Queens Democrats have asked state regulators to stop a tax arrangement they say would force Resorts World New York City to hand over 72% of its slot revenue, escalating a fight that has already drawn in Gov. Kathy Hochul’s office and the New York State Gaming Commission.
On Aug. 25, 10 lawmakers sent a letter to Gaming Commission chairman Brian O’Dwyer. They said the casino should pay the 56% slot gaming tax rate it offered when seeking its licence, while the separate racing-industry payments should continue to be made as required under state law.
The dispute turns on a narrow but expensive question: whether Resorts World’s racing-support obligation is folded into that 56% rate or added on top of it. If it is added on top, the New York Post reported, the combined take from slot revenue would amount to 72%, or another 16%, and the extra obligation would come to about $150 million a year over a 15-year contract.
The letter said a 72% rate is “excessively high” and warned that the uncertainty could threaten “billions of dollars in private investment, thousands of jobs, local businesses, and the communities we represent.” It also said applicants should be held to the financial, employment, investment and community commitments they make to New York, but that the state should administer those commitments under the framework on which they were offered and evaluated.
State Sen. Joe Addabbo, who chairs the Senate Committee on Racing, Gaming and Wagering, said the governor’s office had to “step in and resolve this issue.” He said the Gaming Commission falls under Hochul’s auspices.
The dispute reaches beyond the tax rate itself. The lawmakers said it could hinder Resorts World’s planned $4 billion casino and entertainment expansion, along with union construction work, thousands of permanent jobs and opportunities for local and minority contractors.
State regulators have rejected the idea that the racing payments are part of the slot tax. The Gaming Commission said Resorts World would pay a 56% tax rate on slot-machine gross gaming revenue, just as it had proposed in its licence bid, and that its other statutory obligations are “separate and apart” from taxes. Hochul’s office said tax rates “do not, and have never, included racing support payments.”
The issue has been building since Resorts World opened in April as the first downstate casino. In June, Albany leaders moved to shield the racing industry while leaving the underlying dispute unresolved, and the legislature later passed a bill that preserved racing funding for a year without deciding who ultimately owes the money.
The New York Post said the 10 lawmakers wanted “immediate resolution” and that a decision was expected by Friday.
