New York Governor Andrew Cuomo announced legislation to authorize mobile sports wagering — sending shares of at least two companies higher Wednesday.
Sports betting company DraftKings was up nearly 4% at $49.28. Gan, a supplier of Internet gaming software, surged 12% $22.27.
Under Cuomo’s proposal, the New York State Gaming Commission will issue a request for proposals to select and license a sports operator or platform to offer mobile sports wagering in the state. The operator must have a partnership with an existing licensed commercial casino. The Commission will require safeguards against abuses and addiction.
“At a time when New York faces a historic budget deficit due to the COVID-19 pandemic, the current online sports wagering structure incentivizes a large segment of New York residents to travel out of state to make online sports wagers or continue to patronize black markets,” Cuomo said at a press briefing. “New York has the potential to be the largest sports wagering market in the United States, and by legalizing online sports betting we aim to keep millions of dollars in revenue here at home, which will only strengthen our ability to rebuild from the COVID-19 crisis.”
The sports gambling market is evolving rapidly. In 2018, the Supreme Court in Murphy v. NCAA overturned a federal law prohibiting most states from authorizing sports wagering, which is now legal online in 14 states including bordering New Jersey and Pennsylvania. In New York, it is only legal at four upstate commercial gaming facilities and Native American gaming facilities. An industry study found that nearly 20% of New Jersey’s sports wagering revenue comes from New York residents, Cuomo said.
Cuomo also announced a proposal to legalize cannabis. A new Office of Cannabis Management would oversee a new adult-use program as well as the state’s existing medical and cannabinoid hemp programs
For the adult-use market, he said the state will offer licensing opportunities and assistance to entrepreneurs in communities of color who have been disproportionately impacted by the war on drugs.
Once fully implemented, legalization is expected to generate more than $300 million in tax revenue.