems like more of a reality than ever. New York would cut quite significantly into New Jersey’s piece of the pie, as there have been estimates that New York would trump the current New Jersey yearly betting handles by the second year.
It doesn’t hurt that New York should be able to have a fairly quick rollout with mobile and online wagering. Several operators are already running retail sportsbooks and their gamble to bet on New York looks as though it may finally pay off with access to the largest city in the United States.
DraftKings, BetRivers, and FanDuel are among the biggest operators currently taking retail wagers in New York. Additional operators would have to be worked out with the number of skins (licenses) that each of the commercial and tribal casinos could offer.
This is where the rubber will meet the road as far as Cuomo’s proposals. DraftKings, BetRivers, and FanDuel are already entrenched in the state and DraftKings and FanDuel specifically make up the vast majority of the sports betting market share in the United States. Would Cuomo compromise somewhere in the middle and allow mobile sports betting, but severely restrict the number of available licenses?
Would operators like BetMGM, PointsBet, William Hill, and Barstool (Penn National) have access to the New York market? More operators would be better for consumers, but New York would still have a robust betting market with DraftKings and FanDuel getting most of the handle and BetRivers likely a distant third.
If Cuomo’s support is truly behind mobile and online sports betting, it will happen. The proof is in the pudding with the dollars that go across the border to New Jersey and contribute to the Garden State’s general fund in the form of tax revenue.
This is a significant development and one that will be worth following throughout 2021. It could also have a corollary effect in other states. A state like California, which is generally pretty restrictive in terms of gambling, could see how much sports betting tax revenue helps the cause in recovering from COVID-19 and that could lead a similarly hesitant governor in Gavin Newsom see the benefits of legalized sports betting with an online component.
You never know. When a big domino like New York falls and a lot of big financial numbers get thrown around, other states will simply have to consider the possibilities to an even greater degree.
We’ll just have to wait and see what Cuomo’s policy proposals look like and see how quickly this could become a reality in New York.