Hochul Blocks Legislation to Speed Up Casino Bidding Process

Governor Kathy Hochul has vetoed a legislative proposal aimed at accelerating the timeline for casino bid submissions in New York City and surrounding areas. The bill, ed by lawmakers in June, sought to move the deadline for bidders to submit their proposals to August 2023, even if zoning and other local approvals were still pending.

In her veto message, Hochul justified her decision by emphasizing the need for fairness in the bidding process. “Changing the timeline … would likely have the impact of helping certain bidders and hurting others,” she wrote. “I cannot a bill that aims to change the rules in the middle of the process.”

Pocket Veto and Industry Implications

Hochul’s inaction on the bill as the proposed deadline ed effectively constituted a pocket veto. This decision aligns with the state’s original framework, which anticipates granting up to three downstate casino licenses by the end of 2025.

Industry insiders suggest that maintaining the longer timeline benefits certain bidders who face political hurdles or unresolved land-use and zoning issues. Among those potentially affected by an accelerated deadline are Mets owner Steve Cohen, who has proposed an $8 billion casino-entertainment complex near Citi Field in Queens, and Wynn Resorts’ $12 billion Hudson Yards proposal.

Hochul highlighted the importance of sticking to the process established in the 2022 state budget, which requires applicants to collaborate with local governments to ensure their projects comply with municipal zoning laws.

“Potential applicants have been continuously working toward ensuring that their projects are compliant,” she noted, defending the current timeline as necessary for fairness and thorough planning.

Legislative Pushback

State Senator Joe Addabbo and Assemblyman Gary Pretlow, co-sponsors of the vetoed bill, expressed dissatisfaction with Hochul’s decision. Addabbo, who chairs the Senate Committee on Racing, Gaming, and Wagering, criticized the governor for accusing lawmakers of disrupting the process while making mid-process changes herself in other areas, such as congestion pricing.

Addabbo argued that an expedited timeline would have helped identify and eliminate bidders struggling with significant legal or zoning challenges. “If you can’t figure out the land-use issues in two years, maybe a casino shouldn’t be there,” he remarked.

The financial implications of the casino licenses are substantial, with a minimum fee of $500 million per license expected to generate significant revenue for the Metropolitan Transportation Authority. Addabbo believes this figure could rise to $750 million per license, potentially totaling $2.25 billion.

Despite the high stakes, constructing new casinos could take up to three years after licenses are issued. However, existing facilities such as Resorts World at Aqueduct and MGM Empire City in Yonkers could quickly transition to full-scale casinos, potentially adding table games within months of obtaining licenses.

Under the current process, casino bids must be submitted by June 27, 2025. Each proposal will undergo review by Community Advisory Committees composed of elected officials from affected areas, who will vote on approval or rejection. Following this, the state’s Gaming Facility Location Board will make recommendations to the state Gaming Commission, which is tasked with granting final approval by the end of 2025.

Source:

”Governor vetoes bill that would force NYC casino bidders to move fast or lose their chance”, cdcgaming.com, November 25, 2024.