The future of legal sports betting in New York is in limbo after bills providing a regulatory framework died in the Senate and Assembly when the legislature adjourned for the year last Wednesday.
It’s still possible the state Gaming Commission will craft rules to allow the state’s four new commercial casinos to open sports books, which the commission may do under provisions in the 2013 amendment to the state Constitution that authorized the casinos.
However, extending those operations to satellite sites at racetracks, racinos and OTBs and to mobile devices, which the Senate and Assembly bills provided. Face a raft of legal and political obstacles.
For one thing, the 2013 amendment has no provision allowing online gambling. As Bennett Liebman, a legal expert who previously served as the state deputy secretary for gaming and racing, put it, “There are real issues as to whether or not under the existing Constitution you can expand sports gambling to sites other than the physical locations of the casinos.”
The state’s gaming tribes present another sizable obstacle.
The Oneida Indian Nation, for one, has stated it will offer sports betting at its three central New York casinos if it is legalized at the commercial casinos. But it will oppose any competitive intrusion, whether via the internet or satellite venue, in the exclusivity zone guaranteed the tribe under its federally mandated gaming compact with the state. The zone covers a 10-county region for which the tribe pays the state and its host counties 25 percent of its machine gaming revenues, a sum amounting to around $200 million over the last five years.
“There are serious questions that must first be addressed before legalizing mobile sports betting,” said Oneida spokesman Joel Barkin.
There is precedent for New York’s tribes to withhold revenue-sharing if they feel their compact rights have been violated. The Seneca Nation, which operates three casinos in western New York, stopped making roughly $100 million in annual payments to state in 2017. The Senecas argue the payment requirement expired under the terms of its compact. But the state’s decision to license one of the commercial casinos within a few miles of the Senecas’ exclusivity zone may have factored in the tribe’s decision.
“It’s pretty simple math to realize that losing that $200 million in return for something less𑁋even if $10 million to $30 million is a conservative guess𑁋is not a good deal,” said Clyde Barrow, an industry expert and professor at the University of Texas Rio Grande Valley. “The tribes are going to argue that (violating exclusivity) is exactly what you’re doing (with mobile betting).”
