The state of New York has included a plan to roll out online sports betting in its 2021-22 budget.
After days of internal wrangling the news online sportsbooks and bettors everywhere finally got the news they wanted – but it does come with a caveat. Or many caveats.
The plan to roll out online sports betting in NY is complicated, and could yet get very messy. It effectively creates the state monopoly Governor Andrew Cuomo had lobbied strongly for.
The push to legalize online betting in the state came partly on the back of seeing the riches neighboring New Jersey is already raking in through new tax revenues. Cash is needed everywhere right now to offset the bitter impact of COVID-19.
New York, previous to this week, only allowed sports betting in a few upstate casinos. All that is about to change, but the complexity of the plan means it’s anybody’s guess how much return NY will eventually get. The talk up to now has been of up to $500million in tax revenues annually. That would be from year three.
NY plan for online betting
As it stands, the next steps to roll out online sports betting in New York are as follows:
- The New York State Gaming Commission will oversee a competitive bidding process (from July 1)
- The winning bids will be announced not later than 150 days after that process starts
- This bidding process will result in two platform providers being chosen to deliver online betting
- These platform providers will have the option to operate at least four mobile betting skins
- Each platform provider would pay a one-time $25million fee for a 10-year license
- Each provider would also pay $5million annually to the casino housing its servers
- The tax rate would be worked out and agreed during the bidding process
The aim is to have online betting apps fully operational in time for Super Bowl LVI in February 2022.
One potential sticking point during this week’s wrangling is the issue of tribal lands in the state – and this is catered for to an extent in the legislation.
The NYSGC will put together a points scoring system to mark bids during the RFP process. And any provider which has a revenue-sharing deal with tribes would score extra points.
There are currently around 20 states which have already legalized sports betting since PASPA was struck down in May 2018. But some of the biggest fish for sportsbooks have yet to be caught.
New York (retail only) as well as Florida, Texas and California (no legal sports betting at all yet) bring in a combined population of more than 100million. They are seen as the potential jewels in the crown of what promises to be a mammoth industry in the next 10 years.