New York’s four licensed, non-Native American casinos haven’t produced the level of financial benefits state lawmakers anticipated when they authorized them years ago.
That’s the findings of a report issued Thursday by state Comptroller Thomas DiNapoli, whose office reviewed operations at del Lago Resort and Casino, Rivers Casino and Resort, Resorts World Catskills, and Tioga Downs Casino from 2017 to 2022.
While DiNapoli’s office found those casinos generated $176 million in gaming tax revenue for local and regional local governments, the comptroller said only the three smaller towns playing host to casinos realized significant fiscal benefits relative to their overall revenue.
DiNapoli’s office found in 2020 that all four state-sanctioned casinos fell well short of the projected gross revenues on which local taxes are levied. Three years later, he said the revenues and tax contributions continue to lag expectations, reaching only 50% to 60% of initial expectations, with the sole exception of Tioga Downs in the Southern Tier.
Overall, the findings of his office led DiNapoli to concluded casinos “are not a sure bet.”
“Casinos are not a magic fix that will solve local fiscal challenges,” DiNapoli said. “While casinos have generated local gaming tax revenue, the impacts vary for the communities that receive such revenues.”
On the plus side, casino gaming has helped at least three New York towns from a financial standpoint. In towns hosting state-sanctioned casinos, including Nichols, Tyre and Thompson, gaming tax revenue made up 30% to 60% of total revenue, which DiNapoli said allowed those communities to dramatically cut property taxes.
In contrast, DiNapoli’s office said in the larger host city of Schenectady, as well as the four host counties, gaming tax was a much smaller percentage of local revenue, just 1% to 3% of their total revenue.
For regional non-host counties, the comptroller’s office found casino taxes generally amounted to less than .5% of their total revenue.
The comptroller’s report acknowledged that the pandemic contributed to casino shortfalls, noting that gaming sites were shut down for six months in 2020 and did not fully reopen until capacity restrictions were lifted in June 2021. The report noted that all four casinos saw gross gaming revenues exceed pre-pandemic levels in 2022.
However, DiNapoli’s office said the increased revenues did not translate into greater local gaming taxes because state amendments to New York’s gaming law allowed casinos to keep a greater percentage of their gross revenue.
Three casinos were granted cuts in their tax rates for Slot & Electronic Table Games to 30%. A bill to reduce Tioga Downs’ Slot & ETG tax rate to 30% is currently pending approval by Gov. Kathy Hochul.
According to DiNapoli’s office, the tax cuts reduced collections by a combined $41.9 million in 2022, including $8.4 million. Those revenues, DiNapoli said, would have gone to local governments.
In his report, the comptroller stressed the importance for what he described as “realistic fiscal planning by localities regarding expectations for gaming revenues.” He also said for municipalities which will host soon-to-be awarded downstate casinos, an “appropriate plan for the new revenue” will be key.
The report did not examine the non-financial impacts of hosting a casino on issues like gambling addiction or quality of life issues, but DiNapoli said his office is planning to release a report addresses those issues at a later date.
To read the full report released by DiNapoli on Thursday, visit:
https://www.osc.state.ny.us/files/local-government/publications/pdf/2023-casinos.pdf?utm_medium=email&utm_source=govdelivery.