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The toothsome carrot of mobile sports betting will continue to dangle in front of prospective operators and potential customers in New York for a couple more months.
Making an appearance at the Betting on Sports America conference this week, Assemblyman Gary Pretlow laid out the framework for an updated NY online sports betting bill he intends to introduce in the coming weeks.
“Currently, legislation is written and ready to go to allow mobile sports betting throughout the state,” he said. He also intimated he believes the bill turning into law is something like a 50-50 shot to happen this year.
Pretlow introduced an early version (A 6113) in February, and the lawmaking process begins in the Racing and Wagering Committee he chairs. New York has a proud history of spring inactivity on gaming bills to uphold, however, with the legislature in session until late June.
A separate effort to include mobile sports betting language in the state budget already came up short this year.
The updated language to which Pretlow alluded is not yet filed, but he offered some clues about its provisions. And it sounds like they’re mostly aimed at compromise.
As drafted, licenses to offer NY sports betting would cost $12 million apiece — middle ground between the proposed $10 million in the Assembly and $15 million in the Senate. Any eight-figure fee would represent the largest among the eight regulated US jurisdictions.
Upstate NY commercial casinos, however, expect to be exempt. Stacey Rowland, Vice President and General Counsel for Rivers Casino & Resort, interjected with a moment of informal lobbying.
“I would like to mention currently there is no fee for the commercial casinos for their sports wagering,” she said. “So they will be grandfathered in.”
Pretlow did not respond directly, so moderator Kevin J. Weber posed a follow-up to Rowland: “Would Rivers Casino be prepared to pay a $12 million fee?”
“I don’t…,” she searched for a diplomatic response. “We want online registration, so I’ll leave it at that.”
Pretlow’s bill could allow all operators to deploy their mobile betting apps statewide, including within tribal territories. According to the Assemblyman, his first pitch involved geofencing native lands to provide some degree of exclusivity.
“The second,” he said, “would be to open it up for everyone to go statewide — which means the Senecas can offer betting opportunities in New York City, and New York City operators can offer betting opportunities in the Seneca Nation.”
According to the Assemblyman, both the Oneida and the Seneca have agreed in principle to this competitive, statewide model. That news seemed to come as a surprise to his fellow panelists — and it’s news to us, as well. LSR has reached out to the Oneida for confirmation.
The bill will limit skins to either one or two per operator. It’ll be one if the casinos get their wish, while Pretlow would prefer to construct a market with more options.
You can also expect to see Pretlow retain the existing provisions allowing sports leagues to share in the revenue from NY sports betting. As proposed, an integrity fee would be levied at a rate of 0.2% on the total amount wagered.
Here’s an exchange that occurred early in the 45-minute discussion:
Weber: “How do we see the issue of sports leagues requesting the payment of fees on betting handle? I’m not going to call them integrity fees. That’s one of the strange names I don’t want to repeat, because I don’t want to give it any more credence than it already has. We’ll just call them fees on top of betting handle. How do you think that’s going to work out?”
Pretlow: “I changed the name from integrity fee to royalty. And I do think that the leagues supply the product, and they should be entitled to something. And they will experience some additional expenses. Now it’s been said that the value of sports betting is going to [increase their value] exponentially. But to keep labor peace, peace in the world, peace in the Middle East — I threw them a bone.”
The Assemblyman later acknowledged the leagues’ efforts to thwart legalized sports betting in federal court. In the next breath, though, he reaffirmed the obligation he feels to include them in the profits:
“You must realize the most of the leagues are headquartered in New York… and we’ve always had a good working relationship with them. I would like them to stay in New York, and even entice other leagues to move their headquarters to New York.”
Pretlow indicated that the PGA Tour is “totally in favor” of direct compensation from NY sports betting. As it stands today, no sports betting law in the US includes such a fee by any name.
The existing version of the Pretlow bill also mandates the use of official league data.
During the Q&A portion of the discussion, Pretlow fielded a question about the odds of his bill passing this year.
“If I were a bookie,” he smirked, “plus-110.”
The Assemblyman from Queens has always been the optimist among his colleagues, but NY is not one of the states in which there is unanimous support for such legislation.
“I have to convince my conference, the Democrats in the New York State Assembly. I have 74 people who are in favor, and I need 76. So I just need two more to get it to the floor.
“The governor is still pushing back hard for whatever the reason — and I don’t know the reason, but he’s pushing back. He doesn’t want to do this just yet.”
Speaker Carl Heastie is the primary opponent in the Assembly, while the stance of the chief executive has become less clear in recent weeks. Gov. Andrew Cuomo has publicly maintained that mobile betting requires another referendum, but new legal opinions arguing otherwise may have made an impression.
Pretlow also indicated he intends to participate in the Senate hearing on mobile sports betting in two weeks — despite being asked not to attend.
Resident voters of New York implicitly legalized sports betting by way of a constitutional referendum in 2013. The law it spawned permitted the four upstate casinos to open brick-and-mortar sportsbooks, provided the federal landscape turned favorable.
“When I drafted the casino license,” Pretlow said, “I put in the Constitution to allow sports betting should PASPA be overturned. It subsequently was overturned. Hence, sports betting is legal in the state of New York right now.”
But there’s a “but”:
“Unfortunately, I didn’t have the foresight to include mobile. And that’s where the issue is right now. As everyone knows, the bulk of the action comes from mobile betting.”
Policymakers can find confirmation by gazing just across the river. Online/mobile platforms account for more than 80% of the total NJ sports betting handle.
Whether or not NY lawmakers can legally approve mobile betting may ultimately be an issue for the courts to decide, as there seems to be no consensus in the statehouse. Despite Pretlow’s long-suffering optimism, the lack of unity figures to make the road to passage a trying one.
That being said, the upper chamber does support mobile sports betting, with Sen. Joseph Addabbo acting as the Senate sponsor of matching legislation.