The number of entities and individuals hoping to build one of the next great New York casinos continues to grow. Toward that end, the interested parties are trying to build community coalitions. Those involve local politicians.
Local officials and state politicians are among the decision makers who will choose who gets the opportunity to build one of the world’s future most profitable casinos. Politico has revealed that lobbying firms behind 10 New York City metro area casino proposals have invested millions over the past 14 months.
One of the hardest-fought public campaigns in New York
According to Politico, lobbying firms behind 10 New York City casino proposals have recently spent at least $7.2 million. They have contacted decision-makers on behalf of US casino operators like Bally’s and Caesars and their real estate partners. Some have even worked for competing clients.
Lobbying companies have spent unreported amounts for consulting, political strategy and public relations, Politico says. The lobbyists were able to do so as these types of contracts are not required to be public, like lobbying deals are.
In an interview, Manhattan Borough President Mark Levine said: “It seems like every lobbyist in town is eventually going to have a casino client. Even one of these bids will probably be amongst the hardest-fought public campaigns, and to have ten happening at the same time in New York City is just totally unprecedented. I don’t think New York City has ever seen anything like what we’re about to witness as the bids heat up.”
According to the real estate services firm CBRE, a casino in New York City could generate $2 billion in revenue annually. In terms of operating profit, the gaming destination could generate $600 million.
Who decides on the fiercely competitive process?
The state’s Gaming Facility Location Board selects the winners first. Their suggestions then go on to the New York Gaming Commission. Any applicant would have to win over the local Community Advisory Committee, which includes the following members:
- Borough president
- Local state senator
- Local city council member
Applicants must convince at least four of the six members for their project to proceed.
Competition revolves around three downstate licenses
New York opened the bidding process in January to operate three downstate licenses. Two existing so-called “racinos” in Queens and Yonkers are considered favorites for two licenses to increase their limited services. At least another eight will compete for the (most likely) one remaining license.
Each bidder must pay the state a mandatory entry fee at least of $500 million to enter the state’s gaming market. The selection process could last a few years; for now, the lobbyists are the only ones cashing in.
Genting and MGM Resorts well-positioned to receive NY casino license
According to Politico’s report, Genting Group has a great chance of getting a license. It has invested $2.7 million in lobbying firms to expand its Resorts World. It is the gaming facility that Genting has been operating at the Aqueduct Race Track in Queens since last January.
Competitors also consider MGM Resorts International and its gaming site in Yonkers likely to win the license. That leaves a third license up for grabs for one of the other bidders.
Caesars, Wynn Resorts and Mohegan have also bid to build a New York casino. Bally’s is eyeing a golf course located in the Bronx. Meanwhile, Mets owner Steve Cohen is looking to create a Queens casino on a current parking lot location. Seven firms, including Moonshot, are lobbying for Cohen, who has allegedly spent over $680,000 trying to win the city’s gambling industry officials.
No corruption has been reported among New York casino proposals so far
John Kaehny, executive director at the watchdog group Reinvent Albany, told Politico:
“Massive amounts of money are pouring into the political system to try to influence these siting decisions. It’s an absolute petri dish for pay-to-play corruption and influence peddling.”
The lobbying companies have approached almost every political and governmental member that would be involved in reviewing the proposals. Some government groups worry the mix of big money, fierce competition, and political signoff could lead to corruption. Likewise, the legalization of casinos in other states has often indicated pay-to-play scandals.
But no one has suggested corruption has taken place as part of the ongoing process in New York. At least for now.