Resorts World NYC Clashes With Regulators Over $150 Million Racing Payments

• Resorts World disputes $150 million annual horse-racing payment obligation
• Casino says racing subsidies are already included in taxes
• Legislative fix faces deadline as session ends June 10

The ink is barely dry on Resorts World New York City’s full casino license, but the company is already fighting Albany. At stake are hundreds of millions of dollars in payments to the state’s horse-racing industry, according to New York Focus.

The city’s first full-fledged casino opened in April in Ozone Park, Queens, complete with table games and slots, as an expansion of the existing video lottery terminal (VLT) -only racino. But the casino is unhappy about the New York Gaming Commission’s demands for payments of at least $150 million per year to help fund racing.

$150 Million Question

When New York allowed VLT gambling at racetracks in 2001, lawmakers required operators to send part of their revenue to support horse racing, which was struggling financially.

When New York later authorized full-scale downstate casinos, lawmakers kept those racing-support payments in place so horse racing wouldn’t suddenly lose funding.

To compound the issue, the payments were structured with the expectation that three downstate casinos would share the burden. But Resorts World is currently the only licensed operator open for business – and the others are years away.

During the competition for licenses, Resorts World offered to pay a slot-machine tax rate of 56%, much higher than the rates offered by the other winning casinos. The company says the state previously promised bidders they wouldn’t be forced to pay a different tax rate than the one they proposed.

Legislative Fix?

In a statement, Resorts World pointed to the billions of dollars it has already contributed to education, horse racing, and public transit, and said it intends to honor the financial commitments it made when it won its casino license.

Resorts World had hoped to get the proposal tagged onto the state budget, according to New York Focus, but that ship has now sailed. With the clock ticking down on the legislative session, which ends June 10, its hopes now lie in persuading lawmakers to pass the measure as a zero-hour standalone bill.