New York City casinos: What to know about the state’s big bet

New York City casinos: What to know about the state’s big bet
Wild Casino

Like it or not, full-scale casinos are on their way to New York City and the greater metro area.

Earlier this month, Gov. Kathy Hochul and state lawmakers fast-tracked the approval process for the state’s final three remaining casino licenses, which are destined for downstate after the first four were reserved for regions north.

Casino operators have had their eye on New York City for decades, and in recent months, more than a handful of major players – including Las Vegas Sands and Hard Rock International – have expressed interest.

But it’s still too soon to say exactly where the casinos will go, though New York City Mayor Eric Adams has made clear he’s hoping for multiple facilities.

“We would like to have two in New York City,” he said last month. “I think it would be a great boost for the economy, and we are evaluating what are the best locations."

But ultimately it's not the mayor's call – though he will have some say. And critics of casinos and the negative effects of gambling remain, particularly in Manhattan, where local resistance could help keep casinos out.

Here’s what to know about the state’s foray into New York City casinos and how it came about.

How did the state fast-track New York City casinos?

In 2014, New York voters approved a constitutional amendment that allowed the state to issue up to seven private, full-scale casino licenses. An accompanying law restricted the first four of those licenses to regions upstate, giving them time to get established without getting swallowed up by potential casinos in the New York City area.

Under the original law, the state Gaming Commission couldn’t begin the casino-licensing process for the final three licenses – which aren’t restricted by geography – until at least 2023.

Hochul and lawmakers changed that earlier this month. As part of the state budget, they gave the green light to start the process right away.

That doesn’t mean casinos will be opening their doors in New York City anytime soon. The approval process is lengthy. But it does quicken the pace by several months and it means the state will see major licensing fees – at least $500 million per remaining casino license – sooner than it would have under the prior law.

As for taxes, the rates will ultimately be determined by the competitive bidding process for the licenses, but the law says they can’t be less than 25% of slot revenue and 10% of table game revenue. It’s likely to be higher, at least on the slot side: The four upstate casinos all pay between 30% and 40%.

Will local officials and the public have any say?

State lawmakers made two major changes to the state’s casino-siting process.

The first requires all casino proposals to follow local zoning rules and procedures. That’s a big deal in New York City in particular, because the law makes clear that the city's lengthy land-use review process will apply. That adds another layer of review, requires a public hearing and brings the local community board, borough president, City Planning Commission and, crucially, the City Council into the process.

The second change is the creation of new community advisory committees.

State law requires some show of community support for a particular casino proposal before it’s approved. Under the new version of the law, any casino proposal will trigger the creation of a five- or six-member committee (depending on the location) made up of people appointed by local elected officials. In the city, the mayor, borough president and three local lawmakers – the state senator, state Assembly member and City Councilmember where a casino is proposed – all will get an appointee.

A majority vote would be required to show community support early on in the approval process. Otherwise, the proposal won’t move on to the Gaming Facilities Location Board, a five-member panel appointed by the Gaming Commission that will ultimately award the casino licenses.

To some, the local boards are viewed as a “poison pill” designed to keep casinos out of Manhattan, where many local officials have already expressed opposition. But state Sen. Brad Hoylman – a Manhattan Democrat who says he’s an “ardent skeptic on casinos” – said he will participate with an open mind.

"Where casinos are proposed is going to be of keen interest for all local government officials,” he said.

Wait – doesn’t New York City already have a casino?

Yes, but not a full-scale one.

The Aqueduct Racetrack in Queens is home to the massive Resorts World New York City casino, home to a 330,000-square-foot gaming floor with more than 6,500 slot machines. It’s operated by Genting, the Malaysian casino giant.

It’s a similar story at Yonkers Raceway just to the north of the city. That track is home to Empire City Casino, operated by MGM.

Neither of those facilities have full-scale casino licenses. They’re only allowed to have video-lottery terminals.

A full-scale license, like the three now up for grabs, allows for human-staffed table games like blackjack, poker, roulette and the like. It also allows for in-person sports betting.

Who is going to be bidding on the casino licenses? And where might the casinos go?

Casino operators are being fairly tight-lipped in public about any specific plans. There are two exceptions, though: Genting and MGM, which are all in on seeking a full-scale casino license for their existing racetrack casinos.

We also know of several other major casino operators that have, at the very least, expressed interest in one of the three remaining licenses.

Last year, the Gaming Commission issued a “request for information” from those who may be interested in the licenses. And the commission got a number of replies from major operators, including:

  • Las Vegas Sands
  • Wynn Resorts
  • Hard Rock International
  • Bally’s Corp.

Those casino operators didn’t show their hand when it came to where their proposals may be located, but Hoylman said he has been in touch with Hard Rock and they’re eyeing somewhere on Broadway. Las Vegas Sands, meanwhile, has reportedly been eyeing land near Citi Field in Queens.

The commission also received submissions from labor unions, local officials (including now-City Council Speaker Adrienne Adams, who signaled her “full support” for the Resorts World casino in Queens) and even Michael “Buzzy” O’Keefe, who runs The Water Club, an upscale restaurant with a sweeping view on the East River in Manhattan.

Like many other observers, O’Keefe is operating under the assumption that Resorts World and Empire City Casino will have the inside track on a full-scale license.

That leaves one license left, and O’Keefe thinks it should be a small casino in Manhattan for high rollers. Only table games, no slots. The kind of place where “maybe the next James Bond can play a hand of poker,” as O’Keefe wrote to the commission.

"The third one should be a small, elegant casino in the style of Monte Carlo,” O’Keefe said in an interview. “And I just thought this was kind of a neat place to put it."

So what happens next? And when might the casinos open?

The state Gaming Commission, which regulates the lottery and casinos in New York, has 180 days from the passage of the budget to appoint at least three of the five members of the Gaming Facilities Location Board, the panel that will ultimately award the casino licenses.

There are strict rules about who can sit on that board, according to state law. They have to be a resident of the state, and they can’t be an elected official. They also have to have at least 10 years of experience in “fiscal matters” and have experience in accounting, commercial real estate or economics, or have had a “fiduciary responsibility” at a major organization or foundation.

Once a majority of the board is in place, the Gaming Commission would have 90 days to issue a request for applications, which would kick off the whole approval process. So the absolute latest that could happen is Jan. 6.

From there, it’s on to the approval process – which is expected to be months long. And once the casinos are awarded, there would be a buildout process before they could begin operation.

So if you had money on New York City casinos opening in 2023, you should have bet the over.