The Associated Press

The group that represents video slot machine centers at race tracks says casino expansion in New York will cost taxpayers and schools millions of dollars without creating substantially more jobs.

The New York Gaming Association had lobbied to turn their “racinos” at race tracks into the Las Vegas-type casinos proposed by Gov. Andrew Cuomo. But the racino group says the deal being struck behind closed doors in Albany will cost New Yorkers and schools $1 billion a year in gambling revenue.

The proposed Las Vegas-type casinos will “instead simply cannibalize as much as 85 percent of the state’s current gaming market, shifting revenue and jobs from one facility to another but resulting in no real increase in new jobs and an annual loss of $1 billion of tax revenue for education,” said New York Gaming Association President James Featherstonhaugh.

The casinos as currently proposed would pay $50 million for a state license, but as little as 25 percent of income back to the state, most of which would go to education and some to the upstate communities where the casinos will be located. By comparison, racinos provide 67 percent of revenue to the state. Three to five upstate casinos have been proposed, but no locations have been determined.

“It’s a completely unfair playing field,” Featherstonhaugh told The Associated Press. “They say we could compete, but there’s no way we could win.”

He said Vegas-style resort casinos will also drain customers from the racinos to casinos.

He also claims racinos could start creating permanent casino jobs in 2015, but says new casinos couldn’t start creating permanent jobs until 2017 because of the longer construction period that would be needed.

Featherstonhaugh said the briefings he attended were still considering authorizing major video slot centers in western New York and on Long Island, but no decisions were made.

Cuomo spokesman Rich Azzopardi said casino licenses will be awarded on a competitive basis to assure the best deal for New York and racinos shouldn’t have expected to be “grandfathered” in. He noted the racinos also didn’t have to pay large licensing fees as casino operators will pay.

“The governor’s legislation ensures that the existing racinos and out of state developers both have a level playing field to compete for the newly authorized resort destinations,” Azzopardi said. “The tax rate set in the legislation is competitive with neighboring states and designed to maximize the economic development potential of these projects.”

Legislative leaders emerged from private negotiations with Cuomo on Monday saying no final deal is set.

“We are talking about where we are,” said Assembly Speaker Sheldon Silver.

Senate Republican leader Dean Skelos said there has not been a decision yet on whether to authorize three or four or five casinos.