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NYS Comptroller Calls For Attention As Problem Gambling Calls Increase

Written By Katarina Vojvodic | Updated:
New York State Comptroller Thomas P. DiNapoli

Revenue from New York online sports betting has turned out to be a better source of income for the state than anyone could expect. But there’s also a downside.

The New York comptroller’s recent report shows online sports betting revenue in the state increases, but so do problem gambling calls. New York state collected $727.4 million in taxes from online sports betting during the fiscal year 2022-2023.

The figure only continued to grow in the first quarter of the current fiscal year, according to the Recent Impact of Gaming Expansions on Revenues and Problem Gambling in New York, by State Comptroller Thomas P. DiNapoli.

Since the Empire State legalized online sports betting in January 2022, the New York State Gaming Commission noted a 26% increase in calls related to problem gambling, which the Office of Addiction Services and Supports (OASAS) received from 2021 to 2022.

More information is needed to understand gambling’s effect on individuals

With online sports betting continuing to expand, the NY Comptroller is calling attention to a surge in calls related to gambling addiction. DiNapoli said in a news release:

“Gaming has significantly expanded in the state in the last several years. With the ease and 24/7 availability of mobile betting apps, problem gambling and addiction are poised to increase. More attention should be devoted to understanding the implications of mobile sports betting, particularly on young New Yorkers.”

Since DiNapoli’s 2020 gaming report, OASAS spending on problem gambling services has increased by two-thirds. Here’s how the state fiscal years compare:

  • FY 2019-20: About $5.7 million
  • FY 2022-23: Over $9.6 million

The legislation authorizing online sports betting required 1% of the gambling revenue tax (around $1.6 million) to be set aside for problem gambling services in FY 2021-22. For each following fiscal year, problem gambling services shall receive $6 million from those revenues.

Research also indicates higher gambling problems among individuals who bet using their mobile devices.

New York has one of the highest GGR rates in the US

With a tax rate of 51% on gross gaming revenue (GGR), New York joins Rhode Island and New Hampshire in imposing the highest rate in the US.

In the fiscal year 2021-22, online sports betting generated $360.7 million for the state, far more than the initially projected $99 million.

The $727.4 million in collections in FY 2022-23 was also double the projection of $357 million.

The higher collections are mostly due to the number of licenses issued to sportsbook operators and the tax rate imposed.

Revenues in Q1 of the current fiscal year have continued to rise. However, the state Division of the Budget projects collections will level out, increasing by 6.9% over the next four fiscal years.

NY gambling continues to expand regardless of the consequences

New York will add three new commercial casinos, as the FY 2022-23 Enacted Budget authorized. The NY comptroller’s report says, “careful analysis should be done” to make sure projections of revenues and economic benefits are “reasonable and attainable.”

All applicants had to pay a $1 million application fee while qualifying bids required:

  • A minimum $500 million capital investment
  • An additional $500 million for the gambling license fee

According to DiNapoli’s recent report, Revenue Impact of Commercial Casinos on Upstate Local Governments, revenues received from the four upstate casinos fell “significantly short” of projections. The four gaming venues also failed to create over 4,700 jobs.

When all four casinos were fully active in 2019, employment in the leisure and hospitality industry increased by just under 3,800.

Another failure happened in June when a bill to establish a Problem Gambling Advisory Council (PGAC) got delayed again. It was the second delay in the past year and the fifth since 2015.

The bill’s status raised many questions and concerns about the future of responsible gambling initiatives in the state. The proposed legislation (SB6701) aimed to improve access to prevention and treatment services throughout the state.

Photo by Hans Pennink / AP Photo
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Katarina Vojvodic

Katarina Vojvodic is a lead writer for PlayUSA who lives in Toronto. Vojvodic provides coverage of the US gambling industry with a focus on US online casinos. Previously, she covered Ontario’s online gambling industry for PlayCanada.com. Vojvodic holds a master’s degree in journalism from the University of Belgrade. Outside working hours, she can be found near the water with her husband and their two kids.

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