by Ben Perks
Top gaming lawmakers have teamed up to create a new bill that would drastically change how mobile sports betting operates in New York. The proposal aims to increase the number of operators, reduce taxes, allow write-offs, and help ensure more minority representation in the billion-dollar industry.
More Sports Betting Operators
On Friday, the Senate Racing, Gaming, and Wagering Committee Chairman Joseph Addabbo, D-Queens, filed S8471. It’s a sister bill to A8658A, which Assembly Racing and Wagering Committee Chairman J. Gary Pretlow, D-Mount Vernon, had filed earlier this year before amending it on March 3.
The bill’s principal aim is to expand the number of operators allowed in the Empire State – a change that would also decrease the current 51% tax rate. Last year, the New York State Gaming Commission gave the approval for nine operators. In the first two months of their launch, operators have handled over $3 billion in wagers – making New York the new US capital of online sports betting.
The new proposal will aim to convince the commission to award “no fewer than” 14 licenses by January 31, 2023, and 16 permits by January 31, 2024. If a minimum of 14 operators are given the green light, the tax rate will drop to 35 percent. However, if 15 or more operators obtain licenses, the rate will decrease to 25 percent.
Online Sports Betting Apps in New York
| Sportsbook | Where Available | States Available |
|---|---|---|
| Bally Bet | App Store, Google Play | CO, IA |
| BetMGM | App Store, Google Play | AZ, CO, IA, IN, MI, NJ, PA, TN, VA, WV, WY |
| BetRivers | App Store, Google Play | AZ, CO, CT (SH), IL, IN, IA, MI, NJ (SH), PA, VA |
| Caesars | App Store, Google Play | AZ, CO, IA, IL, IN, MI, NJ, PA, TN, VA, WV |
| DraftKings | App Store, Google Play | AZ, CO, CT, IL, IN, IA, MI, NJ, PA, TN, VA, WV |
| FanDuel | App Store, Google Play | AZ, CO, CT, IA, IL, IN, MI, NJ, PA, TN, VA, WV |
| PointsBet | App Store, Google Play | CO, IA, IL, IN, MI, NJ, WV |
| Resorts World Sportsbook | App Store, Google Play | NV, NY |
| WynnBET | App Store, Google Play | AZ, CO, IN, MI, NJ, TN, VA |
Failed Sports Betting License Bids Could Get Second Chance
Last year, the NY Gaming Commission revealed that it had received bids from six platform providers that represented 14 operators, meaning five were unsuccessful. But if passed, the new bill would allow failed bidders and new companies to apply for online betting permits again.
New York State representatives James Gary Pretlow and Addabbo originally wanted a broader mobile sports betting system in New York, but then-Gov. Andrew Cuomo quashed their efforts because of his desire to ensure the tax rate was at least 50 percent – the current legislation stipulates that if there are under 14 platforms, the rate is set at 51 percent.
More Minority Investment
The bill also calls for more diversity in sports betting by asking the commission to approve at least two applications with “qualified minority representation.” Pretlow and Addabbo have legally defined this as “an entity comprised of no more than six individuals qualified as members of a minority group… with a direct or indirect economic interest of at least five percent in the applicant.”
This is encouraging news for failed bidder Fanatics. Last year, it teamed up with Barstool Sports and floated the idea of partnering with rapper/entrepreneur Jay-Z when bidding. However, the Gaming Commission decided against granting the group a license.
In a Twitter Spaces conversation this past week, both Pretlow and Assemblywoman Michaelle Solages (D-Elmont), chairwoman of the New York State Black, Puerto Rican, Hispanic, and Asian Legislative Caucus, voiced their disappointment that the Gaming Commission denied Fanatics. They also added that increasing diversity in this industry remains a top priority.
“I have been pushing for minority participation from the beginning,” said Pretlow. “The way that the rollout was designed by the (former) governor, it kind of eliminated anyone except the big players. Many people couldn’t afford a 51 percent tax on gross gaming revenue.”
Write-Offs and Costs for Newcomers
The new proposal also plans to allow operators to exclude wagers that bettors make using promotional offers (such as credits) from their gross revenue. This change would enable companies to reduce their tax liability. Also, in months when operators report gross revenue losses, operators could carry those over to the following month.
Approved operators agreed to pay a $25 million licensing fee to operate within the state of New York and to pay a high 51 percent tax rate. In return, platforms were given 10-year licenses. However, the bills filed by Pretlow and Addabbo call for operators to pay a $50 million fee. Yet it remains unclear whether the fee would apply only to new operators or current license holders as well.
Check out this legal sports betting tracker to learn more about wagering laws in each state.
Ben is a sports journalist & part-time trader with a passion for finding +EV bets. Ben lives in Madrid, Spain where he enjoys the live poker scene, and sunshine where he covers UFC, MLB, NHL, NBA, as well as tennis betting.
