New York’s Sports Betting: A Yin and Yang of Growth and Challenges
Mobile Mania Drives Market Boom, But Negotiations Cloud the Future
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New York’s sports betting market is surging. Fueled by the ease of mobile apps, fans are betting online more money than ever before. However, the state faces challenges, particularly with the ongoing Seneca Casino Compact negotiations.
Record-Breaking Sports Betting Revenue
In May, New York’s sports betting revenue surpassed the $200 million mark according to betting news reports, driven mainly by mobile betting.
The New York State Gaming Commission reported a total gross gaming revenue (GGR) of $203.3 million for the month.
This achievement marks only the second time GGR has exceeded $200 million in a month, the first being January 2024, with a total of $211.5 million. Compared to May 2023, this represents a 33.8% increase.
The mobile sports betting handle in May reached $1.97 billion, a 45.9% year-on-year increase and the highest since the record-breaking month of November 2023.
The net revenue for platform providers stood at $99.6 million, the second-highest since New York’s legal sports betting market launched in January 2022.
The Seneca Casino Compact Stalemate
Despite the booming in online gambling and sports betting revenue, New York faces challenges with the Seneca Casino Compact negotiations.
Seneca Nation officials have described their negotiations with New York Governor Kathy Hochul as “painstaking, frustrating, and disappointing.” Since the tribe’s Class III gaming compact expired in December 2022, little progress has been made.
The compact grants the Seneca Nation exclusive rights to slot machines and live dealer table games west of State Route 14 in upstate New York. In return, the tribe directs 25% of their slot machine revenue to the state. However, the Senecas have been placing this revenue in an escrow account since January 1, 2023, due to the expired compact.
The Seneca Nation is seeking a reduced slot tax, arguing that the authorization of four upstate commercial casinos with similar gaming offerings has impacted their revenue. They are also requesting permission to open a casino in the Rochester area, a proposal that has faced significant opposition from local officials and state lawmakers.
Political insiders suggest that Governor Hochul is in no hurry to finalize a new compact, as it might result in reduced revenue for the state from the Seneca casinos.
This delay has caused frustration among tribal leaders and has led to funding gaps in local municipalities that rely on slot tax revenue. State Senator George Borrello has voiced concerns about the impact on small municipalities in his district.
The expired Class III gaming compact’s latest extension runs through the end of the month. Moreover, the terms require a further extension if a new agreement isn’t reached.
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