New York Gov. Andrew Cuomo has included a state-run mobile sports betting market in his final budget for 2022, opting for an RFP process and two platform providers. [Image: Shutterstock.com]
A final agreement
Governor Andrew Cuomo set New York State on a journey towards mobile sports betting at the beginning of the year when he first established his support for a legal market. Now, he has paved the way for its introduction by including it in his state budget for 2022.
The governor and other state leaders announced they had reached an agreement over the $212bn state budget late on Tuesday night, six days after the initial deadline. Cuomo took to Twitter to publicize the plan’s highlights:
Notably, Cuomo seems to have come up on top in negotiations. The budget opts for state-run mobile betting, with a request for applications (RFP) process run by the New York State Gaming Commission.
The governor has consistently backed a state-run model since the beginning of the year. Explaining this preference on Monday, he told reporters: “We’ll contract with them and we’ll make the money. We don’t need the casinos as a middleman.”
Taking a closer look
A press release from the governor’s office outlines some details of the new mobile betting framework. The state will issue an RFP and choose at least two platform providers to partner with. Each platform will then have no less than four mobile sports betting skins.
operators must give 50% to 55% of their mobile revenue to the state
Cuomo has not revealed many other key details. However, mobile betting proponents Senator Joseph Addabbo and Assemblyman Gary Pretlow provided further information Tuesday afternoon. They said operators must give 50% to 55% of their mobile revenue to the state, and platform providers will pay a one-time fee of $25m.
The governor has predicted that a legal market will generate more than $500m in annual revenue for the state. Once fully phased in, mobile betting will contribute $5m to youth sports and $6m to fighting problem gambling each year. The rest of the money will go towards education.
The introduction of mobile sports wagering is one of several new efforts to increase state revenue in the aftermath of the COVID-19 crisis. In January, Cuomo said New York must raise $15bn per year in the next two budget cycles to counter the deficit.
Losers in the outcome
Tuesday’s budget announcement may have come as a blow to those on other sides of the sports betting debate. Most notably, Sen. Addabbo and Assemblyman Pretlow have consistently backed a competitive model. In January, they proposed a bill which would enable the state’s commercial casinos to partner with two mobile operators each.
However, the two lawmakers were not alone in their preference for a competitive market. The Assembly and Senate also indicated their support for this model in their budget proposals last month. Both included a multiple-provider market reflecting details of Addabbo and Pretlow’s legislation.
could cost the state up to $70m in annual payments
The Oneida Indian Nation has also expressed its grievances in regards to mobile betting plans. The central New York tribe raised objections last week after learning it could be excluded from the new market. The group warned that this could cost the state up to $70m in annual payments from tribal slot revenue.
Cuomo waived away concerns regarding the Oneida disagreement on Monday. Robert Mujica, New York’s financial director, also confirmed an intention to include the tribes in mobile betting. No update has been provided on these negotiations however.
Other sports betting updates
New York is not the only state to see some recent activity in regards to sports betting legislation.
In Maine, Senator Louis Luchini introduced a bill to legalize sports betting on Monday. Senate Bill 1352 would authorize retail and mobile sports wagering for commercial racetracks, off-track betting facilities, casinos, and tribal properties. Each operator will pay a license fee of $20,000, in addition to a 10% tax for land-based and 16% for mobile.
Meanwhile, a group of lawmakers in Maryland have suggested uncapping the number of licenses for certain retail and mobile sportsbooks. The Maryland Senate work group passed their suggestions on to the Budget and Taxation Committee on Tuesday as lawmakers formulate the state’s sports betting legislation.