New York Online Casinos Bill Opposed by Local Casino Workers

Article ByDavid Weir

February 20, 2024

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Posted in: New York Gambling News, US Casino News, US Gambling News

Senator Joseph Addabbo (D-15) filed an online casino bill last month, and this month he’s been bashed by a local union (including hundreds of casino workers) over the idea.

Senate Bill S8185 was filed in January and mirrors a similar bill Senator Addabbo filed in early 2023.

However, like its failed counterpart from last year, it has seen little support so far. New York governor Kathy Hochul excluded it from her recent executive budget, suggesting the issue doesn’t have her priority attention.

Nevertheless, some 700 workers, most of whom work at the video lottery gaming Resorts World Casino in Queens (pictured), signed an open letter to Sen. Addabbo this week, criticizing his decision to once again propose online casinos.

Addabbo says that the potential taxes could fill the state’s massive budget shortfall. The influential Hotel & Gaming Trades Council union argues that online casinos would be bad for physical casinos’ revenues. That is a point that has been hotly contested in various markets.

“When customers come to a racino, VLT [Video Lottery Terminal] parlor, or casino, they support all of our jobs, including cooks, bartenders, servers, maintenance workers, and hotel workers,” the union letter said.

Cannibalization Fears

The idea that online casinos take business away from physical casinos has been widely debated in the gambling business and by lawmakers, with various studies showing evidence for either side.

In New York’s case, many probably look to their neighbor in New Jersey’s online casinos.

The results there are not good for those who argue that no cannibalization happens.

Although the physical New Jersey casinos in Atlantic City still reign as the biggest driver of gambling revenues, the gap between them and online casinos has fast been narrowing.

In January, New Jersey gambling revenues hit a record high. However, physical casino gambling was down, and online casinos were up a lot. They hit $183 million in revenues for the month, compared to the nine Atlantic City casinos, which collectively declined 3% year-on-year to $205 million.

While there may be other reasons for Atlantic City casinos’ declines, including public safety issues, the stats don’t look good from the point of view of casino workers in New York.

“We know that if, instead, they were to game from their homes, workplaces, or elsewhere, their dollars would go straight into the pockets of gaming companies, rather than to support the livelihoods of thousands of New Yorkers who support the state’s gaming industry,” the letter said.

Online Casinos too Far?

Addabbo has said that online casino legalization could bring in a hefty $800 million to $1 billion in taxes annually for the state.

In the majority of other U.S. states, that would be big news. For example, in Delaware, which has online casinos, the state budget is $6 billion overall.

But in New York, the state is projected to have a $269 billion budget for 2025. And that budget already includes a lot of gambling revenues.

The taxman is taking in hundreds of millions a month in tax from New York sports betting, which is the nation’s largest market. It is also looking to see a windfall of several billion dollars when the New York Gaming Commission hands out three new licenses for downstate New York casinos in either late 2024 or early 2025.

Some analysts predict that the three new venues could rival Las Vegas as a casino gambling destination, even as the Nevada casinos of Sin City are raking in record revenues themselves.

Given all that, it seems that locals and state lawmakers have little appetite for expanding the gambling options further with online casinos.

One union leader, Bhav Tibrewal, brought up Sen. Addabbo’s history of campaign contributions from online casino operators like DraftKings and FanDuel, which total around $70,000.

The Trades Council represents lots of casino resort workers. It did not point out that various physical New York casinos, unions, and other business sectors have also donated significant sums to Addabbo’s political campaigns.

That has included Malaysian gambling operator Genting — who own Resorts World and the Saratoga Casino Hotel — as well as the New York Hotel Trades Council, the Plumbers and Pipefitters Local, and the Hotel Restaurant Club Employees and Bartenders Local.