Resorts World New York City is pressing Governor Kathy Hochul’s administration to let mandatory racing-support payments count toward its 56% slot-tax offer, instead of being added on top. If the state refuses, the Queens casino says its effective slot tax would rise to 72%, leaving it with a bill that could be hundreds of millions of dollars higher.
New York Focus reported that the dispute centres on whether Resorts World must pay more than $150 million a year to the state’s horseracing industry in addition to its regular taxes. The company argues that its bid always contemplated a 56% rate inclusive of racing support, and it has suggested the higher burden could put its expansion plan at risk.
As we reported in August, Queens Democrats had already pressed Hochul over the same 72% calculation. On Aug. 25, 10 lawmakers wrote to Gaming Commission chairman Brian O’Dwyer asking the regulator to clarify that the 56% slot rate includes racing support, and warning that uncertainty could threaten billions of dollars in private investment and thousands of jobs.
A June 5 legislative fix temporarily allowed the Gaming Commission to route casino tax revenue to the New York Racing Association for one year, but it did not settle the central question of whether racing support is part of Resorts World’s casino tax or an extra charge. After that vote, Resorts World said it was grateful for the changes and looked forward to working with the state, but the underlying dispute remained.
The Hochul administration appears unmoved. Gordon Tepper, the governor’s spokesman, said: “By law, tax rates do not, and have never, included racing support payments.” He also said the state’s priorities were tax revenue for education and mass transit, continued support for racing, and delivery of the investment and jobs Resorts World promised.
State officials also said the other two winning downstate casinos, Bally’s Bronx and Metropolitan Park, will make racing-support payments separately and raised no public objections. The selection document for the casino process said the board’s recommendation that Resorts World be considered for a licence was based on the tax rates it bid, not on lower rates it now wants to apply.
That same document said the bid process was created after the state’s 2022 budget law set a new siting process, and that Resorts World proposed a 56% slot tax and 30% table tax in its supplemental materials. The disagreement matters because the casino’s financing depends heavily on borrowing and future cash flow, according to state regulators who reviewed the bid.
A state panel warned that the project’s financing plan relies heavily on future operating cash flow and future debt financing to fund a substantial portion of development costs. State Sen. Joe Addabbo said lenders were already worried, and warned that if 56% turns into 72%, “any rational person would see that as a problem, let alone a bank.”
Vicki Been, who chaired the state board that recommended Resorts World’s licence, said the company had no standing to ask for a tax rewrite. She said the board had already made it clear that Resorts World could not return and complain that other bidders had offered lower rates, because “that’s the bidding process, that’s what you bid.”
For now, well over $500 million is at stake.
