On Tuesday (14th), MGM Resorts International’s subsidiary, MGM Yonkers Inc., suddenly withdrew its application for a commercial gambling license to expand the Empire City Rasino in Yonkers, New York, from both the New York State Gaming Commission and Gaming Facility Location Board.
The New York State government is issuing up to three gambling licenses to downstate by the end of this year. With Empire City Rasino’s withdrawal, three competing projects remain, including Metropolitan Park in the Willets Point area of Queens, Resorts World in South Ozone Park, Queens, and Bally’s Bronx in the Bronx (formerly Trump Golf Course).
The reason for Empire City Rasino’s withdrawal is that their $2.3 billion development project’s financial projections were based on obtaining a 30-year commercial gambling license. MGM Yonkers Inc. stated in a press release, “The new competitive landscape – with four proposals concentrated in a small geographical area – presents challenges to the anticipated returns for our initial project. Additionally, our proposal to renovate and expand the Empire City Casino was based on the premise of obtaining a 30-year commercial gambling license, but according to new guidance issued by New York State, we now anticipate only being able to obtain a 15-year license.”
The decision to withdraw sparked strong criticism from Yonkers Mayor Mike Spano, who issued a statement on Tuesday urging Governor Hochul to launch an independent investigation into the matter, stating that MGM’s 180-degree turnaround reason is fundamentally unfounded. However, Hochul responded on Wednesday that she had no reason to initiate an investigation, believing that MGM may have made their financial decision based on their own needs.
The Trump Organization also responded to Spano’s comments, stating in a press release that MGM’s decision to withdraw from the Yonkers gambling license bidding process had nothing to do with The Trump Organization. Any insinuation otherwise is completely false, irresponsible, and pure speculation. MGM stated in their release that the decision to withdraw from the bidding process was due to “changes” in the “competitive and economic assumptions” that supported the company’s application for a license, including the state government shortening the proposed license term from 30 years to 15 years.
Yonkers residents are concerned that MGM may close the Empire City Casino after a new casino is opened in New York City. MGM has stated their commitment to keeping the venue open, but when asked if they would commit to keeping it open for another five or ten years, the company refused to answer.
New York State plans to issue three commercial gambling licenses by the end of the year, but it is not guaranteed that all will be issued. Depending on economic conditions, one, two, or even none of the licenses could be issued. The final decision rests with the New York Gaming Facility Location Board, composed of five experts, who will recommend candidates to the New York State Gaming Commission.
The New York Gaming Facility Location Board is responsible for evaluating and recommending, based on scoring criteria, up to three projects to the New York State Gaming Commission, who will decide on the final project to be awarded the commercial gambling license by vote, to be issued by December 31st.