Situated in New York, Nassau is among the most populous counties in the state. Being considered to be a central county within the New York metropolitan area, its economy is relatively stable. According to recent research, the unemployment rate in Nassau is lower than the US average rate. In addition to that, the county has witnessed a job market increase over the last year and the average income of a Nassau County resident is 1.5x higher compared to the US average rate.
Gambling is a popular pastime among Nassau County residents. As we already mentioned above, the county is part of the US state of New York, meaning that its legal framework for gambling and betting is defined by the state. New York has one of the most profitable gambling industries, with lottery sales amounting to $9 billion year-on-year. Unfortunately, the New York Constitution prohibits most forms of gambling.
In 2013, New York residents voted for a casino expansion that approved up to 7 casinos to be established in the state. Currently, New Yorkers are allowed to legally gamble only at land-based casinos. Interestingly enough, the state also allows a certain range of gambling activities, which we will discuss later in this article.
It is estimated that the state’s lottery sales are worth approximately $9 billion year-on-year. One of the most profitable slots-only casinos is Resorts World on the Aqueduct Racetrack property in Queens. In 2016, it was announced that under a state legislative deal, Nassau County will transfer its authority to install 1,000 video slot machines to Aqueduct Racetrack in Queens.
Under this agreement, Genting New York LLC, a company that operates Resorts World Casino, will make monthly payments to Nassau Regional Off-Track Betting Corp. Only 2 years later, it was revealed that the county receives just a small share of what it should get in reality.
Nassau and Online Gambling
Online gambling is illegal throughout the state. Historically, the state is known for its severe gambling laws. Luckily, in the last few years, the authorities started to change their approach slowly and the future for the gambling industry has started to look brighter.
Most of the online casinos that accept players from New York are located offshore, meaning that casino enthusiasts should not worry about playing at a web-based casino. What is more, there are various casinos that allow New Yorkers to play for real cash, meaning that players from Nassau can play their favorite games, regardless of their preferences.
We hope that New York will soon move to regulate the online gambling industry as New Jersey, which already has an online casino network, started to draw the attention of a huge number of players from New York. This, on the other hand, means that the state of New York is losing money over the border.
Interestingly enough, New York made the headlines in 2011 when a member of the US Attorney’s Office for the Southern District of New York filed criminal accusations against the 3 largest online poker rooms targeting players from the US. As a result, Full Tilt Poker and Absolute Poker needed to stop offering their services to US players. This action filled the US Treasury with the staggering sum of $547 million in fines. The action was called Black Friday.
Licensing Procedure
Land-based gambling facilities that can operate within the borders of the state of New York are required to have a license. To apply for a license, applicants must file a form that includes the following details:
- Contact information
- Trade names of the applicant
- Principal business address
- Date and formation of the business
- A thorough description of the business
- Details on the compensation and stock structure
- Background information on shareholders
- Information about the applicant’s other gambling-related activities (if any)
- Copies of financial documents
Individuals who apply for a gaming facility license should be informed that the application fee is $1 million and there is an annual fee of up to $75 million depending on the location. Once issued, the license is valid for 10 years. What is more, casinos need to pay 10% taxes on all gross gaming revenues generated from activities other than slots. The gross revenue from slots is taxed at a rate between 37% and 45%.
Since the provision of online gambling services is prohibited throughout the state, no regulator issues remote gambling licenses to operators. However, operators that offer virtual sports betting services need to register with the Gaming Commission and receive approval for conducting contests. Under the New York Racing, Pari-Mutuel Wagering and Breeding Law, section 1403 and section 1404, applicants need to have their background fully checked and must introduce measures to prevent minors from participating in gambling activities.
As for now, virtual sports betting businesses operate under a temporary license. It is obtained only if the applicants have operated in the state of New York before 10 November 2015 and file a form that contains the following information:
- Contact information
- Information regarding the operator’s daily operations
- The operator’s responsible gambling strategy
- Information regarding the prize pools
The temporary interactive sports betting license is valid for 3 years and there is no cost. Once it expires, operators need to renew it to continue providing their services. In September 2020, it was announced that online sports betting legalization could net up to $900 million in annual revenue, and $108 million in tax revenue for the state of New York.
The passage of the NY State Senate Bill 17D in 2020 authorized each of the 7 retail casinos throughout the state to operate a mobile sportsbook. Under it, operators will need to pay a 12% tax on income from sports betting and a license fee of $12 million. According to industry insiders, the state’s authorities should consider allowing 2 skins per operator that will further boost the annual revenue. Currently, the bill allows for a single skin to be given to licensed operators.
New York Gambling Regulatory Authorities
The gambling activities conducted throughout New York are supervised by the New York State Gaming Commission. The regulatory body was established in 2013 and it combines the New York State Racing and Wagering Board and the New York Lottery. The watchdog is responsible for issuing regulations that govern horse racing, casino gaming, state and charitable lotteries, and video lottery terminals.
The Commission can issue licenses and address civil enforcement matters, but criminal violations of law are not within its scope of work. The regulator needs to report infringements to other law enforcement agencies. On 20 October 2020, the Commission unanimously voted for the permanent license revocation of former racetrack groom Ramzan Antooa of Elmont who was arrested on criminal charges.
The New York Gaming Facility Location Board is the authority responsible for selecting the locations for casinos.
Taxes on Gambling Winnings
If you reside in Nassau and you win the lottery, you need to know that your prize is taxable on both state and federal levels. New York’s state lottery agency will automatically deduct taxes from larger winnings. Lottery winners from Nassau can claim their prizes up to $600 simply by bringing their tickets to the lottery retailer. Prizes exceeding this sum can be claimed if the winner files a certain form with the state.
Under federal law, the state of New York needs to report all lottery winnings above $600 to the International Revenue Service and the state will automatically take its share from prizes that amount to $5,000 or more. Winners residing in Nassau have to report lottery prizes as an income regardless of the size of the prize.
Prizes of $5,000 or more are taxed at a 24% rate. The New York state also imposes a city tax, which rate depends on the winner’s city of residence. Lottery winners from New York can claim their prizes in lump sums or installments. In any case, taxes are withheld from the winnings once they are paid out.
Closing Thoughts
Nassau County’s gambling industry falls under the New York legal framework. Hence, Nassau players are restricted from enjoying a huge number of gambling activities. Over the years, the gambling laws in New York have limited this pastime only to casinos located on Indian reservations. The other lawful gambling activity is betting on horse races.
As for now, it seems that the authorities are poised to make changes in the state’s legal framework concerning gambling and attract a fresh source of revenue for the state and the federal government. The authorities’ latest move was to enact the NY State Senate Bill 17D and allow the 7 casinos throughout the state to conduct virtual sports betting activities.
With regard to online gambling, running a virtual casino within the borders of the state is illegal. However, the law does not explicitly state that New Yorkers are not allowed to place bets online. Consequently, a huge number of offshore virtual casinos accept players from New York.
Following that stream of thoughts, Nassau casino fans will not experience a shortage of gambling options. However, this does not change the fact that the authorities in New York should consider amending the law in order to make the most out of this gambling trend for the state.