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It looks like it will come down to tax rates and top scores for mobile sports betting platform providers that want to make it in New York

The New York State Gaming Commission released detailed scoring and pricing rules in its request for applications (RFA) on Friday. Both the RFA and related pre-proposal draft regs will guide the state’s selection of at least two mobile sports wagering platform providers and at least four mobile operators under the fiscal year 2022 state budget, with a tentative application deadline set for Aug. 9, 2021. 

Tax rates proposed by applicants as part of a required “pricing matrix” — a mix of competitive tax scenarios based on potential mobile sports betting platform providers and operators– will be factored into the final selection of licensees, per the RFA.

New York is expected to select those mobile sports betting platform provider applicants considered for licensure by Dec. 6, 2021. Licenses then would be tentatively awarded at the Commission’s next meeting.

How Will Scoring Work Under New York’s RFA Process? 

Scoring will be based largely on technical factors, although proposed tax rates and potential bonus points will add to the cumulative total. 

Only applicants that have a minimum of 60 points out of a possible 75-point “Technical Factor Score” and have submitted a pricing matrix data will advance to the next stage in the process. Final scores will be tabulated by adding the Technical Factor Score, a Pricing Factor Score, and a five-point bonus for applicants (if any) engaged in revenue-sharing with tribes under compact to conduct gaming in New York.

Applicants with a higher Pricing Factor Score will be ranked higher in case of a tie. 

Here’s how criteria will be scored in each category, per the RFA: 

Technical Factor Scoring Criteria (75 points max.): 

25 points — Expertise in the market of the Applicant and the Applicant’s Proposed Operators

20 points — Integrity, sustainability and safety of the Mobile Sports Wagering Platform

15 points — Past relevant experience of the Applicant and the Applicant’s proposed Operators

7.5 points — Advertising and promotional plans

2.5 points — Capacity to rapidly and efficiently bring Authorized Sports Bettors into the Applicant’s Platform

2.5 points — Applicant’s efforts to foster racial, ethnic, and gender diversity in Applicant’s workforce and the each of the Applicant’s proposed Operators’ workforce

2.5 points — Other factors affecting revenue to New York State

Pricing Factor Scoring Criteria (based on applicant’s proposed tax rate on mobile sports wagering GGR): 

3 points — Tax rate of 12.5 percent to 30 percent 

10 points — Tax rate of 30 percent to 40 percent

15 points — Tax rate of 40 percent to 50 percent

20 points — Tax rate of 50 percent

* An additional point will be given for each full percentage point over 50 percent, per the RFA

The Pricing Factor Score, it appears, is based on tax rates in the pricing matrix submitted by each applicant. Here’s how the pricing matrix requirement will work: 

  • Applicants must enter a tax rate of at least 50 percent for their “preferred scenario” based on the statutory minimum of two platform providers and four operators. 
  • If an applicant prefers a bidding scenario with fewer than the statutory minimum of providers and operators, it must enter a tax rate of at least 50 percent based on that scenario. 
  • A tax rate of zero must be entered if an applicant doesn’t want to compete against different levels of platform providers and operators. 

How Will Scoring Affect Ranking And Final Selection? 

The RFA spells out clearly how the ranking process for selection of mobile sports betting platform providers in New York will proceed. 

  • Qualified applicants will be ranked initially by the sum of their Technical Factor score and the 5-point Bonus.
  • Qualified applicants with the highest initial ranking that are bidding for at least two platform providers and four operators will be further vetted based on pricing considerations. 
  • Qualified applicants with the highest initial ranking bidding for fewer than two platform providers and four operators will be vetted from a larger group of qualified applicants.

When at least two platform providers and four operators have been identified, the state will compare each applicant’s pricing matrix. The highest tax rate for each scenario in the matrix will be recorded, placing those applicants in the pipeline for final selection. 

Timeline For Selection Of Mobile Sports Betting Platform Providers (Tentative)

  • July 9 – RFA issued by New York State Gaming Commission 
  • July 16 – Applicants’ First Questions Due by 3 p.m. EDT
  • July 22 – Commission Response to First Questions
  • July 27 — Applicants’ Second Questions Due by 3 p.m. EDT
  • Aug. 2 – Commission Response to Second Questions
  • Aug. 9 – Applications Due by 4 p.m. EDT
  • Sept. 1 – Oral Presentations of Applicants May Begin
  • Dec. 6 – Tentative Deadline For Selection of Applicants Considered for Licensure 

How Many Sports Betting Apps Can We Expect In New York?

It remains unclear how many companies will be able to launch sports betting apps in New York. At the time the bill passed in April 2021, it seemed that New York would license two platforms and a minimum of four apps.

The RFA seems to be more clear in that the Gaming Commission issued the RFA to license two or more mobile betting platform providers. This leaves open the door to a more competitive environment than initially thought, but the final number of skins available to bettors is still uncertain.

About the Author
Rebecca Hanchett

Rebecca Hanchett

Writer and Contributor
Rebecca Hanchett is a political writer based in Kentucky's Bluegrass region who covers legislative developments at Gaming Today. She worked as a public affairs specialist for 23 years at the Kentucky State Capitol. A University of Kentucky grad, she has been known to watch UK basketball from time to time.

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