Cuomo’s budget calls for few changes in gaming law




Albany – Gov. Andrew Cuomo’s 2018-19 budget plan has proposed some subtle changes in the state’s gaming industry, which includes horse racing, video lottery, harness track, racinos and full-scale casinos.

But some observers have expressed disappointment with the budget plan’s overall lack of attention to the gaming industry,

“A big zero,” said Donald Groth, president and CEO of the Catskill OTB, who wants to be able to offer video lottery terminals, or VLTs, in his parlors.

Other struggling Off-Track Betting operators including Capital District OTB had previously sought permission to install the slot-like terminals but have been denied.

The problem, Groth said, is traditional OTB parlors like Catskill and Capital District still rely on horse wagering, even as other forms of gambling are coming on line.

The Long Island OTBs in Nassau and Suffolk counties were both allowed to deploy VLTs, offering gamblers yet another option.

With upstate New York’s fourth Las Vegas-style casino set to open in February, the Empire State and its neighbors appear to be saturated with casino options, said Alan Woinski, president of Gaming USA, a gaming-industry news service.

In keeping with that, some of the governor’s budget proposal call for simplifying and streamlining the rules and tax brackets that VLT racinos pay to the state. For instance, they want to lower from 27 to 7 the various tax rates that racinos across the state pay.


The proposal also seeks to eliminate a hold-harmless provision that would have made casinos give money to racinos in their geographical regions if they cut into their business and the taxable money available for the state. That hasn’t yet happened, so the governor wants to eliminate the hold-harmless clause.

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There are three Las Vegas-style casinos across upstate: Tioga Downs in Tioga County; del Lago in the Seneca County community of Tyre; and Rivers in Schenectady.

A fourth, Resorts World Catskills, is set to open near Monticello in February.

The existing casinos’ operators have been saying in recent months that revenues haven’t met their expectations.

“The reality is the reason why the three casinos are not doing well is because they are still competing with the (racino) race tracks,” Woinski said.

In December, Schenectady officials reported that they wouldn’t be getting as much tax revenue as they had expected from Rivers. While they earlier said the casino, which opened approximately 11 months ago, would allow them to cut property taxes by 18 percent, the final number came in at only 1 percent.


Additionally, Moody’s Investor Services recently downgraded its rating for the del Lago resort to a negative outlook. While initially projected to earn $250 million in its first year, the operation, nine months after opening, will make $150 million, according to Moody’s.

News of the lower revenue shouldn’t mean the casinos should pay less to their host communities, said Westchester Democratic Assemblyman Gary Pretlow, who chairs the Racing and Wagering Committee.

“They are making money,” he said. “But they had these glossy, flowery projections.”

Adding to the list of worriers are horse breeders and racers, especially in the state’s struggling harness racing industry.

Harness tracks are connected to the VLT parlors and revenues from the slots have long helped support the racing.

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With the competition from new gaming venues, many expect an ongoing slide in VLT revenue, which will ultimately mean less for the harness people including New York farmers who have more than 1,000 breeding mares.

“Every one of those horses needs food, shelter and care so it’s a huge agricultural program,” said Betty Holt, executive director of the Harness Horse Breeders of New York State.


rkarlin@timesunion.com 518 478 0309 @RickKarlinTU



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