Recently, New York Comptroller Thomas DiNapoli issued a report that studied the economic impact of the state’s four licensed commercial casinos in the upstate region. It found that the four gaming locations delivered US$176 million in non-tax gaming revenue for the local governments between 2017 and 2022. But only three smaller towns saw a significant financial benefit.
It should be explained that the four commercial casinos in upstate New York are — del Lago Resort and Casino in Tyre, Rivers Casino and Resort in Schenectady, Resorts World Catskills in Thompson and Tioga Downs Casino in Nichols. The Empire State will also issue three commercial gaming licenses for the downstate region, but those should be announced later in 2023.
- Not Instant Fix to Fiscal Problems
Mr Dinapoli noted that casinos were not an immediate solution to the financial problem, and pointed out that while they generated a lot of tax revenue, the impact on communities receiving those returns differed. He expects the report to provide state and local officials with a new perspective that could help host communities avoid false expectations of casino public positivity.
In 2020, all four casinos failed to meet their expected gross profit targets, according to the report. Studies show that these revenue and tax contributions continue to perform poorly three years later, while reaching 50-60% of estimates. The only exception at the time was Tioga Downs in the Tioga Downs Southern Tier in Southern Tier.
However, local governments enjoyed the benefits of casinos despite their failure to achieve their goals. In three smaller host towns, Nichols, Tyre and Thompson, gambling revenues contributed 30% to 60% of total revenue, which could reduce property taxes. However, in Schenectady, the largest host community, and four host counties, game taxes accounted for 1-3% of total revenue.
Mr Dinapoli noted that the 2020 closure of the business was a major factor in the revenue shortfall, but the total game revenue at the four casinos exceeded the unprecedented level of the situation in 2022. But a change in state gaming laws allowed casinos to maintain a larger portion of the GGR, which didn’t help bring in more local gaming taxes.
- Downstate Casino Expansion Operations
Meanwhile, Empire State is in the process of awarding the remaining three commercial game licenses allocated to downtown New York State. In January of this year, the Game Location Board launched an application request to listen to third-party offers to apply for one of the three licenses available.
One company interested in joining New York’s Downstate Casino environment is Las Vegas Sands. And according to Wells Fargo analyst Daniel Politzer, the operator’s proposal for billions of casino resorts in Nassau County is one of the most popular companies. He attributed this to the size of the project, its performance, and its ability to work well with the community.
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