Cuomo Comes Around on Mobile Sports Bets

In his January 11 State of the State address, New York Governor Andrew Cuomo (l.) will finally announce his support for mobile sports betting. Cuomo has long opposed online wagers, even as nearby New Jersey cleaned up.

In this week’s State of the State address, New York Governor Andrew Cuomo will finally declare his support for mobile sports betting. According to the New York Daily News, the governor, outspoken in his opposition to online wagers until now, will “make the revenue-generating measure a central part of his policy proposals.”

Cuomo’s turnabout is seen as a surrender to the budget demands created by Covid-19, which has drained state coffers. Sports betting is already legal in New York but can only be done on-site, at a casino, despite the overwhelming preference of sports bettors for mobile.

Meanwhile New Jersey, which dominates the online wagering market, has made the most of sports betting in all its forms. Handle reached $931.6 million in November, outpacing Nevada and breaking a previous one-month record, and more than 90 percent of those bets were placed online or on mobile devices. Operators reaped $50.6 million in revenue for the month, and the state got $6.2 million in taxes. Moreover, one survey found that nearly one-fifth of New Jersey’s sports wagering revenues come from New Yorkers who cross the border to bet on sports; an Eilers & Krejcik Gaming report in February 2020 estimated New Yorkers wagered $837 million in New Jersey in 2019.

Cuomo now seems to have bowed to the inevitability of mobile, and also dropped his contention that legalizing the bets would require a change in the state constitution. In a statement, he said, “At a time when New York faces a historic budget deficit due to the Covid-19 pandemic, the current online sports wagering structure incentivizes a large segment of New York residents to travel out of state to make online sports wagers or continue to patronize black markets.

“New York has the potential to be the largest sports wagering market in the United States,” Cuomo continued. “By legalizing online sports betting, we aim to keep millions of dollars in tax revenue here at home, which will only strengthen our ability to rebuild from the Covid-19 crisis.”

It’s a far cry from his position of a year ago, when the governor said mobile sportsbooks would provide “no new casino revenue.”

“This is not the time to come up with creative although irresponsible revenue sources to solve a problem which doesn’t really exist,” he said at the time.

State Senator Joseph Addabbo, chairman of the Senate Racing, Gaming and Wagering Committee, said it’s “encouraging” that the governor has changed his view, and agrees there are no constitutional issues. Servers for mobile betting would be placed at retail locations that already are approved mobile betting operators.

“I’m hopeful his administration is just as enthusiastic and energetic about implementing mobile sports betting in our state as I am,” Addabbo said.

“By legalizing mobile sports betting, New York will be able to reap the benefits of the economic gains it will create and help the state rebuild after the Covid-19 pandemic, in addition to increasing educational funding, addressing illegal (gambling) activity in the state and assisting those with gaming addictions.”

Addabbo disagrees with Cuomo’s plan to let the state Lottery Division run the show, fearing it would limit competition and a free-market approach that could drive more sports bets. “We have to get it right in the short term. I don’t want to miss out on an opportunity,” he said.

According to the Buffalo News, Robert Mujica, Cuomo’s budget director, estimates that online sports betting plan could bring $500 million to the state. According to Legal Sports Report, New York may need to compare favorably with the Garden State’s 13 percent tax on mobile revenue, but the Cuomo administration has suggested it’s after a bigger cut of the revenue pie. “I’m here to raise money for the state,” Cuomo said.

Upstate New York’s four casinos would be first in line to offer the bets, and the state could grant three additional licenses. Among operators who may launch the new market are BetMGM, whose parent company owns and operates Empire City Casino at Yonkers Raceway; DraftKings, which partners with Resorts World in New Jersey and currently runs retail betting at del Lago Resort & Casino in Waterloo; FanDuel, which already runs the retail sportsbook at Tioga Downs in Nichols; Rush Street Gaming, owners of Rivers Casino & Resort Schenectady and online operator BetRivers; Fox Bet, which will presumably run the mobile enterprise for the Mohawk Tribe, which runs the Akwesasne Mohawk Casino Resort in Hogansburg; and Caesars, which struck a deal with the Oneida Tribe, operator of Turning Stone Resort in Verona.