Sports betting is not yet legal in New York, but two well-known operators are nonetheless signing a sports betting partnership agreement.

The tribal gaming operator Oneida Indian Nation is entering into a deal with Caesars Entertainment Corp. This is set to be an innovative partnership that will allow the two parties to work together when it comes to marketing and sports betting.

It will allow the three casinos in upstate New York to now offer sports betting. These casinos are the Point Place Casino, Yellow Brick Road Casino and the Turning Stone Resort Casino.

Sports betting in New York

Following the ending of the federal ban on sports betting in May 2018, New York was one of the first states to start considering legalization. There were lengthy debates on the issue and many versions of sports betting bills.

However, the legislative session for 2018 came to a close in the state before legislators could reach final agreement on the issue.

There are now concerns that the changes in the political scene in the state following the November midterm elections could lead to further delays in passing such a bill.

There is no doubt that New Yorkers would be in favour of legal sports betting. Many of them cross the state border into neighbouring New Jersey every week in order to place sports bets. New Jersey has been enjoying significant results since it opened its first sportsbooks shortly after the federal ban was overturned.

Stumbling blocks

One of the main issues that were up for discussion in New York was that of integrity fees. These are fees that some of the major sports leagues, particularly the MLB and NBA, are seeking to ensure that the integrity of their sports is maintained.

The integrity fee would be a slice of every sports bet made on an event under the umbrella of the leagues. It would significantly curtail the margins of the operators, who already have to pay significant taxes on their revenues.

The leagues initially were looking for 2% of every sports bet, but the legislature was looking at an integrity fee of 0.2%. No state in the country has yet permitted integrity fees to be included as part of their final sports betting bill.

Even the leagues themselves are moving away from pursuing this model and instead looking to license their official live game data to operators.

Political changes

There were a lot of changes in the state Senate following the November elections. Republicans are no longer in control of the Senate, with the Democrats taking over.

Furthermore, the long-running chair of the Senate Committee on Racing, Gaming and Wagering, Senator John Bonacic, has retired. The new committee chair, Senator Joseph Addabbo, was a co-sponsor of the previous sports betting proposal, so he is likely to support legalization efforts.

However, the main issue is that of the new chair of the Finance Committee in the Senate. Senator Liz Krueger has a lot of control over the future of sports betting in New York state and she is anti-gambling.

For a new bill to get approval, it needs to go through her committee. She was one of the two people in opposition of the legalization proposal to the committee in 2018.

She could even stop such a bill being up for discussion by not having it included on the agenda of the committee. This is a significant hurdle for the passing of such a bill. There will also need to be a public vote on the issue in order to expand existing gambling laws.

Is there a loophole?

While sports betting is not legal in New York, there is a provision that allows the existing upstate casinos to offer sports betting without any changes in the laws.

The provision does not cover mobile sports betting or racetracks. It also prevents any bets being made on college games that involve teams from New York or take place in the state.

Some parties have been pushing to have this existing law changed and expanded to allow others to operate in the space. The New York State Gaming Commission has “long been working on regulations that would effectuate sports gambling under the existing statutory language.”

New sports betting offering

The three upstate New York casinos can now open sportsbooks as part of the existing provision in the law. They will be launching the new partnership with the opening of the “Lounge with Caesars Sports” at the Turning Stone casino.

First, the National Indian Gaming Association will need to give the venture its approval, as will the New York State Gaming Commission. Both parties seem to be happy with this new partnership.

The commercial casinos in the state are also looking to cement their own sports betting partnerships in advance of potential legalization. The Oneida tribe is leading the charge for tribal sports betting in the state.

Shortly after the ending of the federal ban, the tribe made references to its 1993 gaming compact. This says the tribe is able to “adopt any gaming specification that is permitted in New York, without any further approvals by the state.”

The other gaming tribes in the state are the Mohawk and Seneca nations. They do not have any public plans to start offering sports betting.