The Las Vegas-style resort casinos coming to New York are supposed to reverse the fortunes of a struggling upstate economy, but there are doubts about the promised economic benefits, and whether upstate casinos can even survive in an increasingly crowded market. NY1's Bobby Cuza has more in part three of his series, "Rolling the Dice."
Governor Andrew Cuomo has long promoted casinos as a sure bet for upstate, helping recapture dollars that gamblers now spend out of state.
"They now go to New Jersey. They go to Connecticut. Why don't we bring them to upstate New York?" Cuomo said.
The administration projects four upstate casinos will generate $1 billion worth of construction and create nearly 10,000 jobs, but the amount of new tax revenue is relatively modest: an estimated $430 million a year. Compare that to the $3.2 billion already generated by existing gaming, including the lottery and racinos, for state education. The Resorts World racino at Aqueduct racetrack alone generated $349 million last year.
Some warn that casinos could simply displace existing economic activity.
"Any notion that in New York, there's going to be a significant economic benefit to the state, if people have that conclusion, we would suggest caution in that regard," said State Comptroller Thomas DiNapoli.
Critics also point to the social costs, like problem gambling, an issue the state will dedicate nearly $5 million a year to address. But perhaps a larger concern is the regional competition that's led several Atlantic City casinos to close and ratings agencies to issue dire forecasts.
"Casinos that are coming online aren't necessarily growing the market, but they're really eating into their competitors' business," said Michael Paladino of Fitch Ratings.
Indeed, feeling threatened by New York's plans, New Jersey officials are now considering allowing casinos in north Jersey, just outside the city. Proposals have already been floated for casinos at the Meadowlands and just across the harbor from Lower Manhattan in Jersey City.
But Genting, the owner of Resorts World, believes its proposed upstate casino can tap into new markets.
"We think we can actually draw international tourism there, so the market is much different," said Christian Goode of Genting Americas. "The facility here is convenience gaming. It's Queens, Brooklyn, Long Island."
Apparently, other developers are equally optimistic. New York's initial round of applications yielded 22 casino bids, each with a $1 million application fee.