New Jersey regulators announced on Friday the October state gaming industry revenue figures, including $803.1 million wagered on sports at Atlantic City’s nine casinos, the state’s three racetracks, and their mobile sports betting partners. It was the second consecutive month in which New Jersey set a new record for sports betting handle in any single state.
That enormous handle figure led to a total of $58.6 million in sports betting revenue for New Jersey operators in October.
On Friday, New York regulators also revealed October figures for that state’s four commercial casinos (New York also has a number of tribal casinos, while New Jersey does not). But there was no press release, no national attention — and, per the custom of the New York State Gaming Commission, no figures on handle.
The upstate casinos — none of them within 90 miles of Times Square in Manhattan, by the way — generated a paltry $2.6 million from sports betting in October.
Jersey’s dominance — by the numbers
For the year 2020, New Jersey’s casinos, racetracks, and their online sports betting app partners have raked in $281.6 million while their New York counterparts have totaled a mere $6.2 million.
New Jerseyans and visitors have legally bet a whopping $4 billion on sporting events this year, with a “hold” — the percentage of money retained by the house — of 6.3%.
With New Jersey collecting almost 50 times the amount of sports betting revenue of New York so far in 2020, that allows for a back-of-the-envelope estimate for the amount bet legally in New York this year of around $70 million.
What’s in it for the taxpayers? In New Jersey, $35.5 million in sports betting taxes for the first 10 months of this year.
New York regulators don’t break down the taxes raised specifically from sports betting revenue. But given the state’s 10% tax on such revenue, it’s clear that not even $1 million in tax dollars has gone into the state’s budget thanks to sports betting.
Online betting wins the day for NJ
The overwhelming majority of the discrepancy is not from only running sportsbooks at relatively remote sites in New York. It’s the absence of legal mobile sports betting.
A remarkable 91% of all sports wagers in New Jersey in 2020 have been placed online. And while COVID-19 has limited capacity for Atlantic City casinos to a maximum of 25%, that percentage of online betting has only risen about a half-dozen points since a COVID-free environment of a year ago.
Of course, much of New Jersey’s windfall comes from New Yorkers — particularly city residents who would rather take a car, train, bus, bicycle, or their feet a couple of miles across the Hudson River than schlep all the way to the Catskills and beyond to make in-person bets.
A research report released in February estimated that 40% of the betting handle at the FanDuel Sportsbook at the Meadowlands Racetrack came from the pockets of New Yorkers. A total of $836 million was estimated to have been wagered by New Yorkers in New Jersey in 2019 at brick-and-mortar sites as well as online. The result was $6.3 million in foregone tax revenue for New York.
Gross gaming revenue for casinos in New York on all forms of gambling in 2020 is $195.8 million — which almost sounds like a lot, until it is compared to New Jersey’s $2.3 billion.
Another edge for NJ in ‘border wars’
There’s an even larger discrepancy between the states when it comes to online casino gaming.
For the first 10 months of 2020, New Jersey online casinos have raked in an impressive $779.1 million — or 2½ times the state’s sports betting revenue from all sources.
New York casinos, of course, have collected zero in online casino revenue because the state has not legalized an option that launched in New Jersey (and Delaware) in 2013.
In spite of game efforts by New York state Sen. Joseph Addabbo of Queens and Assemblyman Gary Pretlow of Yonkers, Gov. Andrew Cuomo has turned a deaf ear to an online expansion of legal gambling.
Will a cupboard-is-bare budget due to a pandemic lead Cuomo to change his mind? There’s no evidence of it so far, but New Jersey’s advantage across the board has produced a total of $217.4 million in taxes so far this year.
At some point, New York City-area casinos — currently delayed until at least 2023 — as well as mobile sports betting and online casino gaming could become reality. Until then, the state is leaving hundreds of millions of tax dollars on the table.
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