Sports betting touted as potential source of new state revenue

Assemblyman Gary Pretlow, chairman of the Gaming Committee in the lower house of the State Legislature, said he is optimistic the bar against sports betting will be removed in December when the high court hears a case stemming from New Jersey.

If the Professional and Amateur Sports Protection Act is struck down, the outcome favored by the gaming industry, Pretlow said he would then promote legislation to all New York's regional off-track betting corporations to participate in bookmaking for sporting contests.

He said that while the issue is still being researched by lawyers, it appears that a constitutional amendment would be required to allow OTBs to take that form of gambling action.
In that event, lawmakers would likely pass the enabling legislation in the coming year and the following year to set the stage for a statewide ballot question in November 2019.

Money maker

Sports betting has already become a major revenue source for the one state that has opened its doors to this form of wagering. Nevada reported last month that sports betting there hit an all-time high in September, with gamblers wagering US$ 558.2 million on athletic events. Analysts said betting on football was particularly strong.

The expansion of gambling has become a popular way for many states to raise new revenue and balance budgets without having to resort to often politically unpopular options such as raising taxes or slashing services.

Gaming experts estimate that illegal sports betting via domestic bookmakers and off-shore websites has grown into a US$ 150 billion-a-year industry.
The NCAA, Major League Baseball, the National Football League, National Basketball Association and National Hockey League all want to keep the current prohibition intact. The professional sports leagues are backing the NCAA's litigation that challenges New Jersey's effort to legalize it. "If the U.S. Supreme Court rules favorably on New Jersey's behalf, then New York is ready to go," Pretlow told CNHI.

Bookies

Pretlow said sports betting is prevalent throughout the United States even though it is allowed only in Nevada, with gamblers making arrangements with illegal bookmaking operations to take bets on their favorite teams. He also noted that if it does become allowed in New Jersey, New York would be losing out on a substantial source of revenue if it did not welcome sports betting.

Current state gaming laws would allow sports betting in New York should the Supreme Court knock out the prohibition, said another key player on gambling legislation, Sen. John Bonacic, chairman of the Senate Gaming Committee.

In a statement, Bonacic, whose district includes several towns in Delaware County as well as the site of a Sullivan County casino, was noncommittal on whether the OTBs should be allowed to add sports betting to their menu of gaming options. "Other entities are seeking the opportunity to offer it as well," Bonacic said. "This will be the subject of much discussion in the next legislative session."

High demand

How much the entry of sports betting would impact other types of gambling - the state-run lottery, off-track betting parlors, casinos and horse racing - remains to be seen.

Assemblyman Billy Jones said the outcome of the Supreme Court case arguments are slated to be heard in early December - will be closely watched by New York legislators. "One thing is clear, and that is there is a demand for sports betting in New York state," he said, noting he would favor putting all gaming venues, including the OTB parlors, race tracks and casinos, on a "fair playing field."

Gary Greenberg, a minority investor in Vernon Downs, an Oneida County complex that offers harness racing and video lottery terminals, said he believes the racinos should be the first to offer sports betting in New York.

The biggest hit would be felt by illegal bookmakers handling sports bets now, he pointed out, comparing the introduction of legalized betting on athletic events to the introduction of state lotteries, which decimated illicit numbers rackets popular in many cities decades ago. "We should make this legal so people can just go into a racino or wherever and make their bets," Greenberg said.

The constitutional amendment that allowed non-Indian casinos to open in New York was approved by state voters four years ago. That is the measure that would permit wagering on athletic contests, Pretlow said.

Tough to oppose

An anti-gambling activisit who led the fight against that amendment, Stephen Shafer, conceded that would be no chance of stopping sports betting in New York should the Supreme Court side with New Jersey Gov. Chris Christie, an ally of Atlantic City gaming interests. "Honestly, I don't think we have the clout to fight it at this point," said Shafer, chairman of the Coalition Against Gambling in New York. He predicted that sports betting will be "pushed very hard" by state lawmakers.

Casino revenues

New York's three new non-Indian casinos - in Schenectady, the Finger Lakes and Tioga Downs - were opened after voters approved the constitutional amendment in 2013.
They have generated less business than developers projected. But Gov. Andrew Cuomo has sought to downplay the impact of their performance, saying the revenue the state is getting from them is money that would not be flowing to state coffers if they were not open.

This week, less than a year after it opened, the Schenectady casino confirmed it has parted company with its general manager, Mary Cheeks, for reasons that were not announced, the Albany Business Review reported. A fourth non-Indian casino, Resorts World Catskills, is being built on the site of the former Concord Hotel in Sullivan County and is slated to open in 2018.
New York's gaming options expanded yet again last year when lawmakers allowed betting on fantasy sports.