As New York lawmakers revisit online casino legalization following the state’s crackdown on sweepstakes casinos, many Finger Lakes residents are questioning what regulated real-money gaming could look like locally.
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On June 6, New York Attorney General Letitia James announced that her office had stopped 26 online sweepstakes casinos from operating. Working with the New York State Gaming Commission, the AG’s office said it was banning platforms that offer players slots, table games, and sports betting using virtual coins that could be exchanged for cash and prizes. They said that this was because sweepstakes casinos are not subject to regulatory oversight or state audits, which could put New Yorkers at risk.
Opening new paths
This is an interesting (and not isolated) position, and many in the pro-gambling lobby are hoping that this might pave the way for real-money online casino legislation to pass. After all, people do play at online casinos, whether they are legal, sweepstakes, offshore, or social. If the AG is concerned about keeping New York residents safe, surely the easiest way to do so is to offer a regulated market. After years of trying, Senator Addabbo hopes online casinos will be legalized in the state this year.
A possible future
So, what could regulated real-money gaming look like? If we consider what other states like New Jersey and Pennsylvania have done, it could look like a lot of fun with the advantage of built-in safety and state oversight. Review sites like Casino.us say that the best real money online casinos look after their customers and provide an entertaining and secure playing environment. As New York’s AG has said that she is concerned about keeping New York’s residents away from potentially rigged casino games, a strong regulatory framework is the best way to ensure that.
Great online casinos offer genuine bonuses, secure payment providers, and games from top developers. If the legislation passes, Finger Lakes residents will enjoy the protections that residents of neighboring states take for granted, such as clear bonus terms, reliable payouts, and strong player protections. At the moment, what can be accessed is all rather murky and certainly illegal. While legalizing online casinos does not mean that all are automatically safe places to play, it certainly offers an additional layer of player protection and provides a backstop should things go wrong.
Risk reduction and financial benefit for the state
Wagering with real money always comes with some risks – you are most definitely not guaranteed a win – but regulated sites have the strongest consumer protections. However, regulation also has benefits for the state. If one works on the premise that people who want to gamble online will find a way to do so, then it can be argued that, by not creating a safe, regulated, commercial market, the state is missing out on valuable revenue. Tax rates on iGaming could be as high as 30%, making the financial incentive to legalize this vertical the strongest argument in its favor.
In addition, federally regulated prediction markets are costing states millions in lost sports betting tax revenue, but do not offer online casino gaming options. This means that states that take a more progressive view towards online casino gambling are more likely to be insulated from prediction market apps taking away their customers.
Possible gaming options
Royals Welcome Back Vinnie Pasquantino as Kansas City Gets a Major Boost Against the Orioles Real-money gaming could look like residents being able to access online casinos on mobile and desktop, with a whole host of slots, table games, poker, and iLottery. One of the most exciting game formats at the moment is the live dealer experience for both table- and quiz-show-style games. Players interact in real time with human dealers who deal real cards or use other gaming devices. If the legislation goes through, Finger Lakes residents will be able to visit the casino floor without even needing to step out of the front door.
The current legislation (should it pass) is designed to work with, not against, New York’s physical downtown casinos. One of the biggest previous objections has been concern about cannibalizing recently approved bricks-and-mortar enterprises like Resorts World NYC in Queens.
Allowing statewide market access
However, while the argument that online casinos might prevent New York City residents and visitors from spending money at physical casinos, it does not ring true for the wider state. Who is going to travel the best part of 300 miles from Finger Lakes to Queens for a one-off casino night? Sure, it might be a one-off treat, but New York state residents are currently mostly excluded from playing casino games. Ironically, right now it is easier for many of them to simply cross the border to play in regulated markets in New Jersey, Pennsylvania, Connecticut, or Rhode Island. Finger Lakes folk might even be tempted to hop across the national border and play at Canada’s land-based and online casinos!
Counting the tax benefits
New York’s legal mobile sports betting sites generated more than $1.3 billion in taxes last year, and the operators have to pay 51% of GGR and hefty licensing fees. New York has the highest tax rates of any legal betting jurisdiction, but that has not dampened competition or operators’ desire to enter the market. iGaming is actually more popular than sports betting and, where it is legal, is fueling market growth.
A tax rate of half of what the sportsbooks are charged could generate even more revenue for the treasury than sports betting in the long run. iGaming advocates believe that online opportunities would complement, rather than compete with, the Las Vegas-style casinos being established in the city.
Unsurprisingly, the physical casino operators are the biggest opposition, but if, for example, live dealer games could be hosted from their casinos, it could be a win-win for everyone. Also, the proposal is that online operators would have to partner with physical casinos so that the profits are shared equally. The bill currently being proposed includes $25 million annually for training, staff development, and responsible gambling. The idea is that no one should be left behind or lose out on market expansion.
Not if but when
For Finger Lakes residents, the biggest benefit would undoubtedly be consumer protection. As we have seen in countless other markets, including the UK and Ontario, players move from offshore to regulated platforms. Many would argue that it is no longer a case of ‘if but when’ when considering the next steps. iGaming is here, and the question is how to ensure it evolves in a way that offers maximum benefit to the state’s residents.
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