Former New York Gov. David Paterson Urges State to License Downstate Casinos

The less than one-term governor believes that approving the new casinos would provide the cash-strapped state with much-needed revenue. Only during the COVID-19 pandemic did New York’s budget deficit worsen. This has led to several failing businesses and industries and many New Yorkers leaving the state.

Also worthy to note is that in 2013, New York voters approved four commercial upstate casinos and three downstate casinos. But a ban on downstate casinos was imposed by lawmakers until 2023. The moratorium was intended to allow the opening of upstate casinos without downstate competition.

Now, Paterson urges the state to lift this moratorium and allow businesses like Sands to enter a bidding war for the coveted gaming rights. The former governor believes that the upfront licenses would provide the state with immediate payments of $1.5 billion and additional ongoing annual revenues of $900 million.

Cuts Spending Not the Way to Go

Instead of further taxing people and businesses, Paterson says more casinos is one reasonable solution. As he learned, in a time of budget distress, there are two options, cut spending or raise revenue, and right now, cut spending is not an option as New Yorkers battle to recover from COVID-19.

Also, Patterson stated that the NY government could keep them to the highest minority and women-owned business enterprise levels as businesses apply for a casino license in New York. During the pandemic, minority industries were decimated, and now they can build back stronger, fairly, and sustainably.

He went on to say that only if the state provides an open and transparent procedure for all three remaining licenses to obtain the full benefits and to bring New Yorkers back to work would these once-in-a-lifetime outcomes be a reality.

The NY government can decide to be smart and find new revenue streams, like awarding the three remaining downstate casino licenses, resulting in an immediate influx of $1.5 billion and new union jobs. New York voters already approved the three licenses, and lawmakers need to expedite the process to reap the benefits.

Does the Controversial Patterson Deserve any Attention?

After the state economy suffered in the aftermath of the 9/11 terrorist attacks, New York legalized video gaming terminals (VGTs) at the eight-horse racetracks of the state in 2001. In the years following, the racetracks turned into ‘racinos.’ But in Queens, known as the most lucrative, the Aqueduct Racetrack gaming license set off a bidding war that led to suspected peddling, scandals, and years of delays.

Paterson awarded the Aqueduct casino license to a corporation called Aqueduct Race Track Entertainment Group in January of 2010 (AEG). Both state and federal authorities investigated the bidding process after reports arose that Paterson selected AEG because of his strong relationship with Jay-Z, who owned a seven percent interest in AEG.

Paterson served as the governor of New York for less than two years. Amid the governor’s sex scandal in March of 2008, he succeeded Eliot Spitzer. During the 2010 gubernatorial election, Cuomo won support among the Empire State Democrats, causing Paterson to withdraw his candidacy. Paterson has used his political connections to work as a lobbyist ever since leaving office. He’s currently a senior advisor to Robert Goldstein, Las Vegas Sands’ president and chief operating officer.


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