N.Y. Bars Add Gambling Terminals After Cuomo Pushes Law Change

By Freeman Klopott on June 29, 2012

Bar patrons in New York can now win their fortunes while drowning their sorrows.

Neighborhood taverns are adding bingo-style terminals run by the state lottery under a law pushed through the Legislature this year by Governor Andrew Cuomo.

New York Lottery, the largest in the U.S. by sales, has put 92 of the terminals in bars since April, when a restriction designed to keep the machines out of taverns was lifted as part of Cuomo’s budget, said Gardner Gurney, the lottery’s deputy director. About 500 pubs are being targeted for the Quick Draw video terminals, he said.

“Customers get the same thrill of gambling without having to drive to the casino,” said Richard Keeler, owner of Side Street, the only bar in Mohawk, a central New York town with about 2,500 residents.

Side Street, which sells no food, got its terminal six weeks ago. The game attracts customers and keeps them there longer, which is especially helpful in the summer, when outdoor activities keep people away, Keeler said. Establishments hosting the machines earn 0.6 cents on every dollar wagered.

Cuomo, a 54-year-old Democrat, joins U.S. governors from Colorado to New Jersey in pushing for more gambling revenue. He persuaded the Legislature this year to approve a constitutional amendment allowing seven Las Vegas-style casinos. He’s pointed out to voters, who must approve the amendment in a referendum, that gambling already exists in the state at Indian-run casinos and nine racetracks with electronic slot machines.

Stay Longer

Quick Draw resembles the casino game keno. Customers choose numbers and can win from $1 to $100,000, depending on how many they match to a drawing displayed on a video screen. There’s a new drawing every four minutes, except between 3:30 a.m. and 4 a.m. Wagers in New York’s version start at $1, and customers can pay with cash or credit cards. The lottery provides bar owners with a separate register for the game.

A requirement that establishments with Quick Draw make at least 25 percent of their sales food was part of the original 1995 law enabling the game. It was meant to overcome concerns about gambling in bars, said Scott Wexler, the executive director of the Empire State Restaurant and Tavern Association, an Albany-based lobbying group.

The three governors before Cuomo all tried to have the food prerequisite removed, and Cuomo tried to end it in last year’s budget. This year, he was successful. Shifting attitudes about gambling in the third-most-populous state helped, Wexler said.

More Comfortable

“People got more comfortable than they had in the past with gambling, helped by the larger messaging about casinos,”Wexler said in a telephone interview. “Once lawmakers agreed to allow seven casinos, why not take the revenue from Quick Draw?”

Cuomo has said New York needs to expand its gambling options to compete with surrounding states, including Massachusetts and Pennsylvania, which are moving forward with full-scale casinos. In New Jersey, Governor Chris Christie wants to legalize sports betting to lure customers to Atlantic City, which has 12 casinos.

The expansion of Quick Draw to bars that don’t serve food is projected to raise $11 million this fiscal year and $22 million every year after, said Morris Peters, a budget division spokesman.

In the fiscal year ended March 31, the lottery took in $8.44 billion from its games and the racetrack casinos, marking the 12th consecutive year of record sales and earnings. The revenue provided $2.9 billion for education, according to the lottery.

Cuomo’s successful initiative should have come with additional funding for programs to help gambling addicts, said Michelle Hadden, director of prevention and training for the Albany-based New York Council on Problem Gambling.

“We’re concerned any time we see safeguards being dropped,” Hadden said in a telephone interview. “Any time we see this kind of expansion, we would want to see expansion of services for problem gamblers. And that’s not happening.”

Josh Vlasto, a Cuomo spokesman, didn’t respond to e-mails and phone calls requesting comment.

To contact the reporter on this story: Freeman Klopott in Albany, New York, at fklopott@bloomberg.net

To contact the editor responsible for this story: Stephen Merelman at smerelman@bloomberg.net