Seven months after the February 3, 2023 deadline passed, the New York State Gambling Commission and Gaming Facility Location Board has addressed 613 queries submitted about the three Downstate casino licenses to be granted.
The 103 page document answers the array of questions posed by the 11 applicants gunning for an elusive New York land-based license. The regulator also announced that a new question window was open, which will close on October 6, 2023. It has not provided a date for subsequent responses.
What do we now know about licensing?
Answers were comprehensive, covering everything from construction through to licensing and regulation. Most notable for industry observers were the headline-grabbing license fee. Q.395 reads “Will the GFLB allow for discrete license fees by successful Applicants?” to which the GFLB responded “Yes, an applicant may bid a higher licensing fee above the $500 million minimum”.
Further licensing details include that payment of the licensing fee must be made within 60 days from notice of license award. In addition, the GFLB has asserted that “if a proposed capital investment requires a specific term to be a viable project, the applicant must propose a corresponding licensing term”. The previously announced minimum term is 10-years, but applicants are seeking longer.
This was in response to a query regarding construction and large-scale investment in a gaming facility, and its feasibility if a long license term isn’t provided. In addition, it clarified that each licensee may have a different license term, and the length of term will be finalized with the award of each license. Furthermore, the Commission has outlined that it “will consider the proposed licensing term in relation to the total financial and economic value of the Applicant’s proposal in relation to other Applicants’ proposals”.
Tax could follow New York sports betting
Other snippets that are of interest include that the applicants will not be informed of the tax rate until a license is awarded, but will know before the deposit is paid. Applicants are also being asked to propose how they believe their facility should be taxed in proposals. This is similar to how New York approached NY online sports betting, and it arrived at a 51% tax rate with limited operators.
With regards to adjustments to playing areas and number of machines, the Commission has revealed that the facility licensee will not have the flexibility to unilaterally decrease its table and slot count. It adds that it will allow ‘licensees to adjust their minimum requirements based on operating expenses’.
Despite answering 613 questions, the industry still feels as if it has more questions than answers. The regulator’s kept tight lipped on a lot of the nitty gritty details, but covered broad areas which may impact an overall application. The response to the second batch of questions, whenever that may be, will provide a better picture.