Cover photo – Boyle and public officials break ground on the expansion at Jake’s 58 Casino in April (Credit – Matt Meduri)
Since its opening in 2017, Jake’s 58 Casino and Hotel has been a unique attraction for Suffolk County residents looking to take risks and perhaps spend the weekend. The casino is also unique by its identity as one of just two government-owned casinos in the entire country. All profits from the casino go to the New York State Department of Education, Suffolk County, and the Village of Islandia.
However, Jake’s 58 recently announced a massive undertaking: an expansion set to double the size of the entire facility. The May groundbreaking started a project that is set to bring in more food, more entertainment, more destination-like attractions, and, of course, more games.
The Messenger sat down with Suffolk Off-Track Betting (OTB) and Jake’s 58 President and CEO Phil Boyle to discuss the expansion.
Boyle, a resident of Bay Shore, served in the New York State Assembly for a collective sixteen years, followed by ten years in the State Senate. Leveraging his career as a lawyer and his decades of government experience and believing it was “time for a new challenge,” Boyle took on the monumental task of guiding Jake’s 58 and OTB not only into a new era of modern gambling and the expansion of the casino, but also into an era of relatively uncharted waters.
The History
New York State OTB consists of five OTB regions. All OTBs in New York are public benefit corporations, whose profits go to the counties in which they operate. Due to declining horse betting revenues, Suffolk OTB declared bankruptcy in 2011, but the company wasn’t eager to cash out just yet. With just one casino – Jake’s 58 – with 1,000 machines, creditors were paid back in just two years, with the casino now turning in massive profits.
In 2013, realizing the losses of revenue to out-of-state gambling tourism and underground betting in New York, then-Governor Andrew Cuomo (D) and the state legislature decided to implement seven casinos across the state. The first four were built in Upstate New York, primarily to address the region’s cratering economy, and after a five-year break, the remaining three were built downstate.
The Expansion
Looking to augment the casino’s already-massive successes, Suffolk OTB recently launched a $210 million expansion that will effectively double the size of Jake’s 58.
“We’re going from 1,000 video lottery terminal (VLT) machines, or slot machines, to 2,000 in a brand-new building,” Boyle told The Messenger. “At the same time, we’re going to renovate the current hotel and casino. It’s been decades since the 210 rooms have been truly updated.”
Boyle discussed some of the prominent features of the expansion, including a VIP lounge, a conference center, a gym, a spa, and hopefully Long Island’s first sportsbook.
“We have a number of amenities that people are really going to like,” said Boyle, making specific reference to a food hall, essentially a corridor consisting of different dining options, including contracts with big-name fast-food chains.
“We’re looking at four or five different restaurants, such as a Mexican place and a steakhouse,” said Boyle. “We’re also working on a couple of big [chain] names to bring into Jake’s.”
A large aspect of the project is the construction of a new casino building just north of the existing structure, one that will contain all or most of the slot machines Jake’s offers.
“Right now, we’re planning on moving the 1,000 existing machines and the 1,000 new machines moved over to the new building,” said Boyle. Such a move will leave the existing location open for the amenities.
“We might have some machines in the existing building, but the lion’s share will be in the new structure. We have Las Vegas casino experts advising us on the layout of the new building,” said Boyle.
The VIP lounge will offer a classic casino amenity to guests looking for such an experience without having to drive upstate or take a ferry to Connecticut, complete with comfortable chairs, a bar, and possibly even a cigar patio.
However, of particular buzz is the much-awaited sportsbook.
“New York State law says that a facility can only have a sportsbook if they are a class-three casino, which primarily have poker and Blackjack. We are a class-two casino because we have no table games, only slot machines. The sportsbook would require a change in the law,” said Boyle.
A typical sportsbook consists of couches, chairs, tables, chicken wings, and drinks, and allows players to watch the sports games on which they’re betting, or even to watch games or races in which they have no literal or figurative horse. Sportsbooks as seen in Las Vegas, Atlantic City, or even at Mohegan Sun, have numerous televisions with tickers running across the screens with all the pertinent betting information on constant display.
Boyle also discussed a unique aspect of gambling in the Twenty-First Century and how it can be an asset to Suffolk OTB’s business: mobile betting.
“Right now, the law allows us to run what I would describe as mobile sportsbook. We could partner with a company for mobile sports betting. You would still be betting on your phone, but if you bet on your phone while in our casino, we would get a little cut, but you would also have the amenities available. We hope to get more people coming in that way,” said Boyle.
Boyle also mentioned the nearby Racing Forum-Village Idiot location on Motor Parkway in Hauppauge, a 17,000-square-foot facility with numerous television sets that is geared towards horse racing. Boyle says that while horse racing is a more old-fashioned form of gambling, it’s possible to open that practice up to a younger crowd through the mobile betting partnerships.
Boyle is also hopeful that the Jake’s expansion makes the facility more of a destination, rather than just a casino, vis-à-vis the options set to be offered.
“As a member of the Great River Volunteer Fire Department for many years, my goal is to have fire department installation dinners in the conference center. I think there’s ample opportunity for growth and expansion there,” said Boyle. The conference center could double for corporate meetings, as well as private parties, weddings, or family gatherings, typical of a classic party hall. Jake’s could also offer its service as a small-scale venue for entertainment, such as musical acts, stand-up comedians, and other live shows.
Parking has been perhaps the biggest concern of Jake’s 58 regulars. Boyle says that parking capacity is expected to increase from 600 spots to 2,000 spots, in part facilitated by a multi-story parking garage and electric vehicle charging stations.
What makes Jake’s 58 different from other well-known casinos is its lack of live table games. The casino currently offers Blackjack, poker, roulette, and craps, but in electronic forms. Boyle says that a license for live table dealers at Jake’s 58 is currently off the green-felt table.
“There are about a dozen proposals for the three downstate casino licenses that can be issued. Just to get that license from New York State costs $500 million, before anything is even built,” said Boyle, referencing the contentious bidding process for the paltry number of licenses currently being offered by New York State.
“We are a government entity; that’s too rich for our blood. That’s up to Sands and Bally’s and the other big names to pay that much money. We’re going to stick with our slot machines.”
However, Boyle says that Jake’s slot machines are worth their weight in chips, a perk of playing just off exit 58.
The Numbers
“Our slot machine odds are actually better than other casinos. Vegas casinos can dial the machines down to set the payout. Our machines, by law, have to be set at 94% going back to the customers,” said Boyle. “Even if we have a bad month, 94 cents of every dollar goes back to the players in wins. Our profit margin is just six cents on every dollar, and because we are a public benefit corporation, by law, we have to give 45% of our profits to the New York State Education Fund. 45% of that 6% profit is what goes to the NYS Education Fund.”
The 2023 annual totals for Jake’s 58 show that over $123 million was paid to the NYS Department of Education, accounting for 2.9% of amounts wagered by players. Another $27 million was paid to the NYS Gaming Commission, 0.6% of amounts wagered, followed by $11.6 million to Suffolk County, $13.6 million to the NYS horse racing industry, 0.3% of amounts wagered, and a $2.25 million rights fee to the Village of Islandia.
“We have to run this place, and we have about five hundred employees. Our profit margin really comes out to just two cents on the dollar,” said Boyle.
Residents of the Village of Islandia cash in on an exclusive perk for serving as the casino’s home. The Village is already offsetting municipal costs from the $2.25 million flat rate OTB pays, regardless of the casino’s profitability. The casino’s contract with the Village will double to $4.25 million once the number of machines doubles. At that point, residents of Islandia will no longer have to pay Village taxes.
5% of earnings go to the Horse Breeders Association to help the horse racing industry, the remainder goes to the County. Last year, because of financing for the expansion, OTB temporarily reduced the yearly contribution to the County’s coffers until the project’s expansion is complete.
The Outlook
Boyle is confident in a two-year plan from the groundbreaking to the ribbon-cutting for the new building.
“My goal is to have our ribbon-cutting before the other proposed casino project, and even have the ground-breaking,” said Boyle
“We’re also moving our [Suffolk OTB] corporate headquarters. We bought the IRS Building on Veterans Memorial Highway and we’re hoping to move in by the beginning of the year,” said Boyle. He also remains optimistic about Suffolk OTB’s future.
“Instead of working with 1970s numbers, we have 2024 numbers,” said Boyle, adding that metrics and previously settled sciences of the regulated gaming industry were – mostly – not worth the cashier checks on which they were printed. The somewhat-esoteric horse racing scene has had a meteoric fall from grace over the decades and the advent of online betting somewhat shuffled the airwaves of brick-and-mortar casinos’ viability.
Suffolk OTB also has almost fifty quick-bet locations where players can bet on horses and games. They can be found at bars, restaurants, and card stores across Suffolk County, an aspect of managing OTB that Boyle says contributes to the “many moving parts” of the business.
The Messenger thanks Phil Boyle for his time and insight of the project, and we’d be remiss if we bet against this house any time soon.
Jake’s 58 Casino Hotel is located at 3635 Express Drive North in Islandia.
