On Long Island, Jake's 58 Casino Hotel has filed an appeal against a fine imposed by the New York State Gaming Commission for failing to get the required gaming licenses for over twenty-two employees.

The public company that owns and runs the video lottery casino and hotel, Suffolk Regional Off-Track Betting Corporation (Suffolk OTB), was informed in December by the state's gaming regulatory agency that 34 of its staff lacked the required licenses.

According to the commission, 25 employees had licenses that were either wrong or expired, and nine employees were operating without one. Newsday used a Freedom of Information Law request to obtain information about the purported regulatory infractions.

On April 1, the gaming commission fined Suffolk OTB $26,000 for having 26 employees who still lacked proper authorization. According to Newsday, Jake, 58, is contesting the fine on the grounds that the infractions date back to the time Delaware North operated the casino.

Complaints about Compliance

Delaware North, a gaming and hospitality corporation located in Buffalo, New York, helped Suffolk open the video lottery casino within a former Marriott hotel in early 2017. Suffolk OTB purchased Jake's 58 from Delaware North in 2021 for a sum of $120 million. More than 1,000 video lottery terminals (VLTs), which resemble slots and are run by a centralized lottery network, are available at Jake's.

There are 11 VLT casinos in the state, including Jake's. Roughly 46% of the total gaming revenue generated by the electronic table games and terminals is retained by each VLT casino. Ten percent is set out for vendors and the management of the central lottery system, with the remaining forty-four percent going toward state education.

The $210 million expansion and renovation project at Suffolk is expected to quadruple the number of VLT positions and remodel all 210 of the hotel's guestrooms. New eateries and bars, a multistory parking structure, the reopening of an indoor pool, and a sound barrier to reduce noise pollution into the neighboring neighborhood are all included in the investment.

State gaming authorities say Suffolk needs to do more to maintain its workforce's regulatory compliance even as the growth continues. The organization is currently looking for a newly formed full-time position that will supervise employee licensing, Suffolk OTB CEO Phil Boyle told Newsday.

According to Boyle, the state's concerns about staff license infractions mainly pertained to the casino's operations during Delaware North's management.

"Though we were only recently notified of any issues … questions date back to when Delaware North ran Jake’s 58 Casino Hotel. It is our intention to address them, resolve them, and become a statewide model for other casinos to follow regarding license compliance,” Boyle told the Long Island news outlet.

Delaware North claims in a statement to Casino.org that it was unaware of employee non-compliance while managing Jake's 58.

"Delaware North operated gaming at Jake’s 58 under a management contract with Suffolk Regional Off-Track Betting from the venue’s opening in February 2017 to May 2021. Delaware North did not receive any notices of employee licensing violations during its period of managing Jake’s 58 on behalf of [Suffolk OTB]. Delaware North is strongly committed to gaming compliance, including employee licensing, at our casinos and other gaming venues in New York, seven other states and Australia,” the Delaware North statement read.

Potential Rivalry 
If Las Vegas Sands obtains one of the three downstate casino licenses that the state is anticipated to award next year, Jake's may face additional competition from the gaming industry.

At the Nassau Veterans Memorial Coliseum property, Sands is requesting a permit to build an integrated resort casino, valued at $6 billion. Jake's is located roughly thirty miles to the east of Sands' proposed casino site.

Nonetheless, there is still a lot of local opposition to the Sands proposal. Moreover, Resorts World New York City, a Queens video lottery racino that is favored for one of the three downstate licenses, is only 20 miles east of the Nassau Coliseum property.

Jake's is not putting in a proposal for a full-scale gaming license, which would grant access to sports betting, live dealer table games, and slot machines a la Vegas.