Online Gambling Bills Put Forward in New York Senate

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Staff member
May 3, 2008
Legalising sports betting is not the only thing brought on the table by the New York Senate. New reports say that an online gambling bill, with a focus on online poker, has been put forward by the New York State Senator Joseph Addabbo, too.

Addabbo has sponsored the online poker bill that would initially provide online gambling licenses to 11 online operators. The licenses will be restricted to already licensed video lottery and tribal gaming facilities.

New York Senator Joseph Addabbo’s Bills

Joseph Addabbo is born and raised in Queens, New York and is now serving as a New York State Senator, recently appointed as Chair of Senate Racing, Gaming and Wagering Committee. Following several failed attempts by the Senate at bringing regulated and licensed online poker to the Empire State, Addabbo has finally introduced the S18 bill to resolve this issue, alongside the Bill S17 to amend pari-mutuel wagering, racing and breeding law and regulate sports betting and mobile sports betting.

The Bill S17 will ask operators to pay 8.5% tax on gross revenue for sports wagering and a 0.2% royalty fee to the State for sports governing bodies. The operators would have to report their operations and ban sports betting on high school sports events.

The Senator’s online poker bill asks operators to pay a $10 million fee up-front for a 10-year license. The operators will not have a limit on the number of skins they could deploy but will have to pay a 15% tax on gross gaming revenue. Each and every one of their skins would have to be thoroughly reviewed and approved by the New York State Gaming Commission.

In addition, the operators will only be allowed to offer online poker rooms, while any other type of online casino game or sports betting will not be included. The prospective players to the online poker games would have to be from within New York borders and 21 years old or over. Any tribal and commercial gaming operator would be eligible to apply for the license, with certain exceptions.

The bill will not treat lightly those operators who continued to operate in New York despite the 2006 UIGEA (Unlawful Internet Gambling Enforcement Act). Those operators will be banned from applying for an online poker license. In addition, all new applicants who have bought out such operator or have employed individuals who have worked for such operators will be denied a license effective immediately. Therefore, the new applicants would have to be careful about who they choose to employ and forget about buying out operators who have had operations running in New York despite the UIGEA.

Addabbo also addressed sports wagering revenue, giving the green lights to the Oneida Indian Nation to prepare for sports betting operation in near future.

Is New York Ready for an Online Poker Bill?

As tough the limitations to Addabbo’s online poker bill are, with the $10 million for a 10-year license, the 15% tax, and the restrictions to unlawful operators, the bill is yet to be passed. A month ago, Gary Pretlow, New York Assemblyman gave an interview saying that if he were to make a choice between online poker and sports betting, he would eventually give up poker. He would choose sports betting over online poker because the revenue is much better with sports betting than online poker and it could bring more lucrative opportunities for the States’ gambling industry.

These comments by the Assemblyman clearly show that maybe New York is still not ready to handle both sports betting and online poker. And, the Assemblyman’s statement is essential here, considering that this marks the sixth year in a row that the New York State legislators have proposed on online poker bill. In fact, just last year, the bill passed the Senate but couldn’t get enough support in the Assembly. There is, however, a difference between previous bills and the current one, and that’s the inclusion of a clause for the restriction to unlawful operators.

Clearing the State’s Assembly would be a big hurdle. It is clear by Pretlow’s statement that the bill won't get a full backing since the Assemblyman has been really vocal about his preference. However, what might help here is the Addabbo’s decision to begin the process to introduce sports betting this year, so this may sway Gary Pretlow to support the online poker bill once sports betting is all up and running.
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