The Social Gaming Leadership Alliance (SGLA) has raised alarms about an impending prohibition on online social games featuring sweepstakes promotions, which they estimate could eliminate over $230 million in yearly economic benefits for New York. This assertion is backed by fresh assessments from research agency Eilers & Krejcik commissioned by the organization.
The coalition within the industry believes that appropriate regulation could yield more than $80 million in new annual tax revenue via operator registration fees, tax on player transactions, and broader market access opportunities.
In 2024, the sweepstakes promotions sector was said to contribute more than $135 million in interchange fees to card issuers based in New York, as indicated by the findings. This sector also generated over $15 million in payment processing and card network fees for firms such as Mastercard and American Express, alongside $44 million from affiliation agreements, and $38 million in household income from jobs tied to the industry.
Current legislation S. 5935-A / A. 6745-A is under the scrutiny of Governor Kathy Hochul. The SGLA is advocating for a veto, asserting that a structured regulatory framework would maintain the economic advantages while also ensuring consumer protection.
“Governor Hochul stands at a decisive crossroads: Adopt sensible regulation that safeguards consumers and generates additional revenues or outlaw a flourishing, responsible sector and forfeit hundreds of millions in economic gains,” stated Jeff Duncan, Executive Director of the Social Gaming Leadership Alliance. “We implore the Governor to veto this bill and endorse a framework that guarantees these games remain safe, accessible, and beneficial for New Yorkers.”
The SGLA noted that a recent nationwide survey revealed that 84% of Americans back the modernization of laws to regulate and tax online social games, and that voters prefer lawmakers to address pressing issues such as inflation, living costs, healthcare, and immigration rather than imposing bans on free-to-play entertainment.
Previously, the SGLA expressed frustration over actions taken in California, where Assembly Bill 831 outlawed online social games involving sweepstakes promotions. States like Nevada, Montana, New Jersey, and Louisiana have also enacted measures against sweepstakes casinos.
In a separate context, lawmakers in New York are considering additional consumer protection legislation. A proposed bill by Assemblymember Alex Bores seeks to stop licensed sportsbooks from limiting or reducing wager amounts for regular winners unless linked to responsible gambling or sports integrity concerns. If passed, the New York State Gaming Commission is expected to enforce this measure.