Queens Democrats are urging Governor Kathy Hochul to intervene in a proposal that would impose a 72% tax on slot revenues from New York City's first full casino. Local lawmakers sent a letter on August 25 to Brian O'Dwyer, chairman of the New York State Gaming Commission, expressing their concerns regarding the tax rate on Resorts World New York City. State Senator Joe Addabbo, chairman of the Committee on Racing, Gaming and Wagering, stated that the 72% tax rate is excessively high and called for the governor's office to resolve the issue.
Resorts World, which opened as a slots parlor in 2011, received a state license this year to offer live table games. The casino proposed a 56% tax rate while seeking a full license, which includes subsidies for the horse racing industry. However, the Gaming Commission, which includes five appointees from Hochul, argued that the 56% rate does not account for additional obligations to support the horse racing industry, resulting in a total effective tax rate of 72%. This could mean an additional $150 million annually over a 15-year contract.
In comparison, casinos in New Jersey pay a 9.25% tax rate, while Michigan and Ohio have rates of 19% and 33%, respectively. The lawmakers emphasized the need for immediate resolution, citing potential impacts on private investment, jobs, and local businesses. They stated that Resorts World should adhere to the 56% tax rate it proposed, while also supporting the racing industry as required by state law.
The letter was signed by ten lawmakers, including Rep. Gregory Meeks, who is also the chairman of the Queens Democratic Party. They expressed concerns that the tax dispute could affect Resorts World's planned $4 billion expansion, which is expected to create substantial union construction jobs and opportunities for local contractors.
The Gaming Commission clarified that the 56% tax rate was established when the casino license was awarded and that the tax receipts are designated for public education and the Metropolitan Transportation Authority. The commission stated that the funding for racing is mandated by a separate law and is not classified as a tax. A spokesperson for Governor Hochul reiterated that tax rates do not include racing support payments, emphasizing the state's priorities in generating tax revenue and supporting the racing industry. Resorts World has indicated that they are engaged in constructive discussions with the state.