New York facing huge cash shortfall eyes sports betting, marijuana as new revenue streams

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ALBANY, N.Y. (WSYR-TV) — When people lose their jobs, they don’t pay as much income tax. And when people lose their jobs because restaurants, bars, retail stores, movie theaters, concerts, and other businesses shut down the state collects a lot less in sales tax.

And when the state has to fight a pandemic it spends money it hasn’t budgeted.

Add it all up and New York is facing a shortfall of $15 billion dollars.

How does New York Governor Andrew Cuomo plan to handle that shortfall? We will know more when he delivers his State of the State speech on January 11 where he outlines his vision and legislative agenda for the fiscal year that begins April 1.

Governor Cuomo has now gotten behind the idea of allowing mobile sports wagering. A recent study by the gaming industry found that about 20% of the bets made in New Jersey’s mobile sports wagering system comes from New York residents.

Cuomo, not only wants gamblers to keep their bets in New York, he wants a bigger cut.

Under the system used in New Jersey, only about $45 million dollars in revenue is collected during a twelve-month period. New York is looking at a system where it contracts with mobile sports books through already licensed casinos.

Robert Mujica, the state’s Director of the Budget says, “So, the way the Governor’s proposing it and we’ll advance it is so that the state can get up to $500 million a year instead of $50 million, and that money would then go to the state budget. Otherwise, for the betters it’s seamless and it’s exactly the same. The only difference is the state gets the money versus others.”

For the third time, Cuomo is pushing for legalizing recreational marijuana. That could, according to the budget director, generate another $300 million annually for the state. However, Mujica said it will take longer to see that annual revenue because of the time it will take to set up the system to legally sell marijuana.

Even with these two additional revenue streams, the state has a big budget gap to close.

Cuomo, along with county leaders from around the state called repeatedly on the Trump administration and Congress to include cash for financially strapped states and counties in any stimulus plans, but money for state and local governments was not included in the recent stimulus package. He’s hopeful the incoming Biden administration will be more receptive.

What other ways the Cuomo administration plans to make up the shortfall? We probably will learn more when the governor delivers his State of the State address virtually on Monday. will carry it live.

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