When Gov. Kathy Hochul sped up the process for awarding three casino licenses for the New York City area last spring, setting the gears in motion a year ahead of the original plan, the idea was to inject much-needed tax revenue into a region financially battered by the pandemic.
Now, with the state gaming commission preparing to hear proposals from real estate developers and gaming companies in the coming months, some New York officials would like to see the pace remain brisk.
“I’d love to see the more than $2 billion in license fees added into this fiscal year, which goes until March,” said Joe Addabbo, chairman of the Senate Racing, Gaming and Wagering Committee. “But we’ll see. If you look at the gaming commission, they’re such pros and they did such a good job getting mobile sports betting in before the Super Bowl, which we had to do. I know it’s apples and oranges and the downstate licenses are a complex process, but I know they have the wherewithal to do this in a very professional, credible way, which also means that the timeframe gets expedited a little bit.”
Massive revenue forthcoming
The licensing fee for a downstate casino is no less than $1 billion and the tax rate on slots is no less than 45%, according to the legislation. Addabbo thinks it’s a good sign for the process that brands such as Hard Rock, Wynn, and Caesars are showing interest in teaming with real estate developers in various parts of the city.
“The idea is, now we’re hearing these iconic names and I appreciate their willingness and desire to do business in New York,” he said.
First reported by The New York Times, the latest proposal involves one of the city’s biggest developers, SL Green Realty Corporation, teaming with Caesars Entertainment to build consensus among Times Square businesses to welcome a major casino development in the neighborhood. The Caesars bid is the second Times Square proposal to surface. The other involves Wynn Resorts and Related Companies, with a new casino to be built in Hudson Yards.
Though Addabbo represents the 15th district of Queens and has endorsed Resorts World’s plan for a full-service casino at Aqueduct Racino near JFK Airport, he likes the idea of a Manhattan casino because he thinks it could give the state an edge on the nearby competition. Resorts World and MGM’s property in Yonkers are considered likely recipients of two of the three licenses, but most observers consider the third to be up for grabs. As complicated as a Times Square development might be politically and in terms of construction costs, many believe it also has the most upside as a sustainable revenue machine.
“Manhattan has a built-in tourism base,” Addabbo said. “In my opinion, it’s the one Jersey is most concerned about.”
Location board nearly seated
The next step in the process is to continue filling out the Resort Gaming Facility Location Board, which has only three of five members seated. The current members are Stuart Rabinowitz, president of Hofstra University; Kevin Law, who runs the Long Island Association, a business group; and prominent attorney Dennis Glazer. Once the siting board is set, it can begin hearing formal proposals.
The new Times Square proposal would house a casino at 1515 Broadway, the SL Green skyscraper near West 44th Street. The New York Times obtained a copy of a letter sent from the companies to nearby businesses soliciting support for the casino and promising to use a portion of the revenue it generates to fund safety and sanitation improvements in Times Square, including deploying surveillance drones.
Manhattan might be the most complicated part of the city in whch to get a casino built, in part because of political resistance, but it would give the city a gambling hub to go along with the two expanded casinos in Yonkers and Queens.
“I don’t want something that’s a flash in the pan or is a novelty, like, ‘Wow, this is crazy or different,’ but it’s just a novelty for three to five years,” Addabbo said. “It’s all going to be about longevity, whether it’s sustainable for 15, 20 or 30 years. That’s my concern.”