New York State Casino License Applications Coming In at Top Dollar
Posted on: April 3, 2014, 05:30h.
Last updated on: September 14, 2014, 12:59h.
If you want to run a casino in New York State, you’d better have a healthy bank account accessible. Okay, so you probably already knew that: it’s not like building and operating a casino can be done with a few thousand dollars, after all. But the applications released by the New York State Gaming Commission on Monday may chase away even some of the wealthy operators who have expressed interest in earning a license there.
Pay to Even Try to Play
According to the application, each interested party will have to pay $1 million just to apply for one of the four licenses currently up for grabs to operate casinos in upstate New York. That fee is nonrefundable – meaning any applicant will have to feel comfortable losing that amount should they not be picked.
And that’s just the start of the costly process. Once chosen, operators will have to pay up to $70 million to purchase the license – not to mention spending hundreds of millions building the casinos.
That’s not going to stop operators from trying, of course. Well over a dozen different firms have already expressed interest in building casinos in the state, and while some will inevitably shy away, that suggests there will be a great deal of competition when the June 30 application deadline rolls around.
Catskills Casino is the Biggest Prize
Most of that competition is likely to take place in the Catskills. Formerly a popular resort destination, it’s the closest license to New York City, and the area has the infrastructure already in place to support plenty of visitors who may want to gamble and enjoy the mountains there, especially in the winter.
“You’ve got to locate where there’s a real market,” said former New York Sate Lottery director Gordon Medenica. “This field-of-dreams strategy is out of date.”
Yet some operators apparently still believe that if they build it, the gamblers will come. Several have expressed interest in a region in western New York near the Canadian border.
Variety of Criteria to be Considered
With such a competitive bidding process expected, state regulators may be left with a tough decision when it comes to choosing who receives each regional license. Of the criteria being used to select winners, the amount of economic development a casino would generate for the local community will be given the most weight.
But as in neighboring Massachusetts, prospective operators will also have to demonstrate that they have the support of the community. The local impact of each casino will also be considered, as will each developer’s employment plan.
Costs to Vary By Location
Just how much it will cost to purchase a license and build a casino will depend heavily on where each property is built. The price of licenses will range from a minimum of $20 million for some locations in western New York, to a minimum of $70 million for a casino in Orange or Dutchess County. Interestingly, even locations within each region vary in this regard: for instance, a license further north in the Catskills might be as cheap as $35 million, or half the price of the Orange or Dutchess locations.
In addition, the gaming board noted that they will also be setting minimum required investment amounts for each of the three regions currently being bid upon. However, those amounts won’t be determined until after a conference for bidders is held in April.
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