Cuomo Signs New York Casino Expansion Law

Would be permitted if voters agree in fall statewide referendum.

New York Gov. Andrew Cuomo has signed into law a measure sharply increasing the number of Las Vegas-style casinos permitted in the state, if voters agree to go along with the idea in a statewide referendum this fall.

The signature of the bill, which was expected given that Cuomo negotiated its terms with lawmakers, clears the final hurdle for consideration of a plan by voters in November whether to revise the constitution to permit up to seven new casinos, offering both real slot machines and table games, in New York.

A separate enabling bill, which can be altered in the future, accompanies the effort, but does not need voter approval; it identifies the general geographic areas of upstate where the first four casinos may be 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,'' Cuomo said in a statement.

The casino plan offers direct new competition for horse racing, though officials say there are built-in protections, such as establishing dollar floors below which purse and breeding fund payments cannot fall.

Genting New York, operators of the successful casino at Aqueduct Racetrack, was not successful in its bid to go from a racino with video lottery terminals to a full-blown facility with real slots and table games such as poker. But it was able to get assurances in the new bill that no new casino competition will be allowed in New York City and the downstate suburbs for at least seven years, a deal that will protect during that time period such things as purse levels that have jumped since the casino opened a couple of years ago.

Under the terms of the enabling bill, three upstate areas are eligible: the Catskills and Mid-Hudson Valley region, the greater Albany and Saratoga Springs area, and a region in the southern tier of the state east of Binghamton. One of those regions can have up to two casinos, a likely bow to the Catskills where some communities have been pushing for decades for gambling to provide an economic development boost.

Banned from new casino development upstate are three areas home to existing casinos operated by Native American tribes, which settled recent disputes with Cuomo to ensure gambling exclusivity rights. Those areas are in the western, northern and central New York areas.

If the referendum fails, those three areas, as well as Nassau County on Long Island, will be allowed to open one casino apiece with gambling limited to video lottery terminals.

The two government-run, off-track betting corporations on Long Island will, if the referendum passes, be permitted to operate up to 1,000 VLTs apiece in new gambling facilities.

A board will be selected by the state Gaming Commission to recommend casino operators and locations. Operators will pay between 37% to 45% of slot revenues to the state, but will have table game revenue sharing payments capped at 10% of revenues.

Cuomo believes the plan will create major, "destination-style" casino resorts, though some industry officials are skeptical that the Northeast can continue to handle an increasingly saturated gambling marketplace.