Funding For Gaming Expansion Outweighs Problem Gambling Measures in New York State

In a report published on Thursday, NY Comptroller Tom DiNapoli calls for policymakers to measure the impact of gaming expansion on problem gambling, as the state’s marketing budget for its gaming activities is much bigger than the sum allocated to tackling problem gambling.

Policymakers Consider Ways of Boosting Gaming Revenue

New York State Comptroller Thomas P. DiNapoli released a report on November 12 on working towards improving the balance between the state’s gaming revenues and problem gambling, as NY gaming activities generated $3.7 billion in turnover in the state fiscal year that ended March 30.

With a decreased performance in 2020 due to the Covid-19 pandemic, the Gaming Commission has been considering ways to expand the gaming industry, Mr. DiNapoli said. He called for the state to “take a closer look” at problem gambling and the impact of gaming facilities and activities in place.

Before policymakers consider an expansion of gaming revenues, the state must take a closer look at the impacts of gaming already in place, as well as problem gambling. https://t.co/D88wWxw26g

— Tom DiNapoli (@NYSComptroller) November 12, 2020

New York State spends more than $270 million every year to promote and market the Lottery and Virtual Lottery Terminals (VLT) in the area. Marketing resources allocated to government-sanctioned gaming activities reached $272 million this year, including $90.8 million to promote the Lottery and education funding. During the previous fiscal year, about $170 million were spent to promote VLT parlors, also called racinos.

Not Enough Options for Treating Problem Gambling

As the state’s marketing budget for betting games greatly exceeds the sum allocated to fighting problem gambling, Mr. DiNapoli said Thursday that policymakers should consider what to focus on.

“State policymakers may wish to consider whether the current levels of resources that are intended to increase gaming activity, and those devoted to mitigating harmful impacts of such activity, strike an appropriate balance,”

Thomas P. DiNapoli, New York State Comptroller

The Office of Addiction Services and Supports (OASAS) said it estimates the state spent $5.7 million in the 2019-2020 fiscal year on “prevention, treatment and recovery services related to problem gambling”, according to Mr. DiNapoli. Few steps were taken to analyze the possible impacts of gaming expansion on New Yorkers susceptible to gambling addiction.

A 2019 audit from Mr. DiNapoli’s office on the efforts made to treat problem gambling in the state found out that very few prevention and treatment programs were available to communities.

State Gambling Revenues Down Compared to 2019

Traditional lottery games generated two-thirds of New York State’s gaming revenues for the 2019-2020 fiscal year, with $2.5 billion. Racinos brought an additional $944 million to the Lottery, as a legal part of the business. From January to September 2020, lottery revenues have declined by $132 million compared to last year’s results, for a total of $958 million.

According to the report, the state expects this year’s gaming revenue to decrease by $616 million due to the multiple closings of casino facilities during the pandemic.

Proposals to offer mobile sports betting were recently submitted, but Governor Andrew Cuomo, who also controls the Gaming Commission, has shown reservations on the topic.

Governor Cuomo allowed New York State’s casinos and racinos to reopen on September 9 at 25% capacity. Approximately 7,000 employees were laid off from the state’s four casinos and eight VLT facilities over the past months. It is unclear how many employees were hired back, the report notes.

Casino Revenue Grows In October

New York’s commercial casinos saw sports betting revenue grow in October, the first full month of sports betting in the state following the coronavirus lockdown.

New York’s casinos have reported an increase in sports betting revenue during their first full month of activity after lockdown mid-March. According to the Gaming Commission, the state’s four commercial casinos generated $2.6 million in gross gaming revenue in October, against $2.2 million in the same month last year.