Governor Cuomo Signs Legislation Allowing For VLTs At OTBs On Long Island

Governor Andrew M. Cuomo today signed the Upstate NY Gaming Economic Development Act, a comprehensive new law that, pending approval of a referendum this fall, will establish four destination gaming resorts in Upstate New York and boost tourism and economic development in communities across the region. Under the casino gaming plan outlined in the new law, all localities in the state will share in increased education aid, or lower property taxes, no matter where the casinos are located.

“Our focus has been to bring jobs and boost local economies in Upstate New York, where decades of decline have taken their toll in our communities," Governor Cuomo said. "This new law will bring the state one step closer to establishing world-class destination gaming resorts that will attract tourists to Upstate New York and support thousands of good paying jobs as well as new revenue for local businesses. For too many years, gaming revenue has left New York for our neighboring states. Today, we are putting New York State in a position to have those dollars spent here in our communities, which will benefit our local economies and tourism industries, as well as support education and property tax relief."

Senator John Bonacic said, "Casino gaming surrounds us in other States. By legalizing it in New York we can create thousands of jobs and allow for billions of dollars in investment. Gaming can substantially improve the Catskills economy. Governor Cuomo has brought is to the brink of success here. Anyone who wants more money for education and more jobs should vote for the gaming referendum this November."

Assembly Member Gary Pretlow said, “I commend Governor Cuomo for signing this new law that will bring New York State a step closer to bringing casinos to the Catskills, the Southern Tier and the Capital Region. These destination resorts would mean good news for the local communities, the local economies, and the people of our state. Gaming has the potential to create new jobs for New Yorkers and bring downstate residents and tourists to the attractions of Upstate, and this exciting new law will bring put us in a position to make casino gaming an economic driver here in New York State.”

The new law signed today by the Governor includes these key details:

Locations of Destination Gaming Resorts: The new law authorizes four upstate destination gaming resorts to enhance tourism development. Destination gaming resorts will be selected competitively based on the economic development impact of the resort. Destination gaming resorts are authorized in three regions of the state: the Hudson Valley–Catskill area, the Capital District-Saratoga area, and the Central-Southern Tier. One region may have up to two casinos if determined by the state siting board. No destination gaming resorts can be authorized in Westchester, Rockland, Putnam, New York City, or Long Island. There will be a 7-year exclusivity period during which no further destination gaming resorts will be licensed by the State.

Regulation and Selection: The State Gaming Commission will oversee regulation of destination gaming resorts. The Gaming Commission will appoint a siting board of individuals with expertise in finance and development, which will determine the required minimum amount of capital expenditures and license fee required of a destination gaming resort applicant in each region and make the selections.
o The tax rate on slot machines will be equal to the tax rate of existing video lottery gaming facilities within each region which currently ranges from 37 percent to 45 percent depending on the region.
o The tax rate on table games will be 10 percent.
o Existing payments to the racing industry for purses and breeding will be maintained.
o There will be no destination gaming resorts in regions with tribal exclusivity agreements.
The board will be required to evaluate destination gaming resort applications based on specific criteria: 70 percent of the decision on siting a destination gaming resort will be based on economic activity and business development factors; 20 percent on local impact and siting factors; and 10 percent on workforce factors. Local support for the Resort application must be demonstrated as a threshold application requirement.

The Gaming Commission is authorized to investigate the suitability of the gaming license applicant, including character and financial stability, and sets criteria for licensing individuals and businesses employed by or doing business with the resort. Destination gaming resorts and all related service industries will be strictly and comprehensively regulated by the Gaming Commission. The minimum gambling age in destination gaming resorts will be 21, and no smoking will be authorized in the four destination gaming resorts.

All Localities Benefiting from Education Aid Increases: 10 percent of the State’s tax revenues will be split equally between the host municipality and the host county. 10 percent of the State’s tax revenues will go to other counties in the region of the destination gaming resort to provide tax relief or educational assistance. 80 percent of the State’s tax revenues will be used statewide for elementary and secondary education or property tax relief. The educational aid will be additive and will not be part of the State’s existing education formulae. If the gaming referendum passes, 10 percent of the net gaming revenue retained by the State from Indian gaming facilities will be distributed to counties in each respective exclusivity zone that do not otherwise receive a share of exclusivity revenues.

Addressing Problem Gambling and Cheating: Funds for problem gambling will be added through the imposition of a $500 annual fee on all slot machines and table games. Destination gaming resorts will be required to develop comprehensive problem gambling programs, and part of the decision for siting a destination gaming resort will be determined by the quality of the applicant’s problem gambling program. All destination gaming resorts will be required to have exclusion policies, and the new law provides for individuals to exclude themselves from the destination gaming resorts. New categories of gaming specific crimes are included to prevent cheating at destination gaming resorts. Cyber sweepstakes cafes are specifically made criminal.

Preventing Corruption: A state gaming inspector general’s position is authorized to prevent corruption at the Gaming Commission.

Agreements with Indian Gaming: The exclusivity of Indian gaming zones is affirmed.

Video Lottery Terminals: The new law authorizes Nassau and Suffolk OTB to establish one video lottery gaming facility each at an OTB site with a maximum of 1,000 machines at each site. In the event that the gaming referendum does not pass, the Gaming Commission is authorized to competitively site up to four video lottery gaming facilities, one per region, in the Capital District, Central-Southern Tier, Catskills, and Nassau County, based on revenue generation and economic development criteria. Additional video lottery gaming facilities in New York will secure new funding for educational assistance.