NEW YORK—Legalizing casinos means more money for state coffers, so says Gov. Andrew Cuomo. He has been pushing a statewide referendum to allow the state to license up to seven new casinos. Voters will decide on Tuesday.
The state Division of the Budget estimates casinos could bring in $430 million in new revenue.
Building the casinos could take a number of years, as licenses would need to be awarded, and environmental quality reviews in the forest areas completed.
Former chair of the state regulator of casinos, the Racing and Wagering Board, John Sabini, who spoke with City & State Nov. 1, said financing new casinos may not be easy:
“I think the financial markets are going to be a little skeptical about investing a lot upstate in a resort-casino ... the days when banks lent to casinos with a blind eye are gone, because they know that they are not all going to be profitable right away.”
At least six proposals, each of which would cost around $500 million dollars according to the New York Times, are likely to vie for one or two licenses in the Catskills if the referendum is approved. Four casino licenses would be awarded to operators in Westchester, Rockland, and Putnam counties.
In seven years time, the referendum allows for another three casinos to be approved in New York City and surrounding counties, raising the possibility that in time prospective New York City gamblers would loose interest in visiting upstate resorts.
Customers
Sabini pointed out that history has shown that proximity to patrons decides a casino’s fate.
Upstate casinos may be too far for city patrons. Only resort-casinos in the Catskills, some 90 miles away, will be able to compete with Sands Casino Resort in Bethlehem, Pa., 80 miles away; Foxwoods Resort Casino, in Connecticut, 141 miles away; or Atlantic City, N.J., 125 miles away.
“Its going to be hard to assemble the capital to build grandiose places in those places because the banks have gotten smarter,” said Sabini.
On Friday, Nov. 1, State Comptroller Tom DiNapoli said he doesn’t believe casinos will create the long term revenue supporters predict. At the same time, the state’s fiscal officer said he isn’t taking a stance on the Nov. 5 referendum.
“To project significant revenue growth would be a mistake,” he said, speaking with editors at Bloomberg news. “There’s a big question mark if there is a sustainable economic development benefit for the state.”
