The panel charged with determining where to locate New York City-area casinos issued a request for applications (RFA) on Tuesday in its first public meeting, signaling the start of the expensive, high-stakes competition for the three licenses being dangled.
The Gaming Facility Location Board, part of the New York State Gaming Commission, announced that the license fee will be at least $500 million — though companies may offer more as part of the competitive bidding — and that the minimum capital investment required of any interested parties is also $500 million. It also said any licenses issued will last no longer than 10 years.
The tax rate, too, will be part of the competitive bidding process, though New York law requires that it be at least 25% on gross gaming revenue from slots and 10% for GGR on all other sources.
Board adheres to timetable
The gaming commission on Oct. 4 named the first three members of the location board — Quenia Abreu, Vicki L. Been, and Stuart Rabinowitz — to give it a quorum and called upon them to issue an RFA within 90 days. Any bidders will first be required to gain two-thirds approval from a community advisory committee and to satisfy all zoning requirements.
“Only projects that have been embraced by the community will ultimately be presented to you for your consideration,” Brian O’Dwyer, chairman of the gaming commission, told the board Tuesday. “As this process unfolds, you’ll hear from a variety of communities and stakeholders with varied positions on any proposed subject. Such public comment should be considered by this board. There is no pre-ordained conclusion to this process.”
The Yonkers and Aqueduct racinos have been considered virtual locks for two of the licenses since they would simply have to expand by adding Las Vegas-style casino games such as blackjack and poker. The third license is considered up for grabs, with some of the most powerful developers in New York and several of the iconic names in the gambling industry already showing interest.
Proposals abound all over town
New York Mets owner Steven Cohen has shown interest in building a casino near Citi Field in Queens, while the New York Yankees have a stake in Legends Entertainment that is part of a partnership looking to build a casino in Coney Island. Other proposals that have gone public include a high-rise casino project in Times Square and another project in Manhattan’s Hudson Yards. Locations in Staten Island, the Bronx, and Long Island have also been named in proposals.
The three casinos were included in the referendum New York voters approved in 2013. That constitutional amendment allowed for seven commercial casinos to be built. The first four went to upstate locations, and those casinos received a seven-year head start on any downstate venues.
The RFA was adopted unanimously without discussion on Tuesday. In 2014, a similar panel announced capital requirements of $350 million for the upstate casinos. Rabinowitz, formerly the longtime president of Hofstra University, was on that panel, too. Upstate casinos then were required to pay $50 million in licensing fees, one-tenth what downstate casinos are being charged this time around.
“Time has gone by, prices have gone up, communities have evolved, and this, we think, is a fair amount, without trying to distinguish the impossible, which is to take one neighborhood versus another,” Rabinowitz said. “We have a uniform license fee.”
By including the casino licenses in the 2022-23 fiscal year budget, state lawmakers and Gov. Kathy Hochul sped up the process by a year in hopes of generating new revenue for a state still recovering from the COVID pandemic. Once the board does its work, the gaming commission will have the ultimate say over which proposals receive licenses. The earliest any casino site is likely to be approved is late this year.
“I am looking forward to a transparent, accurate, and speedy process from the New York Gaming Facility Location Board, under the guidance of the Gaming Commission,” said New York state Sen. Joseph Addabbo, Jr., the chair of the Senate Committee on Racing, Gaming, and Wagering, in a statement released shortly after the public meeting. “I have faith that the Location Board will thoroughly examine each RFA and make the best short- and long-term decision, based on their set of criteria. The quicker the three licenses are approved, the quicker we can begin to realize the major benefits to the state, such as thousands of construction and post-construction jobs, billions in revenue from the licenses, an increase in problem gambling monies and programs, as well as billions more in educational funding when the winning casinos go live.”