New York Is Ready For Online Sports Betting, But First The State Gaming Commission Needs An Overhaul

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This week, Governor Andrew Cuomo of New York expressed that he is finally ready to move the state toward legalizing and regulating online sports betting. Sports betting operators are excited. Bettors are thrilled. But the New York State Gaming Commission may need a complete overhaul before the new licensing process takes effect.

While there are good reasons to be excited about online sports gambling, there are also strong reasons to be skeptical about the New York State Gaming Commission’s ability to effectively regulate sports betting. Most notably, back in August 2016, Governor Cuomo signed into law the Interactive Fantasy Sports Bill, which called for the New York State Gaming Commission to implement a mandatory registration system for all potential fantasy sports operators. Instead of doing what the bill required, the gaming commission simply handed temporary permits to pre-existing competitors (a short-term solution allowed by the bill) and failed to ever implement full registrations.

By failing to fulfill the legislative intent of creating a clear and transparent market for daily fantasy sports, the New York State Gaming Commission made a mess of the DFS competitive landscape in a number of ways. Among them, it allowed companies such as FanDuel and DraftKings to enjoy an indefinite shared monopoly over the market while freezing out all those companies that did not attempt to enter the New York market before they received statutory clearance.

Defenders of the New York State Gaming Commission’s failure to create a means of licensing new interactive fantasy sports companies have advanced a wide range of theories for why the agency still has not made licensing applications available—not even four and a half years later. Some of the New York State Gaming Commission’s defenders claim the failure to make licensing applications available is based on ongoing litigation that seeks to invalidate the Interactive Fantasy Sports Bill in its entirety. However, despite two court rulings on the matter, the New York State Gaming Commission continues to appeal these decisions, and thus the Interactive Fantasy Sports Bill, as a matter of law, remains in full effect.

Given that the ongoing litigation fails to adequately explain the New York State Gaming Commission’s (in)actions, one can reasonably presume one of two things: Either the agency has deliberately chosen to keep new market competition out of the state despite the clear statutory intent of the Interactive Fantasy Sports Bill, or the New York State Gaming Commission simply does not have the human resources needed to move forward with regulating daily fantasy sports.

Whichever of these explanations is the case, neither explanation bodes well for the potential of the New York State Gaming Commission to fairly and efficiently license and regulate new operators in the potentially much larger world of online sports betting. This is a concern that Governor Cuomo may need to carefully address before he gets the New York State Gaming Commission too involved in the task of licensing new online sports gambling operators.

https://www.forbes.com/sites/marcedelman/2021/01/08/new-york-is-ready-for-online-sports-betting-but-first-the-state-gaming-commission-needs-an-overhaul/?sh=6ea509d52dd4