With the New York State fiscal year 2024 budget now set in stone, the Metropolitan Transportation Authority (MTA) will receive much-needed funds from the three downstate casino licenses. However, there’s an alternative option lawmakers could consider to secure more money more quickly for the MTA.
The sharp decline in MTA ridership since the COVID-19 pandemic is the primary reason for its funding needs. Without Governor Kathy Hochul’s executive budget rescue plan, there was a risk to subway, bus, and commuter train services.
However, that won’t be necessary due to the availability of three New York casino licenses currently up for grabs.
Nevertheless, an alternative solution could provide even more funding for the MTA.
Downstate casino guard licensing and training to convention out the THE TRANSIT AUTHORITY
There’s no established plan for when the three winning downstate casino bids will be announced by the New York State Gaming Commission (NYSGC). However, once that happens, the groups behind the successful proposals will pay $500 million in licensing fees.
All $1.4 billion generated from the licensing fees will go towards helping to restore the MTA. Additionally, a portion of the estimated $231 million to $413 million in annual tax revenues will also be allocated to the MTA.
However, there’s one issue: That money won’t be available until 2026. The NYSGC has a significant decision to make regarding which casino proposals will receive licensing, and the process is expected to be lengthy and slow.
NY over the internet casinos deliver more money sooner
Ignored in the state’s FY2024 budget was online casino legalization. If it had been included, New Yorkers still wouldn’t have been able to access this type of gaming until next year. However, it would have offered a faster timeline compared to the downstate casino licenses.
Additionally, the New York gaming industry currently directs a significant portion of its tax revenue towards funding public education. In a previous interview with PlayNY, before the state budget was finalized, Senator Joe Addabbo expressed his dissatisfaction with diverting gaming funds away from education in favor of the MTA.
“Every year, the gaming industry contributes about $4 billion to education,” Addabbo said. “I can’t go back to my constituents and say, ‘We took money from education to give to the MTA through downstate licenses.’ That’s a hard sell. I don’t feel comfortable doing it.”
Online casinos, on the other hand, provide a new source of revenue that wouldn’t require taking money from education.
“We could provide Governor Hochul with more money in a quicker timeframe than 2026, and it’s untouched money because it’s a new product, and that’s iGaming,” Addabbo said. “So we’re not shifting that from education. In the bill, it says education, but it’s a placeholder. This is new revenue. So if you want to use it for healthcare, if you want to use it for social services, if you want to use part of it for the MTA, here it is.”
Over the internet casinos may become NY’ s major gaming earnings stream
Legitimate sportsbooks in New York have generated significant tax revenue for the Empire State. Since their launch in January 2022, the state has collected over $1 billion.
However, once online casinos are finally introduced, they are expected to generate even more revenue compared to mobile sports betting.
During a Senate Standing Committee on Racing, Gaming, and Wagering meeting earlier this year, Howard Glaser, the Head of Global Affairs at Light & Shadow, projected that in year one, New York online casinos would generate $425 million in tax revenue. By year four, Glaser expects that number to increase to $720 million annually.
“The states with iGaming,” Glaser stated, “realize that sports betting is the appetizer, but iGaming is the main course when it comes to revenue generation.”
During the committee hearing, Senator Addabbo mentioned that New York loses “about $4 billion” annually when online casinos remain unregulated. Much of that money goes to neighboring states that offer it legally, while some goes to illegal offshore sportsbooks.
Born in Maple Park, Illinois, Matt graduated from Northern Illinois University, where he covered NIU hockey for the Northern Star. Since then, Matt has specialized in NFL and NBA coverage for various websites and podcasts before shifting gears to casino and gambling coverage.
