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No state in the US has been hit harder by COVID-19 than New York and in the wake of the pandemic disaster is a massive budget deficit shortfall (estimated to be about $17 billion), caused my massive testing and months of industry shutdown. One obvious way for the state to mitigate some of the losses is to add a mobile betting platform onto its already legal brick-and-mortar sports betting that exists in just four out-of-the-way, upstate casinos. Horse racing in New York will be allowed to commence June 1 but as it stands today, New York residents won’t be able to bet on it.
Senator Joseph Addabbo continues to lead a push toward a viable mobile sports betting platform – his many efforts so far have been foiled by the strange reluctance to seize on the most successful form of betting in the US. Senate Bill 17 is his latest shot and many feel that it is his best chance yet to bring mobile sports betting to the state. Major coronavirus budget shortfalls have thrust mobile sports betting into the spotlight as a way to generate some much-needed revenue for state and local coffers.
“If you weren’t considering mobile sports betting legalization prior to the virus, I think the virus may put you in the position that you almost have to. The economic impact of the Coronavirus is not only for this year, it’s next year too. The idea here is we had a $7 billion deficit before the virus and then the virus hit us with another $10 billion,” said Addabbo. “Now we’re $17 billion in the red and we’re facing education cuts. A portion of our gaming revenue would go toward education, so we would be increasing education funds with mobile sports betting legalization. We’re also facing healthcare cuts, so how do you fend off some of these cuts? Look at the credible, significant, realistic money mobile sports betting would provide.”
Simply put – New York needs money!
The COVID factor
New York, the last few months has generated exactly ZERO sports betting revenue. With the four upstate casinos and seven tribal casinos closed by the global pandemic and a curious lack of mobile betting opportunities, New York's decision to shun mobile betting was seriously exposed.
With life slowly coming back to normal in the US, there are still serious questions about peoples' desire to enter a casino, spend time there and wager their hard-earned dollars in the facilities for betting in the state. New York residents have been among the nation's most ardent supporters of lockdown. When everything opens up, citizens of the hardest-hit state in the US may be reluctant to enter areas where social distancing seems like an impossibility.
What New York is missing out on
Senator Addabbo estimates that New York is missing out of between $160 to $200 million per year from mobile betting alone. It is not lost on New York lawmakers just how much that added revenue would contribute to the state's tax coffers which could be used to help dig the state out of their coronavirus hole.
The state of New York doesn't have to look far to see just what a strong mobile betting presence can do for them. New Jersey, one of the two or three most successful legal betting states has been raking in sports betting dollars from their apps.
New Jersey reported $494.81 million in total handle for February alone, 88.2% or $436.49 million coming via mobile means. That's $436 million of revenue that New York as one of the richest and most populous state is missing out on.
Prior to the COVID outbreak, one study identified $33.81 in sports betting revenue per capita in New Jersey in 2019 with New York earning just $0.85 per capita. New Jersey has generated $273,436,129 in revenue since July, 2019 while New York has made $9,646,708 over that span. The reason? Mobile betting.
Other states continue to absorb New York betting dollars
New Jersey has, and will continue to be the beneficiary of New York's reluctance to bring a mobile sports betting platform into the fold. Some estimates have as much as 25% of New Jersey's incredible monthly handles coming from New York bettors. It is estimated that $837 million has flowed in to New Jersey sportsbooks from New York citizens.
Pennsylvania has proven to be another destination for New York bettors, largely because of their strong mobile betting platform.
It is widely accepted that sports betting legalization in 2020 is a tough ask. New York's legislative session may not return this year and even if it does, there are other priorities that need to be taken care of before the subject of legal sports betting.
So, while the appetite for mobile betting is definitely there in New York and the time seems perfect to welcome in mobile sports betting, the subject will likely and unfortunately have to wait until 2021 at the earliest to get off the ground.