New York Franchise Award Recommendation May Come Nov. 21

[Indulto]

http://www.bloodhorse.com/horse-racing/articles/57088/paterson-says-nyra-will-get-state-bailout?source=rss
Paterson Says NYRA Will Get State Bailout
By Tom Precious May 18, 2010… "We have a plan to loan NYRA, in the short term, money to get through Saratoga and we’re working on a long-term plan to help them beyond that," Paterson said.

... "I think they’ll pass it," Paterson said of lawmakers and the new bailout plan.

But Assembly Speaker Sheldon Silver did not commit to passing the NYRA bill. "I haven’t seen the bill yet," Silver said.

Nor has Assembly Racing Committee chairman Gary Pretlow. But he said he is confident state help for NYRA is on the way. "We’re not going to let Saratoga fail," Pretlow said of the upcoming race meet.

… A deal signed by the state several years ago provides that the state will make a good faith effort to help NYRA if it faced financial trouble if the long-delayed Aqueduct casino was not operating by April 2009.

Further, NYRA officials argue that the state--because it now owns NYCOTB--is on the hook for the money owed NYRA by the OTB giant. NYCOTB, in its Chapter 9 bankruptcy filing, acknowledges a $15 million debt to NYRA; officials at NYRA have said that amount has since grown to $17 million.

"NYRA has a good case for the money," Pretlow said. "OTB is the state and OTB owes NYRA, ergo, the state owes NYRA."

State officials said the new borrowing plan envisions the state Empire State Development Corp., a state agency that runs economic development efforts, lend NYRA between $15 million and $25 million. They said the plan would get around state constitutional prohibitions on gifts or loans of credit by terming the loan a “working capital’’ borrowing that NYRA would have to pay back before next March 31, which is the end of the state’s 2010 fiscal year.

If NYRA does not repay the loan, the proceeds would be taken from future revenues NYRA expects from a casino at Aqueduct racetrack. The Paterson administration expects a casino operator to be tapped–in what is now the fourth separate bidding process for the racino–sometime in early August. …http://www.timesunion.com/AspStories/story.asp?storyID=932295
Bailout loan for NYRA in works
Saratoga, Belmont meets to be saved by state note for up to $25 million
By JAMES M. ODATO AND LEIGH HORNBECK
May 19, 2010… Hayward said NYRA needs $20 million -- "a small amount given the $90 million NYRA and OTB pay in taxes and fees to the state each year."

Dan Silver, spokesman for Hayward, said the numbers are based on a state report from 2008. …http://www.saratogian.com/articles/2010/05/18/sports/doc4bf351af20e06728785651.txt (http://www.saratogian.com/articles/2010/05/18/sports/doc4bf351af20e06728785651.txt)
VEITCH: Plenty of problems with New York racing
By Mike Veitch May 18, 2010…You would be inclined to say this is all hard to believe, except that New Yorkers do believe it, as residents of the most dysfunctional state in the Union.

… Rumors circulate about wealthy NYRA board members considering putting forth some help.

It’s a nice thought, and heaven knows there are thousands of workers out there hoping for help, but it does nothing to address the very serious structural problems in New York racing.

… Even if Albany somehow comes up with an assist to get NYRA through the end of the

year, it does not address widening cracks in the state industry.

It is long past time for the off-track betting system and the track operator to be working together.

… There is too much racing at NYRA tracks today, and that includes Saratoga, which is almost certain to have some dreadfully bad cards in the 40-day schedule this summer.

It is also time for a review, by racing leaders, of just how it promotes thoroughbred racing.

A suggestion here is to back off the incessant emphasis on gambling.

… If wealthy patrons, at any time prior to the franchise renewal in 2008, had offered to deal with NYRA’s growing financial losses, the picture might be different today.

... Today, we are stuck with a situation that is going to repeat itself now that these three tracks are in state hands.

There would also be some $4 million more on hand for NYRA today if its board did not reject plans to close the race-day detention barn and the training program at Aqueduct.

Bad call there.

… Shortly after the current franchise was renewed, Hayward shared with me his dream that the new deal signaled a chance to revitalize the game.

His hopes included the concept of a racing trust at Saratoga and Belmont, one that recognized the historical significance of both places, founded on tremendous thoroughbred racing and its attendant cultural activities. …

[Indulto]

http://www.drf.com/news/article/113105.html (http://www.drf.com/news/article/113105.html)
Audit: New York OTBs should pay less to racing
By Matt Hegarty5/20/2010New York's five regional off-track betting corporations must be allowed to cut their payments to the racing industry in order to remain solvent, the state's comptroller, Thomas P. DiNapoli, said in an audit of the corporations released on Thursday.

… "If OTBs are going to remain viable, New York will have to take action to bring back the bettors and fix OTB," DiNapoli said. "The current business model just doesn't work."

… The audit also said that the county-owned OTB companies are facing significant competition from casinos in New York and neighboring states and from out-of-state account-wagering companies. However, the report also acknowledged that only two of the companies, Capital and Nassau, operate their own Internet wagering platforms despite legislation that was passed four years ago legalizing the practice.

According to the audit, the net operating revenue of the five companies declined by 67 percent from 2004 to 2008. Part of that decline was due to an industry-wide contraction in handle, the audit said, but the audit also blamed "up front" payments to the racing industries for contributing to the decline while crediting the OTB companies for reducing some expenses.

"We believe that corporations will be unable to cut expenses fast enough to continue as financially viable entities if no action is taken to reduce these required payments," the audit said.

The audit specifically singled out payments to the harness industry required by law when New York's OTBs take night-time simulcast signals. Those payments are "outdated and too high," the audit said.http://www.nypost.com/p/news/local/gov_eyes_new_otb_jockey_g84U7fZJC0dqWvXDVavJAN (http://www.nypost.com/p/news/local/gov_eyes_new_otb_jockey_g84U7fZJC0dqWvXDVavJAN)
Gov eyes new OTB jockey
By FREDRIC U. DICKER May 20, 2010Gov. Paterson has lost confidence in Meyer "Sandy" Frucher's ability to run the bankrupt and embattled New York City Off-Track Betting Corp., and would "accept his resignation if offered," The Post has learned.

"Sandy has no credibility left in Albany. He doesn't know when to compromise, and he's lied repeatedly to the officials he has to deal with," said a source familiar with the situation.

"Sandy has also done something that people never thought was possible: He's united the entire racing industry against him . . . If Sandy offered his resignation, it would be accepted."

… Frucher has been holding back millions of dollars in payments owed to the NYRA by the OTB, citing the agency's ongoing bankruptcy proceedings and cash-flow woes.

The source said Frucher had been warned by aides to Paterson that his policies risked "destroying New York's racing industry," a charge already made by thoroughbred owners and breeders associations.http://www.nypost.com/p/blogs/knickerbocker/paterson_offers_no_support_for_otb_mDwDR7XZZgZPEGr kfxA1eJ (http://www.nypost.com/p/blogs/knickerbocker/paterson_offers_no_support_for_otb_mDwDR7XZZgZPEGr kfxA1eJ)
Paterson offers no support for OTB chief
By BRENDAN SCOTT May 20, 2010… Paterson said only “we have to decide what’s best for the state,” when asked about an exclusive Post report (http://www.nypost.com/p/news/local/gov_eyes_new_otb_jockey_g84U7fZJC0dqWvXDVavJAN)tha t administration officials want Frucher to quit after a bumbling OTB bailout bid that infuriated lawmakers and much of the racing community.

“In the papers this morning, there’s indication that you would like to see Sandy Frucher, who runs OTB, out of town – get replaced,” WOR 710-AM host John Gambling asked the governor during an interview.

“Well… Not necessarily,” Paterson said. “It’s just at this point we have to decide what’s best for the people of the state of New York.

“You can’t keep running to the state,” the governor continued. “As you see, what’s happening now is that when other entities are collapsing, they’re blaming the state. OTB has really not been profitable.”

Paterson tapped the former Philadelphia Stock Exchange chief and longtime advisor to former Gov. Mario Cuomo (http://www.nypost.com/t/Mario_Cuomo) last June to help rescue to long-struggling bookmaking operation from bankruptcy.

But Frucher angered many state leaders after threatening to shutdown OTB if the agency didn’t get a state bailout. The bailout never came and OTB stayed open, confirming, for some, suspicions that Frucher had exaggerated the crisis. …

[46zilzal]

Good you posted Michael Veitch's article as he lives right there and has his hand on the pulse of the problem.

[PaceAdvantage]

Good you posted Michael Veitch's article as he lives right there and has his hand on the pulse of the problem.How can you say this when he makes the following statement:A suggestion here is to back off the incessant emphasis on gambling.WHAT incessant emphasis on gambling? That's part of the problem! They DON'T promote the fact that this is one of the FEW forms of wagering where you actually have a shot at coming out AHEAD in the end...unlike casino gambling or the lottery (unless you're extremely lucky), where you are pretty much a guaranteed loser no matter what you do or how hard you work at getting better...

For a man whom you claim has his hand on the pulse of the problem, that is just an incredible statement from where I sit.

[slewis]

How can you say this when he makes the following statement:WHAT incessant emphasis on gambling? That's part of the problem! They DON'T promote the fact that this is one of the FEW forms of wagering where you actually have a shot at coming out AHEAD in the end...unlike casino gambling or the lottery (unless you're extremely lucky), where you are pretty much a guaranteed loser no matter what you do or how hard you work at getting better...

For a man whom you claim has his hand on the pulse of the problem, that is just an incredible statement from where I sit.

Good point PA...

With all due respect ZIL, Mike Veitch is a big time ass kisser. I spend the entire meet up there, have for over a decade, and most of the local racing journalists are bad. Nick Kling is about the best.

But if we (and the press) dont start DEMANDING that racing management and EVERYONE involved in this sport, including it's journalists, start emphasizing GAMBLING as the true revenue stream for survival, the sport is doomed.

I want to see when things turn around (because I'm a racing optimist) how NYRA goes out and hires their next VP for a $200k per yr. plus salary.
I'll bet anyone he has LOTS of racing experience and NO gambling backround.

Anyone want to take me up on that bet?

[Indulto]

http://www.drf.com/news/article/113151.html (http://www.drf.com/news/article/113151.html)
NYRA says it will close June 9
By Matt Hegarty 5/21/2010The New York Racing Association notified its employees on Thursday that it will close its three racetracks beginning June 9 if the association does not receive financial assistance from the state, the association said.

The notices are required under state and federal law if a business anticipates shutting down within 60 days. …

… Although some influential legislators and Gov. David Paterson have said that they are committed to finding a way to assist NYRA, other legislators have balked at providing money to the association at a time of deep budget cuts in New York. …http://www.drf.com/news/article/113152.html
More signals pulled from New York OTB
By Matt Hegarty 5/21/2010The number of racing signals available to customers of the bankrupt New York City Off-Track Betting Corporation dwindled even further on Thursday with an order by state regulators to pull the signal from Hollywood Park, Churchill Downs, and Calder Race Course.

The order from the New York State Racing and Wagering Board reduced New York City OTB's Friday afternoon Thoroughbred menu to two New York tracks, Belmont Park and Finger Lakes - both are required to be carried by law - and Golden Gate Fields. In addition to ordering the signals pulled, the board also told New York City OTB that it would not approve the company's simulcast contract with Monmouth Park, which opens on Saturday.

In a letter sent to New York City OTB on Thursday, the board claimed that it "has no record" of approving simulcasting contracts with the tracks. The letter, which was released to Daily Racing Form after a request by the publication, said the board is "reviewing whether or not sanctions related to the simulcasting activity referenced should be recommended or imposed."

… In addition to accusations that New York City OTB did not receive approvals to offer the tracks, the board notified OTB three weeks ago that it would not approve any other simulcast contracts until OTB "assures us that they are able to meet their financial obligations," according to Joe Mahoney, a spokesman for the board

… Most significantly, the orders to pull the signals could drive many customers of New York City OTB to wager more on the signals that are still available, particularly Belmont Park, which is operated by the New York Racing Association. New York City OTB owes NYRA $17 million.

As part of its bankruptcy reorganization, New York City OTB has delayed making statutorily required payments to New York tracks on wagers made by its customers on out-of-state tracks. Regulators have cited that decision in making the case that they are uncertain whether the company is meeting its financial obligations. …
http://www.drf.com/news/article/113185.html
Enjoy seaside riches while they last
By Steven Crist 5/21/2010[QUOTE]… Everyone expects New York to come up with its promised $17 million for Belmont before June 9 -- the notices sent out are a legal requirement and a standard part of the political theater of threatened shutdowns in New York racing politics. As the issue gains even more public attention in the spotlight of the Belmont Stakes on June 5, a solution will be found. The holdup so far has been on the technical mechanisms for the loan rather than anyone's arguing that Belmont should be starved into extinction.

Eventually an Aqueduct racino operator will be chosen -- even though "eventually" has taken eight and a half years so far since voters approved racinos in November 2001. The state can not wait much longer though, since it is facing a $9.2 billion budget deficit and is losing at least $1 million a day in revenue without the Aqueduct racino. Once that happens it will take at least a year to get the slots spinning, but once they do, even conservative estimates are that New York's race purses will increase by at least 30 percent. …/QUOTE]

[Indulto]

http://www.empirepage.com/2010/5/25/interview-with-bennett-liebman-executive-director-of-the-government-law-center-albany-law-school (http://www.empirepage.com/2010/5/25/interview-with-bennett-liebman-executive-director-of-the-government-law-center-albany-law-school)
Interview with Bennett Liebman, Executive Director of the Government Law Center, Albany Law School
May 25th, 2010… Liebman: Quite frankly, everything is dependent on some continued public interest in horse racing. If people don’t bet on racing, there is little we can do to make the industry work. To paraphrase Yogi Berra, “If the fans don'tcome out to the racetrack or the OTB, you can'tstop them." The racing industry is certainly vitally important to the Saratoga area and to those counties with major breeding operations. We shouldn’t let them fail. To help NYRA and to help these regions, I think NYRA needs somewhat added flexibility in its choice of dates. And it needs to be able to develop a fully operative capacity to work with the entire industry in New York to create a single site to take Internet and account wagers. We still need to make it simpler for people to place bets on horse racing.

… Liebman: It would be nice, and it would be certainly helpful if we could coordinate and reorganize the OTB system. Nonetheless, the central problem isn’t who runs the OTB’s or how they make their payments to the racing industry and government. The issue is whether we can maintain any fan interest in horse racing. The national economy certainly hasn’t helped horse racing, but the sad fact is that unless we increase public support of horse racing, there is little that can be done by the government (short of giving them VLT’s) for the OTB’s.

Public interest in horse racing in New York has been declining steadily for more than a third of a century, if not longer. Adjusting for inflation, total New York State handle on horse racing in 2008 was 26.8% of what it was in 1978. When you adjust for inflation, New York handle on horse racing hasn’t been this low since 1942.If it continues to decline, then the laws of economics will eventually have their way with the OTB’s. If you care about horse racing, patronize a racetrack or an OTB. Don’t simply complain about the government.http://www.horseraceinsider.com/blog.php/Zasts-TrackWords/comments/2010-05-24saratoga-in-the-year-of-the-new-monmouth/#comments (http://www.horseraceinsider.com/blog.php/Zasts-TrackWords/comments/2010-05-24saratoga-in-the-year-of-the-new-monmouth/#comments)
Saratoga in the Year of the New Monmouth
By Vic Zast May 23, 2010… Guilt by association has damaged the Camelot quality of Saratoga. In its attempt to gain the notice of government, the horse racing industry has heaped so much negative publicity on itself in terms of its inability to exist without subsidy that patrons must wonder what is wrong with the sport. Each time an article that addresses the problems appears in The Saratogian newspaper, angry readers come forth like an oil spill. The worm is turning on NYRA despite that its business model was constructed on assumptions that the State created and then failed to deliver. Faith in the franchise is evaporating like a cold pad of butter on a hot cob of sweet corn.

Other options for summer fun are entering the minds of the faithful. It’s too late to create an upbeat impression for this year’s Saratoga meet to match the optimism that’s sweeping over Monmouth. Even if the dithering politicians save the day with the dough they owe NYRA, nothing corrective to the core problems will happen in New York until there’s a comprehensive overhaul. At this point, getting a law passed seems a pipedream.http://www.bloodhorse.com/horse-racing/articles/57171/new-york-lawmakers-approve-nyra-loan (http://www.bloodhorse.com/horse-racing/articles/57171/new-york-lawmakers-approve-nyra-loan)
New York Lawmakers Approve NYRA Loan
By Tom Precious May 25, 2010… Under terms of the deal, NYRA must repay the loan by next March 31, which is within the state’s 2010 fiscal year.

… The new borrowing idea lowers to $225 million from $250 million an appropriation previously approved for the Aqueduct working capital plan to be used by a future operator of the casino. The Paterson administration hopes to award a new agreement for the long-stalled casino sometime in early August.

… If NYRA does not pay back the loan by the end of next March, the state will take proceeds from the future casino operator – from money destined to NYRA as part of a revenue sharing deal – until the $25 million is repaid.

… The Assembly’s top Democrat backed the NYRA loan. “I think one crisis in the industry is enough. It’s a loan against something that’s clearly a recognized commodity that will easily be paid back,’’ said Assembly Speaker Sheldon Silver.

Assemblyman Gary Pretlow, chairman of the Assembly racing committee, said the measure could go to the floor for passage as soon as this afternoon. “I would hope it does,’’ Pretlow said when asked for its chances for passage.

Pretlow said NYRA would not be in the fiscal condition it faces were it not for the state’s failure to open the Aqueduct casino and the lapsed payments by NYCOTB. “We never should have gotten to this point,’’ he said. Pretlow was critical of what he called the “still bloated’’ management at NYCOTB that don’t “want to pay their bills.’’http://www.drf.com/news/article/113244.html
New York approves $25M loan to aid NYRA
By Matt Hegarty 5/25/2010… In a prepared statement, NYRA's chairman, Steven Duncker, said that the loan "guarantees world-class Thoroughbred racing" at the association's three tracks: Aqueduct, Belmont, and Saratoga. …

… the $25 million loan will sustain the organization until sometime during the middle of the next year, provided that New York City OTB's debt to the association does not rise significantly during that time period.

The bill providing for the loan was attached to legislation that was necessary for the state to continue paying its bills as the legislature attempts to address a $9 billion budget deficit.

… Morgan Hook, a spokesman for Paterson, said that "details are still being worked out" on when the state would release the money, though he said that the money will likely be released to NYRA in installments.

"NYRA will be funded and no races will need to be canceled," Hook said. …http://www.thoroughbredtimes.com/national-news/2010/May/25/New-York-OTB-ordered-to-stop-showing-out-of-state-simulcasts.aspx (http://www.thoroughbredtimes.com/national-news/2010/May/25/New-York-OTB-ordered-to-stop-showing-out-of-state-simulcasts.aspx)
New York OTB ordered to stop
showing out-of-state simulcasts
by Paul Post May 25, 2010… The New York State Racing and Wagering Board has ordered the entity to stop showing races from numerous venues, including Pimlico Race Course, Arlington Park, Calder Race Course, Churchill Downs, and Hollywood Park.

New York City OTB apparently was accepting signals from these tracks without board-approved contracts.

… “Not only is New York City OTB not paying the New York industry for its rights to conduct wagering, they're paying out-of-state tracks on a regular schedule,” he said. “Simply put, they are using New York horsemen, breeders, and track dollars to keep their business afloat this year. This is yet again another red flag being waived, demonstrating the corruption and misaligned intent of New York City OTB. At some point, we must have a reformed industry model in New York.”

New York City OTB spokesman Ben Branham said the financial impact of the board’s action could not immediately be assessed.

“We are in discussions with the Racing and Wagering Board to rectify the situation,” he said.

[Indulto]

This article should be read in its entirety IMO Frucher deserves to be heard without all the accompanying catcalls. That there is waste and fat is undeniable, but I think we all have to look at what he was aked to do and who he has to deal with.

http://www.thoroughbredtimes.com/national-news/2010/May/26/QA-with-New-York-City-OTB-chairman-Frucher.aspx
Q&A with New York City OTB chairman Frucher
May 26, 2010… I was asked to take over NYCOTB with the specific mandate to try and fix it. … there were two obvious issues. One was sustaining the industry and the other was not having a massive hit on the treasury of the city or the state at a time when you have a $9.5-billion budget gap at the state level.

… I was surprised at how fractionalized the industry is. And that people were rowing in different directions. There isn’t an easy way to sit down with the entire community to try and work out rational solutions. … it’s very hard to get a cohesive, rational resolution.

… Part of my mandate is to ensure that the public doesn’t get stuck with a $700-million bill in one form or another. … I believe, firmly, that NYCOTB has to stay in business, in one form or another, until you clean up the balance sheet. And when you do that, I think it’s all up for grabs. And I think the public policy makers should decide how they want to proceed with it. It all has to be done within the context of the public not holding a $700-million bag.

… The problem with the legislative process is, and was, that it’s not easy—it’s virtually impossible—for all the interests to be gathered in one place. What happens is that you have revolving doors of lobbyists all representing their clients legitimately. Except that, in that process, it’s very hard to have anybody willing to allocate any losses. It’s always, and has traditionally been, how you allocate gains. We’re now at a time when that’s simply not possible. So the question is: How do you limit the downside?

… If the industry is going to remain whole in this process without any significant losses, there has to be an infusion of revenue. … if you start cutting back simultaneously at the expense base, which is clearly what we have to do, you also start cutting back simultaneously at the revenue base. And you reach a point where the savings you get really is offset by the revenue you lose. By that, I mean, 66% of the revenue that comes into OTB comes in through the parlors. And, frankly, that’s where the bulk of your costs lie. …

… So you have not just the parlors, which are expensive in and of themselves, you have an infrastructure that is necessary to sustain the parlors. So when you start cutting the parlors, which is really where your expenses are, you’re cutting your revenue base. And remember, the statutory distribution in New York state mandates that the [racing] industry gets its distribution off the gross handle. And as a consequence there is a disproportionate outlay against the expense savings, and thus the revenue side that is distributed takes a bigger statistical hit than you get on the expense side. … The challenge here is: How do you replace the revenue that you lose when you close the parlors? That’s why we were looking for technological solutions that allow you, at a significantly lower cost basis, to harvest revenues.

… I think the Legislature, on balance, privately understands the dilemma. Obviously, the union understands the dilemma. I don’t think there are enemies who are out to scuttle you. What there are are people who have multiple constituencies who try to balance the needs of those multiple constituencies. …

… I don’t think, in the short term, the industry in New York state would be well served with any reductions. On the other hand, I don’t believe that state money can or should be used to bail out any of the parties involved—whether it’s OTB, NYRA, breeders, or any of the tracks. The question is: How do you do that? I say the way you do that is through the issuance of bonds, which is permissible under Section 611 of the OTB statute. You’d have to develop a business model that works that would allow for an investor to come in and choose to invest in OTB bonds.

… It becomes problematic politically because the industry wants to hold on with all its might to what they know and what they like, which is a statutory distribution process that distributes the dollars from the gross. And that’s not possible. It’s simply not possible to do and find any kind of outside investor who would be willing to invest in any form. Anybody who’s going to come in with any kind of venture capital or anybody who is coming in to buy your bonds is going to insist that their investment be in first position. By definition, that requires a change in the statutory distribution process.

… The industry has two arguments about why they like the gross distribution process. Number one: The industry should get paid for services it provides. I heartily agree 100%. There’s no disagreement. Where there is a disagreement is that I think that applies to all races in-state. But I don’t think people realize that two-thirds of all wagers, all the bets, that go through NYCOTB are for races outside of New York state. And that of the revenue distributed to the industry in New York state, 55% of that revenue comes from out-of-state races. …

… The second is an even more bizarre argument: Well, if you give those bums unfettered expenses to run their operations they’ll run themselves into the ground. ….. The real argument is: We get this amount of money, we’re in troubled times, and we need the money. Okay, that’s a more rational conversation than trying to justify something that from any business vantage point simply doesn’t make sense.

… I’m doing this pro bono. I’m doing this to avoid a disaster to the state. I don’t have any fat in the fire. I’m just looking at it objectively. This industry is blessed with a public policy in New York state that says, “These failed businesses, because they are failed businesses, they cannot operate on their own and make a profit on their own in New York state, need an additional public subsidy,” i.e., the awarding of franchises to run the only legal casinos in New York state, at these tracks. Now that clearly was a public policy that said, “Let’s consolidate gambling in New York state, at the tracks, for the purposes of sustaining this industry.” If it was, “Let’s have gambling to get money for the public purse, the public treasury” … then you would put them at more strategic locations like in the middle of Manhattan. So clearly, that’s designed as a subsidy for the industry. That all needs to be looked at in context.

… That is what we now are calling IATs—Internet Access Terminals. I wish we had called them that in the first instance because people really didn’t understand what a kiosk was. It led to a lot of confusion. What we’re saying is that there are already existing locations that have a culture that already incorporates wagering on sports events. It would not be out of character to have a terminal there that would allow people to place bets.

… When you look at the handle in France, for example, they have four times the wagering, per capita, that we do on horse racing through those IATs. They’ve also changed the demographic, which is one of the keys to helping. That needs to be done for the long-term viability of the racing industry, whether it’s here in New York or nationally.
The demographic here is 55 years old and older. Predominantly male. Eight percent is female. In France, the core customer group is 40 to 45, yes, male. But 42% of all the wagers [placed] is done by women. Obviously both the technology … and the familiarity [with racing and wagering] by the younger demographic who feel more comfortable in a different kind of setting. Which are essentially bars and bistros as opposed to our wagering parlors. Let me say that an OTB parlor has three functions, and then there’s a fourth dynamic. First: It’s where you place your bet. Second: where you cash out your winnings. Third: where you watch the race and socialize at the same time. Now that doesn’t have to be a parlor. It could be a bar or bistro. So you can replace the elements of it in a different setting. And at the same time start to change the demographics.

… The first objective is clearly to come up with as close to a united approach to this as possible. Two, that approach would allow us to go out and get financing to allow us to pay all of the arrearages, and to capitalize five new Super Parlors. And [that] would allow us to give early retirement and severance to our employees. And [that] would allow us to downsize significantly. Those are the objectives for this year. To get past the silliness of the name-calling, to get everybody to sit down and professionally analyze the situation. To come up with what should be a united, rational plan, and to move forward constructively in a way that would try to unite the industry as opposed to continue to divide it and fractionalize it.
The next objective would be, as an adjunct of what I’ve been talking about, to create an industry-wide public “back office utility,” so that redundant services are brought together in one place under a single management.

… Tote, Internet, telephone, marketing, [and] television. …

[Deepsix]

Thanks Indulto.... you've been birddoggin' this issue for some time and I've enjoyed reading all of your posts on the subject. That said, this article is particularly interesting... the confounding issues expressed concerning NY vary only ever so slightly from California issues.

Thanks

[Indulto]

Thanks Indulto.... you've been birddoggin' this issue for some time and I've enjoyed reading all of your posts on the subject. That said, this article is particularly interesting... the confounding issues expressed concerning NY vary only ever so slightly from California issues.

ThanksD6,
Thanks for the kind words.

As I've said before, it's the political aspect of this issue I find intriguing. This interview was not a challenging one, but Frucher used it the way a good politician should and communicated effectively. His style didn't drive home the significance of what he was saying unless I was really concentrating, so I can understand why he has been so maligned in the press.

[Deepsix]

And.... Your style of presenting the numerous links, and letting them speak 'pretty much' for themselves, instead of interjecting your personal slants/biases in some over powering agenda is appreciated by this reader. Naturally, we all have our own views and they will inevitably filter through, it seems.... BUT it appears you've made an effort to be neutral and not controversial with your personal views. Good stuff.

[Indulto]

And.... Your style of presenting the numerous links, and letting them speak 'pretty much' for themselves, instead of interjecting your personal slants/biases in some over powering agenda is appreciated by this reader. Naturally, we all have our own views and they will inevitably filter through, it seems.... BUT it appears you've made an effort to be neutral and not controversial with your personal views. Good stuff.Actually, I indicate my personal bias as to what I think is significant whenever I bold or underline a passage.

I've never been neutral, and while I haven't supported any alternative to NYRA that has been presented so far, I feel much of the criticism directed at it is deserved. While I'm grateful Hayward blew the whistle on Smith, I don't believe he was the appropriate alternative for the job. IMO the new loan should not bring an end to the cost-cutting, but rather more accountability.

I also feel too little attention has been paid to what goes on at the OTBs, and the press doesn't seem to be as motivated in reporting its "dirty little secrets" to the ame extent it has been regarding NYRA. Maybe that will change.

Winter racing AND Aqueduct should both go away. I'd always been against slots at BEL and govt. dependence on gambling to pay the salaries of its employees. However, since it's now clear that horseplayers are too far and few between -- and a slots subsidy is necessary in NY for both standandbred thoroughbred racing -- they should be at BEL, or only SAR will survive.

[Deepsix]

Yes I certainly have noticed where you choose to highlight (bold print) and that is what I referred to above regarding your personal biases. I place emphasis on my words that you don't 'overpower' your position as you've posted these topics.

At any rate, enough of this and post as you will. <smile>

[Indulto]

http://www.drf.com/news/article/113627.html (http://www.drf.com/news/article/113627.html)
New York OTB chairman submits resignation
By Matt Hegarty 6/5/2010… The resignation letter stated that Frucher did not believe his plan to reorganize New York City OTB under Chapter 9 of the bankruptcy code would be successful, according to several officials with knowledge of the matter. Frucher's plan relied on massive layoffs, the closure of more than half of the OTB's parlors, and raising $250 million through a state-backed bond issue, a measure that has become increasingly unlikely given the state's $9 billion budget deficit.

"It was all very cordial," said one of the sources, regarding the tone of the letter.

… Frucher's reorganization plan had also included the possibility of the installation of hundreds of betting machines at New York City's bars and restaurants. Critics of the plan had contended that the machines were stalking horses for video-lottery terminals, a type of slot machine that is currently restricted to New York's eight harness tracks and to Aqueduct racetrack in Queens.

New York City OTB filed for bankruptcy last December. Twice this year Frucher threatened to shutter the company's parlors and its account-wagering operation unless the legislature granted the company concessions on its statutory obligations to the racing industry, but both times he backed away from the threat, citing progress with legislators.

Since then, the New York State Racing and Wagering Board temporarily shut off the majority of Thoroughbred racing signals that OTB was offering to its customers, claiming that it had concerns over whether the company could meet its financial obligations. The signals were restored last Friday. …http://blog.timesunion.com/capitol/archives/27862/frucher-resigns-says-his-job-was-made-untenable/ (http://blog.timesunion.com/capitol/archives/27862/frucher-resigns-says-his-job-was-made-untenable/)
Frucher resigns, says his job was made untenable
by Jimmy Vielkind June 5, 2010… “In light of Mr. Megna’s letter and Mr. Sabini’s actions and their effect on the restructuring plan, I have determined that it is time for me to step aside to allow you and your staff the opportunity to resolve NYCOTB’s situation,” Frucher wrote to Paterson. “In doing so, I take pride that I have successfully completed all the task assigned to me upon my appointment: 1) evaluation and assessment of NYCOTB’s operations and financial condition; and 2) development of a sound restructuring plan that would not require taxpayer funds, treat employees with dignity and respect, will benefit the racing industry and permit it to continue as an economic engine for the State.”

The resignation took effect Friday. Frucher’s full letter is above.http://www.ny1.com/content/top_stories/119898/otb-chairman-announces-resignation (http://www.ny1.com/content/top_stories/119898/otb-chairman-announces-resignation)
OTB Chairman Announces Resignation
By: NY1 NewsOff-Track Betting's New York City Chairman Meyer "Sandy" Frucher is resigning.

… He says upon completing the assessment he, "...determined that the corporation was in fact, insolvent, and just as important that its business model was antiquated and overly labor intensive.”

Frucher said this and a financial downturn in the state's racing industry lead to a “perfect storm that not only threatened to bring down NYCOTB, but bring the demise of the entire horse racing industry in New York."

Frucher created a rescue plan that included shutting down dozens of OTB outlets and replacing them with automated betting kiosks spread out across the city, as well as downsizing the workforce by 60 to 65 percent. The plans were scratched after a number of negotiating problems with the OTB's budget director and state racing chairman.

Frucher maintains that though he's stepping down, he successfully completed all of the tasks assigned during his appointment

[Indulto]

http://www.nytimes.com/2010/06/06/nyregion/06otb.html (http://www.nytimes.com/2010/06/06/nyregion/06otb.html)
Paterson Aide to Lead OTB After Its Chairman Quits
By CATE DOTY : June 5, 2010
The top aide to Gov. David A. Paterson will lead New York City’s troubled Off-Track Betting Corporation, whose chairman resigned on the eve of the Belmont Stakes, New York’s largest racing event, officials said on Saturday.

… The administration replaced Mr. Frucher with Mr. Paterson’s top aide, Lawrence S. Schwartz, the secretary to the governor, who is known as the office’s disciplinarian. He will keep his old job while taking on his OTB duties.

Morgan Hook, the governor’s communications director, said Mr. Paterson had not asked Mr. Frucher to step down from the job, which is an unpaid position. “He thanks Sandy for his service to New York, and for the diligence and passion that he brought to the position,” Mr. Hook said on Saturday.

… Last week, Robert L. Megna, the state’s budget director, rejected Mr. Frucher’s request for nearly $300 million in tax-free municipal bonds, which would have financed his proposal to restructure OTB. …

[Indulto]

Bennett Liebman is the Executive Director of the Government Law Center at Albany Law School and a member of the board of directors of the New York Racing Association.The following article is a must read in its entirety:

http://therail.blogs.nytimes.com/2010/06/06/reasons-for-the-decline-of-horse-racing/ (http://therail.blogs.nytimes.com/2010/06/06/reasons-for-the-decline-of-horse-racing/)
Reasons for the Decline of Horse Racing
By BENNETT LIEBMAN June 6, 2010… 1. Other Forms of Gambling. Slots and casinos provide a simpler, quicker, more honest, and for most people, a more entertaining game in a better atmosphere. …

2. Traditional Individual Sports. …
… Many traditional individual sports have seen their popularity tumble since the 1950s. These sports initially thrived in the early days of TV, but have largely faded out. Think of boxing, bowling, track and field, tennis.. …

3. The Suburbanization of America. …
. As these ethnic groups moved to suburbia, they largely stopped going to the racetrack. Whatever the reason, when people left Brooklyn and Queens in the 1960s and moved to Long Island, they stopped going to the track. Pretty much the same thing happened in Los Angeles and Chicago.

4. Corruption and the Inability to Prevent It. The perception that the sport is not being conducted on a fair level has harmed racing greatly and almost destroyed the sport of harness racing. …

... with faster and more honest gambling venues now close at hand, the sport cannot tolerate corruption.

5. Drugs. The sport has not been able to prevent the use of drugs and the belief that many of the sport’s leading trainers have regularly chemically enhanced the performances of their horses. …

6. Public Perception. Numbers 4 and 5 plus the use of whips on horses and the catastrophic injuries we have seen in major races have contributed to the public perception that horse racing is a cruel sport which has little concern for the health or the safety of the horse.

7. Government Involvement. …
… Now government’s problem is that it cannot let racing or racetracks fail. It has kept racetracks in existence where there was no public interest in their races. It has forced racetracks to race far too many programs than are supported by public demand. The government seems to believe that the laws of supply and demand do not apply to horse racing.

8. Inability to Present Racing Effectively on TV. Again, it’s not that racing wasn’t on TV. It was on TV frequently regularly in the late 1940s and 1950s. The problem has been that we have never been able to show the sport to its best advantage on TV. …

9. Takeout Issues. …
…. When you hear from the major rebate shops, that without the rebate, even their most skilled players almost never beat the takeout, you wonder why you play the game.

10. Inability to Market Its Advantages. Racing does have some advantages. There’s a tremendous international interest in horse racing. It’s one of the few sports where men and women can compete equally as trainer, jockeys, and drivers. It’s the only sport with legal Internet wagering….

11. Failure to Race Horses. The average number of starts per runner in thoroughbred racing is now 6.23 per year. (It actually went up for the first time since 1992.) It was at 11.31 in 1960. How can you build stars or attract a following when horses race so infrequently?

12. Lack of a Central System for Internet or Account Wagering. …
… the lack of a central platform for account wagers makes it difficult and confusing for people to place wagers. The overall systems are simply too confusing. … Shouldn’t there be an easier way to exploit horse racing’s monopoly on legalized Internet wagering?

13. The Knowledge Base of Racing. As much as we might enjoy the art and/or skill of handicapping, the learning curve for learning how to play the horses is simply too steep. …

14. The initial 1970s OTB Experience. …
… Because of the total absence of amenities and the disreputable conditions of the parlors, horse racing in New York went from the sport of kings to the lodging place of the low lives. …

15. Management in Racing. …
… They believe that they live under a cloud much like Al Capp’s Joe Btfsplk. It has too often become a passive-aggressive world where people in racing management spend their professional lives playing the victim of the government and/or the racing gods. They have become terrific crisis managers, but not leaders.

Added New York State Issues:

1. The Breeders’ Cup. The Breeders’ Cup has destroyed any championship nature of the Belmont fall meet. ...

2. No VLT’s at Aqueduct. ...
... Given New York racing’s dependency on New York-breds, this is an extremely serious problem.

3. Winter Racing. The winter racing requirement makes little sense. Aqueduct in January does help the purse cushion for Saratoga, but it dampens whatever interest there could conceivably be for New York racing.

4. The Detention Barn. While it might have once worked to prevent milkshakes, all the detention barn does now is discourage horses from shipping to New York. Five years of an ineffective policy ought to be enough.

5. Internet Video Streaming. It may not be a major deal, but there is no reason why the races can’t be shown live on the Internet.

6. The OTB Structure. …
… NYRA received in direct and indirect payments slightly more than $3.7 million from Western OTB. That’s a return of 12.7 percent from an OTB system which is not located anywhere near any NYRA track. …

… We could get some savings by combing functions and by shared Internet service, but the savings might not be all that significant. We would get a more efficient system, but it might cost as much as the current system.

.. It is convenient but probably not accurate to blame this on the structure of the New York OTB’s.

A Nonissue: The Age of the Patrons. …
… The fact is there almost never were any young fans at the track. Horse racing is not likely to appeal to Gen Y. …

.. . There are more senior citizens in the U.S. than ever before. There will be even more in the next two decades. Racing’s problem is that they’re going to casinos and playing the lottery instead of going to the track.

Racing has never been a young person’s sport. The problem is why the baby boomers are not going to the track and what can be done to get baby boomers to go there.It seems to me that Mr. Liebman has little influence with his fellow board members.

[Indulto]

http://www.saratogian.com/articles/2010/06/23/news/doc4c216748dcbef275108423.txt
New York's racing industry weighs strategy options during Gaming Summit
By PAUL POST June 23, 2010New York’s thoroughbred tracks should stop racing year round and go to a shorter season that would generate more fan interest and boost revenues, industry leaders say.

… New York racing goes almost non-stop, more than 250 days per year. After Saratoga, the sport shifts to Belmont Park, then Aqueduct in winter followed by the spring Belmont meet before heading back to Saratoga each summer.

"New Yorkers don’t go to the track because it’s like the Empire State Building or Statue of Liberty — it’s always there," said John Sabini, state Racing and Wagering Board chairman. "The meets that are most successful are ones that have beginnings, middles and ends. If racing is not always there, you might have more interest to go. A model with a finite season works better."

… New York Racing Association’s calendar is written into its franchise agreement with the state. Changing it would require legislative action with agreement from NYRA and horsemen, whose livelihoods would be affected.

"But I don’t disagree with the concept," said Sabini, a former state senator. "I said that when I was in the Legislature. The Monmouth concept is a good one."

At present, NYRA is more concerned about getting a proposed Aqueduct Race Track racino open that will give the industry a major financial boost.

… "If your customer base is over 50 and you’re looking out 20 years, what are you looking at?" he said.

Ultimately, Gural said NYRA will have to stop racing at Aqueduct and refurbish Belmont.

"They have facilities that were built for a different era," he said. …

[Indulto]

http://sports.espn.go.com/sports/horse/columns/story?columnist=moran_paul&id=5337850 (http://sports.espn.go.com/sports/horse/columns/story?columnist=moran_paul&id=5337850)
NYRA should rethink detention
By Paul Moran June 28, 2010… Under detention-barn rules, all Lasix, now ubiquitous, is administered only by a veterinarian employed by NYRA. This could be done in a horse's stall. At the time of the establishment of sequestering, the illegal practice on "milkshaking," the pre-race administration of bicarbonate of soda and sugar with a tube, was prominent in the news and probably the inspiration for what turned out to be a mistake. Standard pre-race testing for this particular malfeasance is now conducted in almost every racing jurisdiction without imposition of unusual confinement.

Horses are held under surveillance for six hours before post time and are accompanied by a groom who expects to be paid. This is estimated to cost ...about $100 per start ...
.. It also discourages horsemen stabled outside New York from shipping to run at Aqueduct, Belmont and Saratoga even for important stakes races. Late arrival for the prescribed sentence results in a $500 fine for the trainer. Bottom line: A great deal of wasted time and money.

Few violations are known to have been thwarted within the detention-barn confines and there has been no discernable difference in the performance of horses trained by those whose success was viewed skeptically prior to its establishment. Nor has there been a reduction in the healthy skepticism widely shared by horseplayers. Meanwhile, horseplayers have seen new players inspire inexplicable form reversals, deepening suspicion despite tight security.

Considering the results, there was no cheating in New York in the first place or those cheating before the imposition of required isolation are still cheating and still not being caught. In either case, a great deal of money is being spend without apparent result, some by NYRA, which might put the funds to more useful purpose, some by owners, who resent the expense. The racing product has suffered for want of shippers, while gaming-fueled purses have grown appreciably in nearby states. The recently announced uncoupling of trainer entries in overnight races is a reaction to this but the attempt to increase the number of individual betting interests will have only minimal impact.

...the current level of post-race testing is quite sophisticated and random pre-race testing is a perfectly acceptable alternative to mandatory incarceration, which has often resulted in horses, particularly the young and inexperienced, reacting badly to changes of routine and surroundings. Alternatives to the detention barn abound, which does much to explain why there has been no rush by other racing associations to emulate NYRA's questionably effective security requirement.

… Officials claim to have been considering the elimination of the detention barn since last winter. That's a long time to be puzzling over a no-brainer.

[Indulto]

http://www.drf.com/news/article/114541.html
New York OTB president resigns
By David Grening 7/7/2010Ray Casey resigned as president of the bankrupt New York City Off-Track Betting Corp. on Wednesday, and was replaced by Greg Rayburn.

Rayburn was a former chief executive officer for Frank Stronach's Magna Entertainment Corp. when that company was in bankruptcy. New York City OTB has been in Chapter 9 bankruptcy since December.

Larry Schwartz, who was recently appointed by New York Gov. David Paterson as chairman of NYC OTB - replacing Sandy Frucher, who resigned - announced the change at the company's monthly board meeting.

"I do believe that the person that we've selected is going to be the solution for the health and future success of this corporation," Schwartz said at the meeting, according to a New York Post blog item. "This corporation has spent nearly $2 million in the last year on outside consultants and has very little to show for it." …http://www.thoroughbredtimes.com/national-news/2010/July/07/New-CEO-takes-over-at-NYC-OTB.aspx (http://www.thoroughbredtimes.com/national-news/2010/July/07/New-CEO-takes-over-at-NYC-OTB.aspx)
$1.5-million/year CEO takes over at NYC OTB
by Paul PostJuly 07, 2010… “There’s certainly some concerns about the amount of money, when OTB isn’t paying NYRA $2-million per month and breeders $200,000 per month,” said Rick Violette, New York Thoroughbred Horsemen’s Association president. “But if he can come in and quickly downsize and restructure OTB, then he probably couldn’t be paid enough. People who have been there haven’t been producing. They still haven’t closed one betting shop.”

… Assembly racing committee Chairman Gary Pretlow (D-Yonkers) said Rayburn’s salary is not justifiable no matter how good a job he does.

“I’m incensed,” he said “I can’t think of an adjective superlative enough to describe $125,000 a month to run OTB. It’s ludicrous to be paying someone that exorbitant a salary. I can’t imagine what he could be doing to earn that. It’s the absolute wrong signal to be sending.”

Schwartz, a top aide to Gov. David Paterson, recently replaced Meyer Frucher as OTB board chairman. The five-member OTB board is comprised of three gubernatorial appointees, and one each from the senate and assembly.

Assembly appointee Steven Newman cast the lone dissenting vote against Rayburn’s hiring, citing his salary and alleged lack of experience dealing in the government and political spectrum.http://www.drf.com/news/article/114535.html
Two out of three Aqueduct bids disqualified
By David Grening 7/7/2010… Genting New York, a wholly-owned subsidiary of Genting Malaysia, one of Asia's largest casino operators, is the only group still in the running to operate Aqueduct's casino after the State Lottery disqualified Penn National Gaming and the consortium of SL Green, Hard Rock International, and Clairvest Group for attempting to negotiate for terms that were more favorable to them.

According to a press release issued by the State Lottery, both SL Green and Penn National failed to sign a Memorandum of Understanding and other documents the lottery requested by the June 29 deadline to submit bids. Also, the bids by both groups contained several alterations to the memorandum, which were not allowed.

:: MORE: Full statement from the New York Lottery (http://readme.readmedia.com/NY-Lottery-Disqualifies-Two-Bidders-for-Non-Conforming-Proposals-to-Develop-Aqueduct/1577971)

SL Green did not agree to provide interim financing to support New York Racing Association operations until the opening of the casino. SL Green's bid also sought the ability to make repairs or alterations to Aqueduct without the consent of the state or NYRA, and then bill the state or NYRA for the cost of those repairs or alterations.

Penn National's bid did not agree to advance funds to NYRA if construction of the Aqueduct casino is delayed by more than 30 days. Penn National also sought a six-month acceleration of NYRA's loan repayment obligations by eliminating the waiting period already agreed to by the state and NYRA.

Under terms of the casino financing, the winning bidder is required to take over the $25 million loan the state recently gave to NYRA as well as supply up to an additional $2 million a month in financing to the association until the casino is open.

According to the State Lottery, Genting New York's proposal appears to conform with all requirements of the bidding process. …

[Indulto]

http://www.nydailynews.com/ny_local/2010/07/08/2010-07-08_big_bucks_to_fix_otb_debt_critics_wail_as_new_b oss_makes_125000mo.html
Bankrupt NYC Off Track Betting names Greg Rayburn new CEO as critics blast $125,000 per month salary
By Kenneth Lovett and Barbara Ross July 8th 2010… OTB directors also agreed to give Schwartz total control over hiring and firing for as long as he remains chairman.

The lone opponent to the two moves among OTB's five directors was Steven Newman (http://www.nydailynews.com/topics/Steven+Newman), an appointee of Assembly Speaker Sheldon Silver (http://www.nydailynews.com/topics/Sheldon+Silver).

"We're about to pay out four times as much as we've paid any consultant we've been criticized for hiring, and 10 times as much as the prior CEO," he said.

Schwartz defended the moves, saying it was a "mischaracterization" to say OTB overpaid for Rayburn's services.

… Schwartz defended Rayburn's salary, saying he was hired on a month-by-month basis and he should be on the job for only "three or four months."

Schwartz called it "fiction" to think OTB "could hire someone for $150,000 a year" to help it successfully restructure and become solvent.

... Schwartz's move was a slap at his predecessor, Meyer Frucher, who resigned last month after failing to get the Legislature's support for a bailout.

Schwartz told board members Rayburn was picked for his experience in restructuring other racing industry firms. …http://www.paulickreport.com/blog/nyc-otb-president-casey-resigns-replacement-reportedly-making-125000-a-month/ (http://www.paulickreport.com/blog/nyc-otb-president-casey-resigns-replacement-reportedly-making-125000-a-month/)
UPDATE: The following press release was just sent out by the NYC OTB… Mr. Rayburn’s appointment, which does not require the approval of the bankruptcy Court, began immediately.

A seasoned expert in corporate restructuring, Mr. Rayburn brings with him 28 years of experience. He has specialized in restructurings involving corporations in bankruptcy; most recently finalizing in April 2010 the successful reorganization of Magna Entertainment Corp., North America’s largest owner and operator of horse racetracks. Magna also runs off-track betting facilities, as well XpressBet a national account wagering business.

“Mr. Rayburn’s very specialized experience made him uniquely suited for the task, and we are pleased that he can begin working immediately,” added Chairman Schwartz.

… NYCOTB Board member Anthony Bergamo said: “The nature of the crisis demands a short engagement and fast results. We feel confident that Mr. Rayburn has the experience, talent and reputation to deliver a timely reorganization plan that NYCOTB’s Board of Directors, its creditors and the Court will accept.”

Mr. Rayburn comes with the support of major creditors of NYCOTB, who are owed nearly $100 million in total liabilities. As is typical with a bankruptcy restructuring, Mr. Rayburn’s compensation is effectively being paid by the creditors, who would be due some portion of NYCOTB’s assets in the event of a liquidation. A successful restructuring will bring with it relief from outstanding liabilities, and will also protect the City of New York from inheriting nearly $700 million in pension and health legacy payments.

C. Steven Duncker, New York Racing Association (NYRA) Chairman, said: “As its largest creditor, the New York Racing Association, Inc. fully supports the appointment of Greg Rayburn as the new CEO of the New York City Off-Track Betting Corporation. His extensive experience of improving the operations of troubled companies across a range of industries gives us confidence that he will implement a viable plan of reorganization for NYC OTB that is mutually beneficial for the State of New York and the thoroughbred racing industry.”Assemblyman Pretlow may regret his quoted reactions, but they are perfectly understandable given the lack of legislative support for his own seemingly reasonable proposal for cutting the costs of the NYCOTB operation as an alternative to Frucher’s plan.

Governor Paterson has nothing to lose here and, considering that Stronach got away with voiding both Oak Tree’s lease and the DeFrancis slots deal through the MEC bankruptcy, maybe Rayburn is the real deal for OTB. On the other hand, it might also lead to Duncker’s eating his words too.

[Indulto]

http://www.nydailynews.com/opinions/2010/07/10/2010-07-10_on_the_wrong_track.html (http://www.nydailynews.com/opinions/2010/07/10/2010-07-10_on_the_wrong_track.html)
On the wrong track: OTB can't be fixed unless horse racing is repaired too
Editorial 07/10/2010… With due respect to Rayburn's respectable bona fides, neither he nor any other CEO can fix what ails this money-losing gambling outfit on his own.

That's because horse racing in New York State, its fan base deeply depleted, has been limping along for decades.

… New York must undertake wholesale reevaluation of its relationship to the industry - putting dying tracks and OTB parlors out of their misery, giving viable facilities a chance to thrive and, above all, taking taxpayer support out of the equation.

… OTB is just one part of a broken system. It's going broke because it's forced to share too much of its dwindling revenue with harness and thoroughbred tracks, most of which are going broke too. Neither Paterson nor anyone else in Albany wants to face that reality, even as their ill-conceived short-term fixes crash and burn.

The cockamamie plan to install video slots at sad-sack Aqueduct is a perfect example. It would outrageously divert lottery money intended for schools, to subsidize racing. It would pointlessly prop up a track nobody attends that's just 8 miles from far more successful Belmont. It would waste valuable land. And the state's efforts to pick a developer have been a complete botch.

The latest attempt is falling apart basically because two of the three bidders wouldn't trust the state to keep its promises - and who would, after three failed rounds of bidding in nine years?

… Now, Paterson wants us to believe Rayburn, in three or four months, will do what Frucher could not. Even though he's the appointee of a lame-duck governor. Even though he has no authority to force the big-picture reform that's desperately needed - and without which piecemeal fixes are doomed to fail. Talk about longshots.http://www.bloodhorse.com/horse-racing/articles/57862/report-nyra-could-be-insolvent-by-2011 (http://www.bloodhorse.com/horse-racing/articles/57862/report-nyra-could-be-insolvent-by-2011)
Report: NYRA Could be Insolvent by 2011
By Blood-Horse Staff July 12, 2010… New York state comptroller Thomas P. DiNapoli took the New York Racing Association to task for failing to rein in spending after going into bankruptcy and says the organization faces insolvency by 2011 if revenues from a proposed racino fail to materialize and expenses are not curtailed.

… While the comptroller criticized NYRA for its inability to bring spending under control, he acknowledged that some of the racetrack operator’s financial problems and future outlook are related to the inability of the state to select a franchise to operate video lottery terminals at the Aqueduct racino. The auditors concluded NYRA would not have been able to continue operations past early June of this year were it not for a $25 million loan approved by the legislature.

"The state also has to live up to its end of the deal," DiNapoli said. "But it looks like the selection of a VLT operator for Aqueduct is still an open question. When you start with six potential bidders and end up with only one, it begs the question of how the process was handled and whether the state can actually close the deal. The fact is NYRA can’t make it long without significant restructuring and revenues from VLTs."

… In a July 2 letter to DiNapoli’s office, NYRA president and CEO Charles Hayward challenged some conclusions in the audit and agreed with the report’s conclusion that NYRA’s financial stability had been threatened by its inability to receive anticipated VLT revenues and NYCOTB’s default on its payments.

… "By actively managing expenses, NYRA successfully operated for almost two years without the required VLT financing or financial support from the state of New York," Hayward wrote. "NYRA management has demonstrated a willingness to reduce operating expenses where feasible and will continue to explore further opportunities to reduce costs and improve the efficiency of its operations."

NYRA also sent the comptroller’s office a letter from James P. Heffernan, NYRA’s board vice chairman and chairman of the Special Oversight Committee.

…

New York Comptroller Report on NYRA (http://www.bloodhorse.com/pdf/09s89.pdf)

NYRA’s Response to Audit Report (http://www.bloodhorse.com/pdf/20100712093849.pdf)
http://blog.timesunion.com/saratogaseen/odds-hardly-in-nyras-favor/5680/
Odds hardly in NYRA’s favor
by Christen Gowan July 13, 2010… With 10 days to go before the kickoff of the Saratoga meet, a new audit from state Comptroller Thomas DiNapoli suggests the New York Racing Association faces insolvency next year unless major changes are made.

… With the stakes that high, DiNapoli will deploy auditors to monitor NYRA’s downstate headquarters at Aqueduct, in order to advise the organization on cost-cutting and to provide what he described as a “real-time” picture of the organization’s finances.

… “NYRA was given a second chance to get it right. Unfortunately, as our audit today reveals, NYRA didn’t get it right,” said DiNapoli, whose report detailed what he said was a litany of missteps — from increasing its payroll to approving hard-to-justify expenses such as $6 million on “personal and miscellaneous” services.

… The Comptroller’s report also alludes to a move which insiders say is not certain to happen: the closure of the detention barn, where horses are kept prior to racing as a guard against doping. That would save money and resolve a complaint of horse owners, who believe the use of the barn harms the horses’ performance.http://sports.espn.go.com/sports/horse/columns/story?columnist=moran_paul&id=537430 (http://sports.espn.go.com/sports/horse/columns/story?columnist=moran_paul&id=537430)
Saratoga stretches out
By Paul Moran July 12, 2010… Less has become significantly more at Monmouth Park in New Jersey, the first state to deal intelligently with an industry in decline.

… at Saratoga, the wounded economy and stark reality be damned -- "more than ever" is the theme of 2010.

The NYRA will stage 40 days of racing at the Spa, beginning on July 23 and concluding on Labor Day. The 24-day meeting during an era when the NYRA billed Saratoga as "the August place to be" is but a fond memory more than two decades gone. The four-week meeting became five, then six, and now is just short of seven -- six days a week with 10 races on most days.

There is a tipping point out there somewhere if not a point of no return. Once an aura is blemished, it is stained indelibly. Tamper at great peril with the exclusivity of Saratoga, and the perception that winning here is something to be savored beyond winning almost anywhere else. ...

... An elite population of horses and a high level of competition became unsustainable some time ago. When this meeting was at its best, the lowest level of claiming race was $25,000, and no selling race was offered for state-breds or maidens.

… In recent years, the condition book in New York has become a laughable squandering of paper. A daily supply of "extra" races -- dozens per week -- is the basis of assembling the daily racing cards. That practice is most egregious during the Saratoga meeting, when pressure to produce large fields is increased exponentially. The result: an inordinate number of turf sprints for low-level horses and the dilution of the overall product to a shadow of what was once the standard of excellence.

… There is more at work here than an extra four days of racing and the questionable timing of expansion in the face of a diminished horse population and increased competition. Never has what is widely considered the pre-eminent race meeting in North America faced so many uncertainties at a time when pleasant surprises and serendipitous outcomes are few and far between. …

[Indulto]

http://sports.espn.go.com/sports/horse/news/story?id=5380562
NYRA eliminates detention barn
By Matt HegartyJuly 14, 2010The New York Racing Association announced Wednesday that it has scrapped a 5-year-old policy that required horses to be isolated in a security barn six hours prior to running in any race at a NYRA track, effective with the start of the Saratoga meet on July 23.

The decision to abandon the policy comes one week after horsemen threatened to boycott the entry box following earlier unsuccessful attempts to convince NYRA to eliminate the barn. Some horsemen have said that the barn disrupts their operations, creates a stressful pre-race environment for horses, and adds to raceday expenses.

… Rick Violette, president of the New York Thoroughbred Horsemen's Association, said that the new testing procedures and NYRA's plan to have security personnel monitor horses who have been entered to race creates a "better mousetrap" for backstretch security.

"It'll be more horse-friendly without sacrificing the highest level of integrity in the business," Violette said.

With the elimination of the barn, private veterinarians will once again be able to administer the legal raceday diuretic Lasix to horses. NYRA said that it will closely monitor those administrations and that it will test horses for milkshakes prior to races at an assembly point located near the saddling area at its racetracks. Milkshakes are concoctions of baking soda and other ingredients intended to improve a horse's stamina. They are typically administered within several hours of a race.http://www.saratogian.com/articles/2010/07/14/news/doc4c3dfd6e12723266979614.txt (http://www.saratogian.com/articles/2010/07/14/news/doc4c3dfd6e12723266979614.txt)
Court order halts VLT bid process, heightens risk to NYRA's financial state
By PAUL POST July 14, 2010The firm chosen to run Aqueduct Race Track’s racino earlier this year, and later disqualified, has won a court order bringing the latest selection process to a halt.

The move threatens to delay naming of a gaming operator indefinitely, which could spell financial disaster for New York Racing Association. …

… Justice Barry D. Kramer issued a temporary restraining order on Monday, stopping the state Lottery Division from conducting its review of one remaining bidder – Genting New York LLC – until a July 23 hearing is held. Papers were expected to be served today, but spokesperson Jennifer Givner said Lottery hadn’t received them by early afternoon.

… “We want what AEG originally set out to do – get the contract,” said Latif Doman, the firm’s attorney. “We want to be back in the licensing process so we can complete the process.”

… But Lottery insisted on reviewing their financials, because of a stipulation by Assembly Speaker Sheldon Silver, D-Manhattan, that all investors be vetted, no matter how large or small their involvement. When Flake and Jay Z refused, AEG was disqualified and the bidding process was started over.

… AEG has sued Lottery, Silver, Paterson and other state leaders. Their primary objection is that Silver changed the rules of the game in midstream, by requiring even minor investors to reveal their financial information.

“We’ve already been selected,” Doman said. “Just complete the process.” … http://www.timesunion.com/AspStories/story.asp?storyID=950471&category=OPINION (http://www.timesunion.com/AspStories/story.asp?storyID=950471&category=OPINION)
Last warning for NYRA, state
EDITORIAL July 14, 2010 … NYRA has to stop spending so much, concludes Comptroller Thomas DiNapoli's audit. The 2.2 percent reduction NYRA made in its operating expenses between coming out of bankruptcy in late 2008 and the beginning of 2010 isn't enough -- not when betting on racing is in such steady decline, in both New York (down 13.2 percent from 2006 to 2009) and across the country (down 16.7 percent during the same period).

NYRA's payroll, meanwhile, is slightly higher than it was when it came out of bankruptcy. Its top seven executives make a total of $2.4 million a year. The audit released Monday also questions the necessity of some of the more than $6 million NYRA spent on contracts for personal and miscellaneous services. That hardly smacks of austerity. …http://cs.bloodhorse.com/blogs/finalturn/archive/2010/07/13/new-york-s-three-legged-stool-has-collapsed-by-dick-downey.aspx (http://cs.bloodhorse.com/blogs/finalturn/archive/2010/07/13/new-york-s-three-legged-stool-has-collapsed-by-dick-downey.aspx)
New York's Three-Legged Stool Has Collapsed
By Dick Downey 13 Jul 2010 …It’s time to throw out this old, broken stool. It’s time for well-run, publicly-listed businesses to be allowed the opportunity to buy these tracks. There have been several racetrack acquisitions made in the last few years, some of them after the economy began backtracking in 2008. But first, the State of New York has to allow NYRA to default on its 25-year lease, which would free up the state to sell the track properties.

Even if doing that means state government would again delay millions in prospective VLT tax revenue, it’s revenue that its politicians have done almost nothing to generate for nine years now. I’d give odds that a private enterprise, particularly a company with gaming operations experience, would make up the difference for the extra time lost.

As for NYCOTB, the new man in its top spot is embroiled in controversy over his hiring and his salary. What a joke. Put NYCOTB up for sale, too, and get the government of New York, which has no clue about fiscal responsibility—not to mention ethical conduct—out of the racing business.

[rwwupl]

Indulto...

You are right about the Liebman article...a must read. His entire piece has been sent to Mr. Dennis Mills for his: http://www.racingfuture.com/viewpoints.html

and the CHRB and many other leaders.

Mr. Liebman is a resource and has much good advice.

P.S.... I think he reads a lot...even PaceAdvantage

excerpt...

A Nonissue: The Age of the Patrons. …
… The fact is there almost never were any young fans at the track. Horse racing is not likely to appeal to Gen Y. …

.. . There are more senior citizens in the U.S. than ever before. There will be even more in the next two decades. Racing’s problem is that they’re going to casinos and playing the lottery instead of going to the track.

Racing has never been a young person’s sport. The problem is why the baby boomers are not going to the track and what can be done to get baby boomers to go there.
It seems to me that Mr. Liebman has little influence with his fellow board members.



rwwupl

[OTM Al]

In case anyone would actually like to read a real assessment of the actions of the New York political hack known as Tom DiNapoli, this sums it up well

http://leftatthegate.blogspot.com/2010/07/comptrollers-report-not-worth-paper-its.html

[Vinman]

By suing and stopping the proceedings, Aqueduct Entertainment Group may be doing all parties in this entire "wacko" Aqueduct Racino bidding process a favor, except of course NYRA and all other parties which stand to benefit from the eventual slots revenue stream. Their "favor" is to delay, yet again, the awarding of the AQU Racino gig long enough so that the new Governor, presumably, but almost inevitably Mr. Cuomo, will be able to wipe the Aqueduct Racino bidding slate clean and start over, attracting a flock of new bids from the the best casino companies in the business.

IMHO, selecting the right company, ie. a US based one with a wealth of Racino experience in the US, is more important than keeping the proverbial pedal to the floor in a panic mode for the sake of getting the Racino built a few months quicker, with perhaps a less than rock solid outfit at the controls. Reading that dancing girls and a massive Chinese restaurant are what the lone bidder left standing is initially talking about providing, even before being officially selected, probably has Steve Wynn and every other casino operator from coast to coast grinning from ear to ear that they still have a shot to win this gig.

Bet on this....the company or group of companies that gets to build the Racino at Aqueduct will be a US based one that hasn't been selected yet. Sorry AEG, but ya did us proud by stopping the train long enough for Andy to board.

Vinman

[Indulto]

In case anyone would actually like to read a real assessment of the actions of the New York political hack known as Tom DiNapoli, this sums it up well

http://leftatthegate.blogspot.com/2010/07/comptrollers-report-not-worth-paper-its.html
OA,
IMO the LATG blog is one of the best sources of opinion and analysis regarding New York racing. I wish the blogger were able to conduct interviews with other participants besides Hayward. Since most of his work is based on news articles, I try to read them independently to see what strikes me as significant, and draw my own conclusions before I read his interpretation. I occasionally include his opinions, but too often I feel like it would be summarizing a summary.

How is it that so many political hacks seem to line up against NYRA, anyway?

When the DRF starts slamming NYRA’s racing product, you know something’s up:

http://www1.drf.com/drfNewsArticle.do?NID=114767
Faster horses migrating from New York to Monmouth
By Dick Jerardi 7/14/2010… The Beyers clearly show that Monmouth is getting faster (and better) horses at this meet than it got over the same period last year. And that is affecting the quality of the horses running at Belmont Park.

… During the first six weeks of last year's meet, older males in maiden special weight races on the main track at Monmouth averaged an 83 Beyer. This year, it is 91. Last year, $5,000 claimers averaged 72. This year, it is 77. Conditional claimers running for $5,000 averaged 63 then and 73 now. It is not so stark at every level, but the data is pretty clear.

Turf races are no different. Last year, first-level allowance races for older males averaged an 84 Beyer. This year, horses at that level are averaging a 91 Beyer.

These are not the same horses running for more money. These are better horses running for more money.

… At Belmont, during the first six weeks of the Monmouth meeting, first-level allowance races for older males are down from an average of 100 to 97. That is still better than Monmouth, but the gap is narrowing. It was 11 points last year, just 4 points this year. Races for $7,500 claimers at Belmont are down from 80 to 72.

"The one thing we've been seeing for the last three years is the deterioration of New York racing," Hopkins said. "The slippery slope is even getting steeper ... With the purse structure at Monmouth, what you would expect would happen has happened. They're getting all the good horses in the allowance classes and in maiden races. When you get to the claiming races where the purses are ridiculously high at Monmouth, you see the same thing."

... "How can you pick up the phone and talk to an owner and say. 'I think we ought to run at Belmont, where the purse is $50,000, as opposed to Monmouth, where it's $85,000?' " Hopkins said.

… "The turnaround is really dramatic," Hopkins said.

Knowing the past data probably would be irrelevant at Monmouth, Hopkins erased the Monmouth pars from the Beyer system when the meet began so he could just look at the races in relation to each other and not past years.

… Jersey-breds are still Jersey-breds. There isn't a ton of data yet, but it appears they have not gotten any faster even though they are running for so much more money. ...VM,
Funny take on the AEG suit, but the state should make it moot by closing AQU and authorizing VLTs at BEL where all the big players wanted to install them in the first place. I was against slots at both BEL and AQU, but slots shouldn’t keep AQU open while NY racing tanks.

[Indulto]

Indulto...

You are right about the Liebman article...a must read. His entire piece has been sent to Mr. Dennis Mills for his: http://www.racingfuture.com/viewpoints.html

and the CHRB and many other leaders.

Mr. Liebman is a resource and has much good advice.

P.S.... I think he reads a lot...even PaceAdvantage

excerpt...

rwwuplrw,
Liebman is on the NYRA Board, but he doesn't seem to have much influence. Maybe OA or tlg could tell us why. I doubt Mr. Liebman will have much influence with Mr. Mills. Paulick's "interview" with Mills suggests the former doesn't either.

[Vinman]

VM,Funny take on the AEG suit, but the state should make it moot by closing AQU and authorizing VLTs at BEL where all the big players wanted to install them in the first place. I was against slots at both BEL and AQU, but slots shouldn’t keep AQU open while NY racing tanks.[/QUOTE]



John...I agree that Belmont would be a much better venue to build a Racino and would indeed attract more proposals from the high end gaming outfits. Perhaps the only "extra" that AQU might offer is free shuttle service for the JFK "layover crowd".....LOL!

[OTM Al]

How is it so many hacks line up? That should be pretty obvious. Easy target to make it look like you are doing something so you can get reelected. Why is it every news article called the money NYRA got from the State a bailout when the State essentially already owed them that money? Given DiNapoli's record he probably read that in the paper and figured he could score points with the public because of an incorrect assertion.

I'll also take issue with your assessment that Jerardi is "slamming" NYRA in the DRF. Looks to me he is simply stating facts except for the statement you've bolded, which is someone else's statement anyway. That I would not call a lie but a misrepresentation. Everybody's product has been on a downswing the last 3 years, not just New York's. Monmouth's actions are certainly great for the player in the short term, but I'll hold my judgement on how great it is for racing in the long term until I see what they are doing next year. I personally am quite concerned about their long term survival, but hey, isn't short term thinking what our politicians are all about?

[Indulto]

How is it so many hacks line up? That should be pretty obvious. Easy target to make it look like you are doing something so you can get reelected. Why is it every news article called the money NYRA got from the State a bailout when the State essentially already owed them that money? Given DiNapoli's record he probably read that in the paper and figured he could score points with the public because of an incorrect assertion.

I'll also take issue with your assessment that Jerardi is "slamming" NYRA in the DRF. Looks to me he is simply stating facts except for the statement you've bolded, which is someone else's statement anyway. That I would not call a lie but a misrepresentation. Everybody's product has been on a downswing the last 3 years, not just New York's. Monmouth's actions are certainly great for the player in the short term, but I'll hold my judgement on how great it is for racing in the long term until I see what they are doing next year. I personally am quite concerned about their long term survival, but hey, isn't short term thinking what our politicians are all about?OA,
you cover ground like as tenaciously as a defensive linebacker. ;) When the DRF starts slamming NYRA’s racing product, you know something’s up:It struck me as humorous that not only is NYRA taking pot shots, but so are the horses that run there. The DRF is undeniably NYRA's greatest supporter in the press, so for them to publish anything negative from anybody is noteworthy. You also have to understand that I take any attempt from any single source of speed figures to establish anything other than whether an individual horse is improving or declining as self-aggrandizing.

VM,
I've never been a John in name or deed, but perhaos you've made that association since I do comment frequently at John Pricci's blog, and I did request a copy of your Pick Five payoff analysis that he referenced. :ThmbUp:

[OTM Al]

You also have to understand that I take any attempt from any single source of speed figures to establish anything other than whether an individual horse is improving or declining as self-aggrandizing.



This not exactly my point of questioning the article but close. Don't know over how many races this figue is based on. One cannot be sure while all the noted race types have trended higher that they have reached a level of statistical significance. Of course having more horses in the race would also have an effect....

I have no doubt though that in certain race types there has been an improvement in quality, but then again, they had latitude for improvement. Unfortunately the very top end, their stake program, has pretty much stayed the same, but then it wasn't that strong to start with so that should be expected.

[Indulto]

We’ll have to establish some type of power ratings for politicians who get on their high horses so that the next time Mr. Di Napoli does so, we can determine how hard he is running for re-election. :D

NYRA’s persistent lack of transparency will always give politicians like Di Napoli room to maneuver, but Di Napoli himself is vulnerable because he was not elected directly by the voters. Rather he was chosen by his legislative peers to replace Mr. Hevesi in an effort to subvert the then Governor’s agenda. He will have some task in distancing himself from all the dysfunction and corruption that kept VLTs from being implemented before he became Comptroller, which adversely affected the State's economic fortunes as well as those of racing.

IMO NYRA could have avoided most of the bailout characterizations by straightforwardly identifying the provision in the agreement that proved the State was obligated to pay them. Instead they tried to apply pressure indirectly by whining about potential meet closings; perhaps in fear of having to release salary figures. Both Di Napoli and NYRA management will have to stew in their own juices.

[OTM Al]

Instead they tried to apply pressure indirectly by whining about potential meet closings; perhaps in fear of having to release salary figures. Both Di Napoli and NYRA management will have to stew in their own juices.

I can tell you that wasn't whining and it wasn't a maneuver. It looked bad because it came on the heels of the NYCOTB threat to close and then announcing they could continue on for at least another year. But it was very very real. The salary figure nonsense was just another deflection by the politicos. Those salaries are run of the mill in NYC for exceutive jobs of that size.

[Indulto]

I can tell you that wasn't whining and it wasn't a maneuver. It looked bad because it came on the heels of the NYCOTB threat to close and then announcing they could continue on for at least another year. But it was very very real. The salary figure nonsense was just another deflection by the politicos. Those salaries are run of the mill in NYC for exceutive jobs of that size.I seeem to recall the NYCOTB whining (and subsequent threats) starting well after NYRA's whining permeated the press. Frucher's (actually Paterson's) copycat strategy that morphed into a bluff was obviously crying wolf, but it has little bearing on the current negative perceptions of NYRA, especially since now everybody knows that NYCOTB (Paterson/State) was the short-term cause of NYRA's financial difficulties.

If the salary issue was "nonsense," what prompted the position cuts that ensued? Salary comparisons within industry or region are only meaningful when times are good for everybody. What has Hayward actually been doing that Duncker and Schwartz didn't do better for next to nothing when called upon by circumstances? What value does Hayward add as CEO over what he "contributed" as a board member?

[OTM Al]

What does a CEO do? It's a classic question. One often asked by those who think they are worth more than they earn. This thread used to serve a point. You used to post the news in a good consolidated form. Well, keep up the work I guess. You should have plenty of fodder to go for years. Yet another way has been found to stop the slots at Aqueduct and it looks like Andrew Cuomo will be governor and if he follows in his father's footsteps, nothing good will come of racing in NY. Have fun. I'm out.

[slewis]

While you guys squibble about what a CEO does and what his compensation should be, I'll set part of this record straight.

First off, this is a GAMBLING enterprise...(although I'd bet if someone asks Haywood what he does for a living he'd them he's in the horse racing business).

Now I've made this point before but for OTM Al..(my friend) PA..and the rest of the NYRA lovers, I'll make it again:

If I could legally set up a craps table on any corner of midtown Manhattan between the hours 11Am and 3pm each day, and hired 5 twelve year olds to run it (taking out security issues for the sake of the arguement) I GUARANTEE, GUARANTEE...GUARANTEE (can I drive my point home?)...that the kids will rake in many millions in profits per month...

My point being that gambling operations are cash cows...and there isn't enough managing to do to substantiate the money Haywood, Handel and other executives are making...

I GUARANTEE (again)... that if this were a privately owned business or a publicly traded company where the board has to answer to SOMEONE (unlike NYRA who answers to NO one)....

I GUARANTEE Haywood would be making half of what he makes now and Handel would be gone...that is..


unless, these two bozos actually DID something to actually set the sport in NY in the right direction.
Has NYRA even attempted to draw new and younger people into the game since this group has taken over?

Have they outlined a plan for the short/medium term?

The answer is NO... Everything revolves around the VLT's.... Which amounts to just welfare for the industry.

Oh, and for those that want to call bailout money, "deserved payments"..let me remind you that it was NYRA's bad behavior that forced a judge to have Getnick oversee this (still exists today) operation as part of the court proceedings.

So tell me Al..and others..who pays Getnick, uh?

Duncker?... Heffernan?...Phipps...Janney??

Who's pockets flip the bill for this governmental cherade?

Do you think the millions G & G get and other wasteful expenses wouldn't be better used to run racing the way it should be run?

Let's not dare try and suggest that the taxpayers aren't taking it on the chin here.

N-Y-R-A........Not-for-profit, just for our own little fun and games.

[Tom]

In case anyone would actually like to read a real assessment of the actions of the New York political hack known as Tom DiNapoli, this sums it up well

http://leftatthegate.blogspot.com/2010/07/comptrollers-report-not-worth-paper-its.html

The guy is an idiot, plain and simple. He has no clue what is going on.
He caused another "Byk-fit" yesterday! :eek::D

How does NY get all these total loonies?

[Indulto]

What does a CEO do? It's a classic question. One often asked by those who think they are worth more than they earn. This thread used to serve a point. You used to post the news in a good consolidated form. Well, keep up the work I guess. You should have plenty of fodder to go for years. Yet another way has been found to stop the slots at Aqueduct and it looks like Andrew Cuomo will be governor and if he follows in his father's footsteps, nothing good will come of racing in NY. Have fun. I'm out.I'm sorry you've decided to opt out. I hope you'll reconsider when ypu're feeling less put upon because I've always found you to be a voice of reason, paticularly where little exists. I know you're striving to offset what to you appears to be unfair criticism toward NYRA at a time when many have lost confidence in its capacity to continue conducting racing at the highest level in the nation.

I too want to see New York Racing remain the leader. I still believe a not-for-profit structure like NYRA's is peferable to that which would have been implemented by the other racing franchise bidders, but it depends on modern-thinking, cost and customer-sensitive executives to succeed. It really doesn't matter any more who may have been at fault. There is too much blame to distribute fairly. It's obviously time for some fresh blood on the board and at the highest staff levels.

NYRA has to work with other tracks/associations to allow all to realize a higher net from off-track wagers on their product while also broadening its customer base nationwide. There can't be any more excuses. If they're honestly trying to reduce takeout and lower exotic wager minimums, they've got to be transparent about why they are not being allowed to compete and who is actually preventing them from doing so. If they can't get it done, they have to find others who can.

The "Old Boys Club" can only be tolerated when they don't screw up the works. Their inability to get the Breeder's Cup speaks voumes since some BC execs are "Club" members as well.

[miesque]

While you guys squibble about what a CEO does and what his compensation should be, I'll set part of this record straight.

First off, this is a GAMBLING enterprise...(although I'd bet if someone asks Haywood what he does for a living he'd them he's in the horse racing business).

Now I've made this point before but for OTM Al..(my friend) PA..and the rest of the NYRA lovers, I'll make it again:

If I could legally set up a craps table on any corner of midtown Manhattan between the hours 11Am and 3pm each day, and hired 5 twelve year olds to run it (taking out security issues for the sake of the arguement) I GUARANTEE, GUARANTEE...GUARANTEE (can I drive my point home?)...that the kids will rake in many millions in profits per month...

My point being that gambling operations are cash cows...and there isn't enough managing to do to substantiate the money Haywood, Handel and other executives are making...

I GUARANTEE (again)... that if this were a privately owned business or a publicly traded company where the board has to answer to SOMEONE (unlike NYRA who answers to NO one)....

I GUARANTEE Haywood would be making half of what he makes now and Handel would be gone...that is..


unless, these two bozos actually DID something to actually set the sport in NY in the right direction.
Has NYRA even attempted to draw new and younger people into the game since this group has taken over?

Have they outlined a plan for the short/medium term?

The answer is NO... Everything revolves around the VLT's.... Which amounts to just welfare for the industry.

Oh, and for those that want to call bailout money, "deserved payments"..let me remind you that it was NYRA's bad behavior that forced a judge to have Getnick oversee this (still exists today) operation as part of the court proceedings.

So tell me Al..and others..who pays Getnick, uh?

Duncker?... Heffernan?...Phipps...Janney??

Who's pockets flip the bill for this governmental cherade?

Do you think the millions G & G get and other wasteful expenses wouldn't be better used to run racing the way it should be run?

Let's not dare try and suggest that the taxpayers aren't taking it on the chin here.

N-Y-R-A........Not-for-profit, just for our own little fun and games.

I will add two additional points. First, as a general rule, in Corporate America top senior management (CEOs, CFOs, COOs et al) which accrue too many years of losses are not allowed to to stick around for long in most corporations (check out the upper management turnover rates at Magna). Sometimes its more symbolic or sacrificial, but they have to go. Second, how many businesses are able to continue to operate as if an additional revenue flows (slots) are imminent when that additional revenue source has been nothing more than a pipe dream for years? This is usually a good recipe to have a "Going Concern" paragraph included in their annual auditor's report sooner rather than later.

[Indulto]

http://www.bloodhorse.com/horse-racing/articles/57933/nyra-among-groups-considering-otb-takeover (http://www.bloodhorse.com/horse-racing/articles/57933/nyra-among-groups-considering-otb-takeover)
NYRA Among Groups Trying To Take Over OTB
By Tom Precious Friday, July 16, 2010A number of groups, including the New York Racing Association, have approached state officials about taking over all or part of the New York City Off-Track Betting Corp.

… “I believe the only way New York City OTB survives is if somebody takes it over or we create a partnership,’’ Schwartz said.

The new OTB chairman said a number of top officials at the agency, which has been owned by the state for a couple of years, have been let go. They are also getting rid of OTB’s controversial fleet of cars as well as several consulting contracts, and are actively planning the closure of at least 11 betting parlors.

… NYRA in the past has expressed interest in getting a piece of t NYCOTB’s betting operations, and there has long been talk about the various OTBs in the state merging with NYCOTB.

“It can’t be any longer 'let’s talk about it, meet about it.’ And then everybody gets into a turf battle. I’m not going there. I’m determined, on behalf of the governor, to solve this problem before he leaves office,’’ Schwartz said. Paterson’s term ends Dec. 31.

Besides NYRA, Schwartz said some OTB agencies and harness tracks have discussed having a possible role or stake in NYCOTB. He did not name them. He said he was doubtful there could be enough administrative- or legislative-approved savings to permit OTB to remain as a stand-alone corporation.

… Greg Rayburn, the new president of NYCOTB, said the first task during his first week on the job has been to deal with the corporation’s immediate cash-flow problems. “In my line of work, cash is oxygen. I need to maximize the oxygen so we can be viable long-term,’’ said Rayburn, a corporate reorganization expert whose most recent stint was at Magna Entertainment Corp.

… “The company is living on borrowed time,’’ Rayburn said of the cash-flow crunch affecting its bottom line. He said it is uncertain where OTB is headed--whether it will be privatized or face some sort of cooperative deal with NYRA or other OTBs in the state. But he said it will take the backing of its bankruptcy creditors, the unions that represent its 1,000 or so workers, and the legislature. …http://www.thoroughbredtimes.com/national-news/2010/July/16/New-OTB-chief-hopes-to-have-restructuring-plan-in-30-days.aspx (http://www.thoroughbredtimes.com/national-news/2010/July/16/New-OTB-chief-hopes-to-have-restructuring-plan-in-30-days.aspx)
New OTB chief hopes to have restructuring plan in 30 days
by Paul Post July 16, 2010… Greg Rayburn … says all stakeholders—race tracks, breeders, unions, and government—will have to share some of the pain involved with getting New York City OTB back on solid financial ground.

He said he is not convinced that the New York Racing Association should ultimately run the company. In most states, the racetrack operator controls distribution of the racing product.

“They have their own issues,” Rayburn said of NYRA on Friday during a conference call, adding that “collapsing pieces into other pieces” might or might not work.

“… There’s no question that participants in our creditors’ group are suffering because of our bankruptcy and inability to make full [statutory] payments.”

… Rayburn said some closures and layoffs are needed, but not as many as called for by Frucher.

Rayburn said New York City OTB should be run by someone with more gaming expertise. At present, it has no rebate rewards program, making it difficult to compete with account deposit wagering firms that do. He also said that the company needs to establish a capital reserve fund, allowing it to invest back into the business. …

[Indulto]

http://www.nydailynews.com/opinions/2010/07/19/2010-07-19_quit_betting_on_the_nag.html (http://www.nydailynews.com/opinions/2010/07/19/2010-07-19_quit_betting_on_the_nag.html)
Quit betting on the nag: State must scratch dumb plan for slots at Aqueduct
Editorial July 19th 2010… If Paterson, Assembly Speaker Sheldon Silver and Senate Democratic conference chief John Sampson were interested only in generating revenue for the state from casino wagering, they'd locate the establishment in a central, highly trafficked spot. That's not Aqueduct.

Franchising the track for slots makes limited economic sense and, far worse, would steal from the city the chance to devote Aqueduct's many acres to residential or business development.

The site could become, by far, the city's largest cleared-ground building project, offering vast possibilities for affordable housing, schools and commerce. Such development would generate enormous revenues that NYRA, as franchise holder, would be entitled to share.

… "It seems reasonable to ask whether a declining race track and a few thousand slot machines are the best we can do with 192 acres of publicly owned land located next to one of the nation's busiest airports."

The track's potential makes all the more outrageous Albany's insistence on casino gambling in the face of endless evidence the plan can't work.

The Lottery Division is completing the state's fourth attempt at a slot machine deal, dating back nine years. Scandals and financial miscalculations have derailed all previous tries. This one is similarly headed down the tubes.

… Paterson and the Legislature can still do the right thing: Move what's left of racing 8 miles away, to Belmont, scrap the slots and put the Aqueduct property to genuinely fruitful use.http://www.drf.com/news/article/114975.html
Saratoga opens 40-day meet
By David Grening 7/21/2010… Charles Hayward, NYRA's president and CEO, acknowledges that the Saratoga product will consist of more cheaper claiming races than in the past but added that in the late 1980s and early 1990s Saratoga ran $10,000 claiming races.

"The good ol' days weren't necessarily good," Hayward said. "And just because they're cheaper races doesn't necessarily mean they're not good races to bet on."

Last year, Hayward projected a 5 percent decline in business from 2008, but in the end, all-sources handle was down 1.7 percent. …http://www.drf.com/news/article/114837.html
New York can no longer afford to drag its heels
By Steven Crist 7/16/2010,… The only way to get the attention of anyone in New York state government about racing is to suggest that the Belmont Stakes or the Saratoga meeting might have to be canceled. …

,,, So those threats were floated, and the state finally lived up to its agreement and provided a loan in late May that will be repaid by the eventual racino operator.

… Then Lucy pulled the football away from Charlie Brown once again. Two of the three bidders for the racino were disqualified earlier this month, and then last week a previously rejected bidder got a judge in Schenectady to halt the entire process. Now there's talk that the Aug. 3 deadline will come and go and nothing will happen until a new governor, presumably the odds-on Andrew Cuomo, is installed in January.

Then there's the ongoing saga of New York City OTB, which is in bankruptcy and owes the NYRA $20 million in unpaid statutory betting commissions and is now being run by a $125,000-a-month bankruptcy-reorganization specialist. It also was reported last week that despite claiming to have no cash to pay its bills, NYCOTB has shelled out nearly $500,000 since last fall to a fancy public-relations firm for a campaign to rehabilitate its public image.

Said campaign has been utterly invisible and ineffective, with the notable exception of the editorial boards of the city's three daily newspapers. The Daily News, Post, and Times have dutifully swallowed OTB's outrageous canard that its problems are the result of paying too much for the signals on which it handles nearly $1 billion a year -- rather than, say, its being a bloated and anachronistic system that actually underpays the racing industry and instead spends that money providing redundant jobs for politicians' cronies. …http://sports.espn.go.com/sports/horse/news/story?id=5386875 (http://sports.espn.go.com/sports/horse/news/story?id=5386875)
New York OTB may cut funds
By Matt HegartyJuly 16, 2010… the various constituencies that receive a piece of New York City OTB's revenue will be expected to "compromise" on changes to the formulas governing the distribution of the money. …

… "It's pretty hard for me to imagine a process . . . not involving some level of compromise from each constituent," Rayburn said. He said that the statutorily set formulas would need to be reset in order to generate enough cash flow to make New York City OTB "fundamentally viable, with some sort of capital reserve."

In the week that Rayburn has been at New York City OTB, he has sought to identify areas in which the company can immediately cut costs, he said, including firing a handful of top executives. …
… The effort to restructure New York City OTB will have significant repercussions on the New York racing industry, and officials of the New York Racing Association have made attempts to convince legislators and the governor to support proposals that would transfer some of OTB's operations to the association, including the OTB company's account-wagering operation. A transfer could form a bargaining chip that the industry may use if forced to accept a lower cut of OTB's betting revenues.

Rayburn said that he had considered "collapsing some pieces [of OTB's operations] into other pieces," including transfers to NYRA, but he said that those plans were not specific. …

… "It will probably be one in which everyone is equally unhappy," Rayburn said.http://www.saratogian.com/articles/2010/07/18/opinion/doc4c423639212d7216852708.txt (http://www.saratogian.com/articles/2010/07/18/opinion/doc4c423639212d7216852708.txt)
Editorial: New York racing at a crossroads
July 18, 2010… on Friday the head of bankrupt New York City Off Track Betting Corp. says he’ll have a plan in place for restructuring the firm within 30 days. Guess you get results when you hire a consultant for $125,000 per month.

Restructuring should not be the key word. It should be deconstructing. Times have changed but OTB hasn’t. We’re not convinced NYRA, a private company, should take over the operation. But we have no doubt that the bloated, uncoordinated, patronage-laden, archaic OTB setup that rakes in millions for the state (and some locales) while ending up in the hole must be scrapped. …http://www.timesunion.com/AspStories/story.asp?storyID=951858&category=ODATO&BCCode&newsdate=7%2F18%2F2010 (http://www.timesunion.com/AspStories/story.asp?storyID=951858&category=ODATO&BCCode&newsdate=7%2F18%2F2010)
Queries at NYC OTB
By JAMES M. ODATO day, July 19, 2010 … The state comptroller is demanding documentation concerning Rayburn's hiring as CEO; two Assembly Democrats are calling for an independent probe; and some OTB board members say they aren't going to be rubber stamps. There are concerns in some quarters that Rayburn may be too cozy with the New York Racing Association. Today, NYRA is loaning Rayburn one of its top financial professionals, David O'Rourke. NYRA will keep paying him during his assignment on Rayburn's team.

… "The board was certainly not advised of it ... and it should have been," said Steven Newman, Assembly Speaker Sheldon Silver's appointee on the NYCOTB board. Newman also is a member of the state's NYRA oversight board, which is supposed to keep an eye on the racing association during its 25-year franchise to run the state's Aqueduct, Belmont and Saratoga tracks.

Rayburn worked with Brian Rosen, NYRA's bankruptcy lawyer -- which is either a potential conflict or something that presents the appearance of one, Newman said. NYCOTB is NYRA's biggest business partner and owes the association more than $17 million. At the same time, NYRA has desires on some of the OTB's core assets -- including the highly valuable Internet and telephone betting units -- and Rayburn's plan for the OTB could include mergers or sell-offs.

Newman wonders if NYRA had a hand in Rayburn's candidacy. NYRA has refused to answer questions about Rayburn, although it has been publicly supportive of his hiring. Rosen did not return a call. "In government, it's important to assure the public of the fairness of the process and the independence of its officials," said Newman. OTB board veteran David Cornstein said Rayburn is getting an exorbitant salary and was quickly hired without the normal due diligence. He promised to fight any proposal to turn over some of the business to NYRA ("the most incompetent entity I have ever run into in business").

Rayburn said discussion about any conflict is "silly". He did not discuss Syntax-Brillian, a company he joined two years ago just before it went bankrupt, an experience Paterson's spokesman called "a non-issue." Rayburn was elevated to CEO and faced criticism for expensive perks from some shareholders angry at the prior management's alleged siphoning of tens of millions of dollars. Some investors alleged in bankruptcy court that Rayburn was part of a culture of corruption because he did not expose alleged widespread fraud even though he is a certified fraud examiner.

"I was not retained as a fraud expert. I was retained to try to fix the operations of this business," Rayburn told the court, adding that the Securities and Exchange Commission was investigating and he didn't believe in duplicating services.

[classhandicapper]

Indulto,

I hate to say it in a racing forum, but I also think Aqueduct should be plowed under and the land used for more economically attractive alternatives.

This whole casino/racing combination popular throughout the industry is atrocious economics and delaying the restructuring that the racing industry needs.

In the real world, no one starts an attractive business in order to support a terrible business and keep it open. They close the terrible business, use the capital in better ways, and create more profits, jobs, economic activity etc.. for all.

Racing needs to restructure. All the tracks that are not viable as stand alone businesses need to be closed so the handle at those tracks gets spread around to the remainder of them and makes them more profitable. That would be very easy to accomplish in an era of phone and internet wagering.

All of this is impossible because government is involved and the process is horribly corrupt and incompetent.

[Indulto]

Indulto,

I hate to say it in a racing forum, but I also think Aqueduct should be plowed under and the land used for more economically attractive alternatives.

This whole casino/racing combination popular throughout the industry is atrocious economics and delaying the restructuring that the racing industry needs.

In the real world, no one starts an attractive business in order to support a terrible business and keep it open. They close the terrible business, use the capital in better ways, and create more profits, jobs, economic activity etc.. for all.

Racing needs to restructure. All the tracks that are not viable as stand alone businesses need to be closed so the handle at those tracks gets spread around to the remainder of them and makes them more profitable. That would be very easy to accomplish in an era of phone and internet wagering.

All of this is impossible because government is involved and the process is horribly corrupt and incompetent.CH,
I've long been an advocate of AQU closing as a racetrack and eliminating winter racing. At first I thought a racino at AQU could eliminate the need for slots at BEL, but now I think that without slots, BEL will eventually have to close as well.

[PaceAdvantage]

Slots at any NYRA racetrack should be viewed as an abomination.

[Tom]

Can't you just picture a row on machines along the back side of the tent at Toga? Might keep the rainwater from gushing in! :rolleyes:

[KingChas]

Slots at any NYRA racetrack should be viewed as an abomination.

Does this mean I can't go to the Saratoga harness track this year,PA? :(

[Indulto]

Slots at any NYRA racetrack should be viewed as an abomination.It isn't just NYRA that needs the money from VLTs now. At this point Hayward and the board couldn't care less who the operator is; only that there is one.

http://www.timesunion.com/AspStories/story.asp?storyID=953431 (http://www.timesunion.com/AspStories/story.asp?storyID=953431)
They're off -- but where to?
As yearly Saratoga meet gets under way, racing's future is open to question
By DENNIS YUSKO July 23, 2010… VLTs are now in eight New York casinos, including Saratoga Gaming and Raceway, which used to be a dying harness track. VLT money greatly increased the facility's race purses and saved several other harness tracks in the state, said Bennett Liebman, a NYRA board member who is director of the Government Law Center at Albany Law School.

… VLTs make money. The eight casinos in the state made a net of $1.04 billion in the fiscal year ending in March, up 7.5 percent from last year, according to the state Lottery Division. Profit was $493.4 million, an increase of 7.8 percent, the lottery said.

But Liebman warned that VLT revenues can't reverse the continuing decline of public interest in racing and fewer people betting. "Is it keeping tracks afloat? Yes. But is it finding new fans? No," said Liebman.

Hayward said NYRA needs VLTs to stay in business for the next couple of years. If an operator is picked for the Aqueduct project, the winning bidder would pay back the $25 million loan for the Saratoga meet and NYRA would return it over the long term, he said. A VLT operator could be picked by Aug. 3, Hayward said. …

[PaceAdvantage]

Does this mean I can't go to the Saratoga harness track this year,PA? :(Who said anything about Saratoga harness? I was strictly referring to Aqueduct, Belmont & Saratoga Race Course.

[Indulto]

http://www.nyra.com/saratoga/stories/July232010b.shtml (http://www.nyra.com/saratoga/stories/July232010b.shtml)
NYRA Launches Stewards’ Decisions Communication Initiative
By Dan Silver July 23, 2010Starting today ...
... the stewards’ race-day decisions involving the official order of finish will be communicated via the simulcast feed and will also be posted to NYRA.com.

Directly following any decision they make having to do with the official order of finish, including inquiries and objections, the stewards ...
... will provide an explanation of what happened and the reason for their decision. That information will then be communicated via the NYRA television feed and will be posted on the new Stewards’ Corner section on NYRA.com, located at the following link:

http://www.nyra.com/stewards/sar/index.shtml (http://www.nyra.com/stewards/sar/index.shtml)

“This new policy is a big step forward in providing transparency of the stewards’ decision making,” NYRA President and CEO Charles Hayward said. ...

... “We’re thrilled to expand the amount of information available to the wagering public,” NYSRWB Chairman John Sabini said. ...
... this new stewards’ communications initiative helps create an even more fan friendly environment at the NYRA tracks.”

“We are fully supportive of any efforts to improve communication to racing fans, and commend NYRA and the NYSRWB for their efforts in this regard,” said James L. Gagliano, president and chief operating officer of The Jockey Club. “This new initiative should serve as a model for other racing jurisdictions throughout the country.”

[Indulto]

http://cs.bloodhorse.com/blogs/vic-zast-saratoga-diary/archive/2010/07/31/money-goes-round.aspx (http://cs.bloodhorse.com/blogs/vic-zast-saratoga-diary/archive/2010/07/31/money-goes-round.aspx)
Money Goes 'Round
By Vic Zast 31 Jul 2010Optimists will say that NYRA caught a break Thursday when Judge Barry D. Kramer, a former NBA basketball player, ruled that Aqueduct Entertainment Co. could not sue Lottery for excluding it from further consideration in the nine-year process to name a VLT operator for Aqueduct. But pessimists will point out that Gov. Exit and the two ranking Dumocrats – one from Brooklyn and the other from Manhattan - still will have to approve any forthcoming appointment. To date, that has been a challenging task.

Legal entanglements came into play on another front. Jeffrey Tucker, a New York horseman who used to lend the use of his Stonebridge Farm in Northumberland, NY to Equine Advocates for its annual dinner and auction, was named in a suit filed by the court appointed trustee overlooking liquidation of Bernie Madoff’s investment firm. The court appointed trustee is seeking more than $3.6 billion from Tucker and other defendants who he claims helped Madoff with his $65 billion Ponzi scheme.. …http://www.saratogian.com/articles/2009/02/11/news/doc4992438d22380976620825.txt (http://www.saratogian.com/articles/2009/02/11/news/doc4992438d22380976620825.txt)
Madoff victim eyes sale of horse farm
By PAUL POST February 11, 2009 The owner of an exclusive thoroughbred farm might be forced to sell the operation because of losses suffered in Bernard Madoff’s alleged $50 billion Ponzi scheme.

,,, Tucker is a founding partner of Fairfield Greenwich Group that invested $7.5 billion with Madoff, the most of any one entity and more than half its $14.1 billion in managed assets.

… Tucker has invested millions at Stonebridge in recent years. In July 2007, the farm unveiled a new 7/8-mile Polytrack, an artificial surface training track designed to reduce equine injuries. The main 188-acre farm off Stonebridge Road also has state-of-the-art barns, an indoor arena and sophisticated training equipment.

… Madoff was arrested on Dec. 11 after he allegedly confessed to conducting a large Ponzi scheme, named for a 1920s scam artist. His victims include numerous high-profile investors including New York Mets owner Fred Wilpon.

… Tucker was chairman of Empire Racing Associates, one of three firms that challenged New York Racing Association for the state’s latest racing franchise. …http://www.bloodhorse.com/horse-racing/articles/33730/empire-racing-group-names-tucker-chairman (http://www.bloodhorse.com/horse-racing/articles/33730/empire-racing-group-names-tucker-chairman)
Empire Racing Group Names Tucker Chairman
By Tom Precious May 28, 2006Jeffrey Tucker, a New York breeder, has been named chairman of the fledgling Empire Racing Associates, a group of horsemen and breeders trying to position itself to be among the holders of a new Thoroughbred racing franchise in New York.

Tucker, who owns Stonebridge Farm near Saratoga is a founding partner of Fairfield Greenwich Group, a Manhattan hedge fund company that manages over $9 billion in assets for its clients.

"He'got a lot of business savvy, a lot of deal-making savvy," said Jeff Perlee, executive director of ERA. "He's got that kind of perspective that racing in New York can really benefit from." …

[Indulto]

http://www.drf.com/news/new-york-lottery-approves-aqueduct-casino-bidder (http://www.drf.com/news/new-york-lottery-approves-aqueduct-casino-bidder)
New York Lottery approves Aqueduct casino bidder
By Matt Hegarty 08/04/2010Genting New York, a subsidiary of a sprawling Malaysian company that also owns a large minority stake in a New York harness track, should receive state approval to operate a long-stalled casino at Aqueduct racetrack in Queens that could inject $60 million into the New York Thoroughbred industry each year, the New York Lottery said on Tuesday.

… The recommendation will have to be endorsed by Gov. David Paterson, who has already said that he will accept lottery’s recommendation, and by the leaders of the state’s Senate and General Assembly.

“We are reviewing the recommendation of the lottery,” said Sisa Moyo, a spokesperson for the Speaker of the Assembly, Rep. Sheldon Silver. Moyo said she could not provide a timetable for when Silver would make a decision about whether to endorse the recommendation.

… Genting is one of the largest companies in Malaysia, with dozens of gambling and hotel properties, along with investments in energy and agriculture. In 2009, the company paid $55 million for a 49 percent stake in Monticello Raceway, a New York harness track that also operates a casino. In addition, the company has provided financing for the construction of two other racetrack casino properties in New York, and many of its top officials had already been evaluated by the lottery for their suitability for casino licenses.

… Medenica said in his letter to Paterson that Genting’s proposal was “impressive on many levels.”

“Genting took nothing for granted – they respected the very rigorous selection process that we developed after the missteps of the past,” Medenica wrote. “They understood the business risks that a winning bidder is required to accept, and they have a clear and rational plan for navigating the complex construction and operating environment of New York City.”http://saratogian.com/articles/2010/08/04/news/doc4c58451d741fa719984912.txt (http://saratogian.com/articles/2010/08/04/news/doc4c58451d741fa719984912.txt)

Lottery officials recommend Genting New York as Aqueduct racino operator (with report)
By Paul Post August 04, 2010… The project, if it becomes reality, would put New York Racing Association on solid financial ground for the first time in many years, securing the future of Saratoga racing, one of the most important elements of the local economy.

NYRA is slated to get 7 percent of revenues, and another 6.5 percent — increasing to 7.5 percent in three years — would go to purses. These figures combined, along with money going to breeders, could pump more than

$100 million per year into the state’s thoroughbred industry.

"It’s a game-changer," NYRA Vice Chairman James Heffernan said.http://www.saratogian.com/articles/2010/08/03/news/doc4c5859d3652cb530311650.txt (http://www.saratogian.com/articles/2010/08/03/news/doc4c5859d3652cb530311650.txt)
New York Racing Association vice chairman: Pataki aide offered seat on NYRA board for $100K contribution
By PAUL POST August 03, 2010A high-ranking New York Racing Association official dropped a political bombshell Tuesday morning, saying he was asked to pay a $100,000 campaign contribution to former Gov. George E. Pataki in return for a seat on the NYRA board.

But a Pataki spokesman, responding later in the day, said no such thing ever happened.

NYRA Vice Chairman James Heffernan spoke about the alleged solicitation — a criminal act — at Tuesday’s annual Saratoga Institute on Racing and Gaming Law at the Gideon Putnam Hotel. He said he wouldn’t pay for the seat, but was still appointed.

Asked by someone in the audience why he never reported the incident to authorities, Heffernan said, "I didn’t feel it was my responsibility."

Heffernan, an attorney and corporate restructuring expert, later joined the board and has been one of NYRA’s lead negotiators in seeing it through bankruptcy, winning a new franchise and dealing with the state’s selection of an Aqueduct gaming operator. He made the startling statement during a panel discussion about NYRA’s past, present and future financial condition.

… Heffernan, a longtime racing fan, said he first wrote to then-Gov. Pataki to offer his service, business and legal talents. Heffernan said a local political official set up a meeting between himself and a Pataki aide. After meeting, the aide offered a position on the NYRA board in return for a $100,000 contribution, Heffernan said.

Heffernan said he had previously attended a $1,000-a-plate dinner for Pataki, and that he told the Pataki aide he wouldn’t pay another $99,000 to join NYRA.

After declining he thought he would no longer be considered but was later offered a board appointment and accepted. In response to the audience question, Heffernan said he didn’t feel uncomfortable accepting the post.

After learning of the remarks, Pataki spokesman David Catalfamo sent The Saratogian an e-mail saying "Heffernan’s claims are absurd, shameful and untruthful — period."

Pataki now works for Chadbourne & Parke, an international law firm with offices in New York City.

In a related matter, also while on the Racing and Gaming Law panel, Heffernan said he believed Pataki deliberately stalled a deal NYRA had with MGM to run Aqueduct’s racino, so another party could take over New York racing. If the racino had opened earlier, he said, NYRA would have had no trouble winning a new racing franchise, because it would have been on firm financial ground. Instead, two other firms challenged NYRA for the racing contract, which NYRA eventually got anyway in September 2008.

Catalfamo refuted those allegations, too.

The state’s thoroughbred industry has suffered immensely because of the state’s failure to get Aqueduct’s proposed racino open. "NYRA never would have gone bankrupt," Heffernan said. "We could have done all kinds of capital improvements. Tens of millions of dollars were lost." …http://www.bloodhorse.com/horse-racing/articles/58217/genting-ny-to-run-aqueduct-casino-project (http://www.bloodhorse.com/horse-racing/articles/58217/genting-ny-to-run-aqueduct-casino-project)
Genting NY to Run Aqueduct Casino Project
By Tom Precious August 4, 2010… In a 28-page report recommending Genting, the lottery agency said its pick for the franchise has proposed opening an initial VLT facility at the track, with 1,600 VLTs, within six months of signing a deal with the state. The remaining machines would be ready on two floors of gambling space six months after that, along with a 2,100-space parking garage and a new pedestrian bridge to a nearby subway station.

The report said Genting scored 95 out of 100 points in the evaluation process. It noted Genting New York is a subsidiary of Genting Malaysia Berhad, a public company with $1.6 billion cash on hand and a market capitalization of $5.25 billion. It is an affiliate of its parent Genting Group of Cos., which runs casino facilities in Malaysia, Singapore, the Philippines, and Great Britain.

Stefan Friedman, a Genting spokesman, said the company's selection will create 2,000 construction jobs and lead to more than $500 million in revenue annually for the state. …

… "We hope the Lottery’s recommendation will be endorsed by the legislature so we can immediately get to work creating jobs, preventing layoffs, and delivering more than $15 billion in economic benefits to New York over the next 30 years," Friedman said.

… After the lottery agency recently tossed out two of the three bidding groups left in the process, Genting’s selection was all but assured. Three of Genting New York’s major principles have already been licensed by the lottery to be partial owners of Monticello Raceway's VLT casino. Besides Monticello, Genting helped finance Indian-owned casinos in Niagara Falls, N.Y., and Connecticut.

The decision comes less than a week after Aqueduct Entertainment Co., which won, and then lost, a previous bidding round for Aqueduct, had its court case to re-install its bid rejected by a state judge. The company is appealing, so it is uncertain if that could delay the Genting situation.

… Medenica said Genting is experienced and its plan “reflects a deep and insightful understanding of the opportunity and challenges of Aqueduct.” He said the company also understands the project’s business risks, and “they are highly sensitive to the community issues, labor requirements, and social concerns that a project of such scope encompasses.”

The lottery director said other bidders rejected earlier “made the fatal assumption that the process was still open to maneuvering and negotiation.”

Medenica said Genting also passed an “exhaustive” vetting process of its principles and investors. …http://www.timesunion.com/local/article/Lottery-Division-recommends-Aqueduct-developer-600993.php (http://www.timesunion.com/local/article/Lottery-Division-recommends-Aqueduct-developer-600993.php)
Lottery OKs racino operator
By JAMES M. ODATO August 4, 2010…Assemblywoman Audrey Pheffer, D-Queens, said she hopes the deal gets done quickly although she was disappointed that Genting plans to open the facility in phases, with about 1,600 machines after six months after signing an agreement and a completed project within 18 months. The company won over the community in a presentation and has committed to set aside one percent of profits for local community investments, she said.

"They're a very impressive organization," NYRA President Charles Hayward. He said the company has a great plan.

… John Sabini the head of the state Racing and Wagering Board, said the board still has an open investigation of an arm of Genting related to a complaint involving Empire Resorts' Monticello Raceway's track and racino, which is majority-owned by an arm of the multinational Genting group.

Sabini said that investigation was "wrapping up ... but if the (Aqueduct) deal goes down it's a good thing for racing in the state of New York." …

[Indulto]

http://www.bloodhorse.com/horse-racing/articles/58435/paterson-legislators-sign-aqueduct-vlt-pact?source=rss (http://www.bloodhorse.com/horse-racing/articles/58435/paterson-legislators-sign-aqueduct-vlt-pact?source=rss)
Paterson, Legislators Sign Aqueduct VLT Pact
By Tom Precious August 17, 2010 It has taken three governors four different tries, but Gov. David Paterson and legislative leaders made it official Aug. 17: Genting New York will be the operator of the Aqueduct video lottery terminal casino.

… But while the approval by Paterson, Assembly Speaker Sheldon Silver, and Senate Democratic Conference Leader John Sampson appears to seal it for Genting, two last stops along the way are needed: Approvals from state Comptroller Thomas DiNapoli and Attorney General Andrew Cuomo.

… “Genting, a world-renowned and experienced gaming company, presented a thoughtful and comprehensive proposal for the VLT facility at Aqueduct,” Silver said in a statement. “We look forward to the development of a world-class gaming facility that will maximize revenue for the state of New York, create thousands of jobs, and greatly enhance economic development in the surrounding community for many years to come.”http://www.timesunion.com/local/article/Will-deal-get-racing-back-on-track-618701.php (http://www.timesunion.com/local/article/Will-deal-get-racing-back-on-track-618701.php)
Will deal get racing back on track?
By DENNIS YUSKO August 17, 2010A deal to subsidize horse racing in New York through proceeds from a nearly approved casino at Aqueduct Race Track has horsemen and Saratogians practically skipping down Broadway.

… Malaysian resort and casino operator Genting New York LLC wants to have at least some of the 4,500 video slot machines in operation at the New York City track by April, a plan that is backed by Gov. David Paterson and the state Legislature.

It now requires only the signatures of the state attorney general and comptroller.So it isn’t the “three men in a room” anymore? This is starting to sound a lot like Speaker Silver’s previous approval of AEG knowing the principals couldn’t withstand scrutiny.

How likely is approval by Cuomo or Di Hapoli until after the elections?… NYRA would get 7 percent of the gross gambling revenue generated by the machines, and an additional 6.5 percent would be dedicated to the thoroughbred industry for race purses at NYRA tracks. If 4,500 slots at Aqueduct made $275 per machine, per day -- a conservative estimate -- NYRA would get $31.6 million a year for track improvements and operating costs, and purses would jump by $29.3 million a year. But no takeout relief for customers.… Final project approvals could come in days or weeks, though concerns have been raised about Genting's business dealings. Moving the project forward would cap nine years of off-and-on negotiations that left horsemen frustrated and racing teetering on insolvency.

… Under the Aqueduct deal, Genting would pay an upfront fee of $380 million to the state and assume responsibility for the $25 million that the state loaned NYRA. Building could start at Aqueduct after the fee is paid. The racing association would use money made by slots to pay back the $25 million to Genting. … Choosing a bidder from a field of one has the odor of elections in the old Soviet Union

Cuomo could still decide the deal should be approved by the next governor, attorney general, Comptroller, and legislature with specific voter support for their stated positions instead of endorsing a decision by the current dysfunctional Governor and Senate.

If he approves prematurely, and Genting actually has a sleleton in its closet, then he can wave good bye to the Governor's office.

VLTs at Belmont (and not at Aqueduct) could be more lucrative long-term for both NYRA and the State, and would allow them to close Aqueduct sooner if slots don’t prove to be the savior that residents dancing in the streets of Saratoga seem to think they are.

[Indulto]

http://www.nytimes.com/2010/08/29/sports/29otb.html (http://www.nytimes.com/2010/08/29/sports/29otb.html)
OTB Executive Offers Turnaround Plan
BY BILL FINLEY August 28, 2010… if his proposal was rejected by creditors, union officials or state lawmakers, he would close the corporation or attempt to void the existing union contracts and slash wages.

That Rayburn wants to re-emphasize neighborhood betting parlors goes against the conventional wisdom in the horse racing industry …

“The issue is, what are your assets and what do you focus on?” he said. “The reality is our best asset is our customers. They come in every day, and it is more than a gambling operation for them. It is a social club, and they provide us with a significant piece of handle.”

… Rayburn said the biggest drain on OTB’s bottom line was its account wagering business, which allows customers to bet over the phone or on the Internet. Similar operations at other tracks and off-track betting (http://topics.nytimes.com/top/reference/timestopics/subjects/h/horse_racing/offtrack_betting/index.html?inline=nyt-classifier) operations are generally profitable, but Rayburn said New York’s OTB was hurt by high labor costs and other inefficiencies that the racetracks would not face.

… Should the tracks take over OTB’s account wagering business, Rayburn said most of the 230 people now working for the corporation in that area would be laid off, as would some 170 other OTB workers.

… “The mistakes made over the years is that there has never been a capital reserve, so there has never been reinvestment in either physical plants, technology or people. What I am telling people is that if we can retain a reasonable capital reserve, we can invest in these things, technology, locations and new prototypes.”

.. “What I have tried to make clear to the constituents I have dealt with is that people should not sit back and expect the state will bail out OTB to keep OTB in business,” he said. “There might be people out there who still harbor those thoughts. It is foolish to think that we wouldn’t liquidate if we can’t get one of these plans to become a reality.”http://saratogian.com/articles/2010/08/28/news/doc4c787600bbf03039286732.txt (http://saratogian.com/articles/2010/08/28/news/doc4c787600bbf03039286732.txt)
NYRA would take over New York City OTB's account wagering system under proposed plan
By PAUL POST August 28, 2010[QUOTE]… The tracks would also sacrifice $32 million in “give-backs” to OTB, which has debts totaling $95 million and owes NYRA — its second largest creditor — more than $20 million alone.

Bankrupt New York City OTB is under a hard deadline to get the plan worked out by Tuesday so that it can opt into an early state retirement incentive program. But unions are objecting to key points such as elimination of Sunday double-time pay, while demanding that a set number of jobs be kept regardless of handle and revenue.

… If a so-called Plan A isn’t reached, OTB has two options — it could seek to sever its union contracts in bankruptcy court, certain to trigger litigation, or liquidate the business, which handles more than

$750 million worth of wagers per year. Rayburn said he doesn’t believe NYRA or the state’s five other OTBs would be able to recoup all that income, much of which might go out of state.

“Frankly, liquidating the business is a bad outcome for the racing industry in New York,” Rayburn said. “Massive loss of handle is going to have some downstream effects.”

… Rayburn said OTB’s account wagering system has an estimated $20 million value, but would satisfy a $65 million debt to the tracks. The difference represents what OTB is able to pay creditors on the dollar, he said.

… NYRA has long lobbied for a merging of some operations between the tracks and all off-track betting entities, which it says would cut costs and eliminate duplication of services. Shared marketing programs and tote contracts have also been called for. …http://www.nydailynews.com/ny_local/2010/08/28/2010-08-28_bankrupt_otb_plays_hardball_threatens_to_break_ union_deal.html (http://www.nydailynews.com/ny_local/2010/08/28/2010-08-28_bankrupt_otb_plays_hardball_threatens_to_break_ union_deal.html)
Bankrupt OTB threatens to break union contract if concessions aren't made
BY Kenneth Lovett August 28th 2010[QUOTE]… An agreement by Tuesday would allow OTB to opt into a state early-retirement program.

OTB's unions have opposed two of the key givebacks sought by management.

The unions are refusing efforts to do away with double time on Sundays, even though it's part of the regular workweek. And they want per-diem workers who don't get benefits to be fired before staffers, who get benefits.

District Council 37 also wants a written commitment to keep minimum staffing levels. Talks with the unions and creditors are continuing, he said.

If no deal is reached, breaking the union contract while still seeking a deal with creditors is Plan B, Rayburn said. Breaking the contract would allow them to reduce worker salaries and benefits unilaterally.

The third option would be to close down OTB.

… DC 37 President Leonard Allen said there are some things the union simply can't agree to.

"You can't give me a gun and tell me to shoot myself," he said. "You might shoot me, but you can't tell me to pull the trigger and that's what he wants us to do." …http://www.nypost.com/p/news/local/otb_honcho_saddled_with_tubborn_w4gJvkvrr4k9356tBz ltEM (http://www.nypost.com/p/news/local/otb_honcho_saddled_with_tubborn_w4gJvkvrr4k9356tBz ltEM)
OTB honcho saddled with '$tubborn' union
By DAVID SEIFMAN August 29, 2010… Greg Rayburn told reporters in a conference call that "pretty much every one" of OTB's creditors has agreed to givebacks to keep the city's only legal bookie afloat -- except for Local 2021, which represents more than 1,000 employees.

… If he can't reach a deal by Tuesday, when a state early-retirement offer ends, Rayburn said he's prepared to terminate the union's contract.

"It's doable in bankruptcy," he said. "It's a tool that's available. It's not one we want to use."

Union president Lenny Allen … said the elimination of Sunday overtime would cut the salaries of his members from an average of $40,000 to less than $32,000.

He pointed out that he had an agreement with previous OTB chairman Sandy Frucher that guaranteed a minimum number of union jobs after the restructuring is complete.

Rayburn countered that it's not going to happen under his watch.

… Rayburn also wants the right to retain per diem workers while he's laying off their full-time counterparts, who collect costly fringe benefits, something that would be difficult for any union to accept.

Rayburn estimated OTB's debts at $95 million, with two-thirds owed to racetracks. He said the New York Racing Association and Yonkers Raceway were willing to take over OTB's phone and Internet betting operations, which he valued at $20 million, as a settlement, and are also prepared to surrender about $32 million a year in revenue from OTB.

Rayburn put the union's givebacks at $16 million a year. But Allen said the racing industry's savings would last for only two years, and he questioned why the phone-betting business wasn't appraised before being peddled to creditors.

The state Legislature, which has proven sympathetic to OTB workers in the past, would have to approve six or seven key elements of Rayburn's plan. …http://www.bloodhorse.com/horse-racing/articles/58610/nycotb-could-shed-about-100-million-in-debt (http://www.bloodhorse.com/horse-racing/articles/58610/nycotb-could-shed-about-100-million-in-debt)
NYCOTB Could Shed About $100 Million in Debt
By Eric Mitchell August 28, 2010Some of New York City Off-Track Betting Corp. creditors are poised to forgive nearly $100 million in debt.

… The seven creditors are the New York Racing Association, Churchill Downs, Inc., Paramount Leasehold, L.P., Finger Lakes Racing Association, Empire Resorts/Monticello Raceway, Yonkers Racing Corp., and the public employee labor union District Council 37/Local 2021.

… “If an agreement is reached, then what would be forgiven is what was owed to these seven creditors only from the time NYCOTB filed for bankruptcy through July 31,” said Dwayne Andrews, a principle in the government relations group for Blank Rome. “We can’t go into specifics because it is still being negotiated. We are closer to an agreement.”

… Besides the union concessions, Rayburn’s plan for restoring the financial health of NYCOTB includes having other creditors settle their claims for undisclosed amounts, reduce payments to racetracks by about $32 million annually, and have the state drop $10 million of claims. He also wants lawmakers in Albany to change state law but didn’t say what changes he would be seeking. …

[Indulto]

http://www.saratogian.com/articles/2010/10/07/news/doc4cae3a198f6a7483656972.txt (http://www.saratogian.com/articles/2010/10/07/news/doc4cae3a198f6a7483656972.txt)
NYC OTB union approves deal to slash 550 jobs, give control of account wagering to racetracks
By PAUL POST October 07, 2010 New York City Off Track Betting Corp.’s largest union has approved a deal that would slash more than 500 jobs and see racetracks take over the firm’s account wagering operations.

… Some elements of the reorganization plan, such as changing statutory payments, would be subject to legislative approval. It’s possible the deal could be worked out in the new few weeks.

… However, the biggest obstacle might be harness track owners, led by high-powered New York businessman Jeff Gural, who want an added one percent take on revenue from video gaming be rescinded under the deal.

… Harness tracks also want more free-play vouchers to be allowed at their racinos, a program that’s proven successful at Gural’s Tioga Downs.

… It’s believed that a combination of thoroughbred and harness racetracks would hire an outside firm to run OTB’s account wagering operations. The tracks would own the system on a pro-rated basis, based on the amount of revenue they generate. …http://www.drf.com/news/union-votes-favor-new-york-otb-deal (http://www.drf.com/news/union-votes-favor-new-york-otb-deal)
Union votes in favor of New York OTB deal
By Matt Hegarty 10/07/2010Members of the union representing the majority of New York City Off-Track Betting Corporation’s 1,300 workers have approved an agreement that will provide severance payments to an estimated 550 employees who will be laid off under a proposed reorganization plan, according to the union.

Voting was conducted on the agreement on Wednesday, with 271 members voting to accept the plan and 139 voting to reject it. Under the plan, full-time workers will receive $12,000 in severance pay if they agree to leave the company. ...

[Rico8812]

The problem for Gural is he is much smarter than the people he's going up against. But they have the power.

[Indulto]

http://www.saratogian.com/articles/2010/10/28/news/doc4cc8d85a5659b019999250.txt (http://www.saratogian.com/articles/2010/10/28/news/doc4cc8d85a5659b019999250.txt)
Paterson calls Legislature back to work on reorganizing the bankrupt New York City Off Track Betting Corporation
By PAUL POST October 28, 2010Gov. David Paterson is calling the Legislature back to a special session in November to work on reorganizing the bankrupt New York City Off Track Betting Corporation.

OTB has reached a tentative agreement with its creditors’ committee, including New York Racing Association, but several elements of the plan require legislative approval such as reduced payments to racetracks, along with changes in dark day and hold harmless payments.

… One of the major pieces of the restructuring plan calls for racetracks, including NYRA, to take over OTB’s telephone and Internet wagering systems to satisfy OTB’s debts to the tracks. OTB’s phone and Internet platforms handle about $150 million worth of bets annually. The tracks, collectively, are expected to hire an outside gaming firm to run these systems that they would own on a pro-rated basis, based on the revenue each track produces.

"I think it’ll all get worked out," said John Van Lindt, a former OTB vice president and former New York State Racing and Wagering Board commissioner. "The big question is, what happens to what remains at OTB?"

… the most profitable shops are in Brooklyn and Queens, and will likely suffer a major blow when Aqueduct’s racino starts up next spring.

… The big concern, if the firm folds, is that money now wagered in New York would go to New Jersey and out-of-state account deposit wagering firms such as Youbet and TVG. "It will go to competitors who are circling New York City like vultures," he said.

Assembly racing committee Chairman Gary Pretlow, D-Yonkers, said legislators are still reviewing OTB President Greg Rayburn’s restructuring plan. Pretlow said he has serious reservations about some proposals, such as guaranteeing health benefits for OTB retirees.

"We can’t do that," he said. "That’s something no other bargaining unit in the state has. That’s problematic in itself."

Rayburn says OTB’s restructuring must be finalized by the end of this year, or the firm will run out of cash and stop operating. The special legislative session is scheduled to begin on Monday, Nov. 15, giving lawmakers roughly six weeks to solve a complicated problem that officials at all levels have spent years trying to figure out.http://www.nypost.com/p/news/opinion/editorials/bookies_of_the_living_dead_UovgYfGbHde3X3De15aU
Bookies of the living dead
October 25, 2010As Gov. Paterson last week presented yet another plan to save the long-beleaugered Off-Track Betting Corp., Mayor Bloomber (http://www.nypost.com/t/Michael_Bloomberg)exposed a $200 million deal-breaker that should put the final nail in OTB's coffin.

… But a rightly angry Mayor Mike revealed on Thursday that the plan could put the cash-strapped city on the hook for as much as $200 million in OTB retiree benefits.

That would seem to breach a deal between the city and state.

Three years ago, Hizzoner threatened to close the city-run OTB, rather than keep on covering its losses under a lopsided revenue-sharing scheme with Albany.

Paterson later agreed to take over the operation -- and his office said the state would "assume both [its] assets and the liabilities."

Including, presumably, retiree benefits. …http://saratogian.com/articles/2010/10/28/news/doc4cc9d7e437595993897993.txt (http://saratogian.com/articles/2010/10/28/news/doc4cc9d7e437595993897993.txt)
Work begins on Aqueduct racino, thoroughbred racing and breeding industries already feeling impact
By PAUL POST October 28, 2010… The racino, called Resorts World New York, will be run by Genting New York LLC, an arm of a huge Malaysia-based casino company with worldwide holdings. It already runs several high-profile Asian resorts and is the United Kingdom’s largest casino operator. The firm recently gave the state a $380 million upfront licensing payment and has agreed to cover a $25 million loan to keep NYRA operating until VLTs come on line.

Aqueduct is the company’s first entry into the U.S. gaming market.

"This is one of the proudest days in the history of the Genting organization," Chairman K.T. Lim said.

Gov. David Paterson joined him for groundbreaking ceremonies.

"The addition of the Resorts World New York casino at the historic Aqueduct Race Track will create employment for thousands (2,100) of New Yorkers, help revitalize the state’s racing industry and serve as a powerful generator of state revenue," Paterson said.

… Genting says it will try to highlight Aqueduct’s racing program, rather than having the racino overshadow it, which has happened at many racetrack gaming facilities. Racing’s popularity is on the rise in Asia and Great Britain, where Genting’s other venues are, and it hopes to attract world travelers to Aqueduct as they pass through John F. Kennedy International Airport, bordering the Queens track.

"Every indication is that Genting is committed to have the VLTs operational in or before May and, more importantly, Genting is committed to building a first-class facility that will increase the public’s interest in thoroughbred racing," said Barry Ostrager, New York Thoroughbred Breeders Inc. president. " The positive financial impact the Genting VLT facility will have on thoroughbred racing and breeding in New York will be enormous. Everyone involved in thoroughbred racing and breeding is thrilled about Thursday’s groundbreaking."

[samyn on the green]

For ten years the pols worked the Aqueduct casino for profit It was up for bid about 5 times - we lost count- with each bid drawing contributions and backdoor kickbacks This spanned Pataki to now. It is funny that the news media has finally grabbed a hold of the story to discredit a small time state senator in Westchester where I live. The real big guns are getting away with murder. People like Spitzer should be in jail for what they did to people like Brualio Baeza; ruining someones life so they can profit from this casino. While all this was going on Cuomo let it all happen. Now the idiots will vote for Cuomo in droves because the TV said to do so. I guess now that all the free airplane rides and checks are cashed it is okay to talk about this now.

http://www.lohud.com/article/20101023/N ... ct-scandal (http://www.lohud.com/article/20101023/NEWS05/10230342/Republicans-hammer-Democratic-candidates-over-party-s-ties-to-Aqueduct-scandal)

[badcompany]

"Racing’s popularity is on the rise in Asia and Great Britain, where Genting’s other venues are, and it hopes to attract world travelers to Aqueduct as they pass through John F. Kennedy International Airport, bordering the Queens track."

I know England has low takeouts. Anyone know the takeouts at Asian tracks?

[Spendabuck85]

Here we go again!

From Albany Times Union:
Genting New York LLC, which won the bid to build a racino in Queens, has joined the Oneida Indian Nation in protesting a proposed Paterson administration deal for a tribal casino in the Catskills.

“This decision, and the process that accompanied it, significantly impairs our ability to deliver tax revenue to the state and it greatly reduces our ability to move forward with a planned $1.3 billion dollar investment to build a world class resort,” said Stefan Friedman, spokesman for Gentings’s planned Resorts World New York at the Aqueduct racetrack. “We went through a rigorous, comprehensive review and would expect that same level of scrutiny to apply to everyone across the board.”
http://m.timesunion.com/tu/db_39924/contentdetail.htm?contentguid=iK6e5c72&detailindex=1&pn=0&ps=3&full=true#display

[Indulto]

http://espn.go.com/horse-racing/story/_/id/7494384/future-bright-new-york-racing (http://espn.go.com/horse-racing/story/_/id/7494384/future-bright-new-york-racing)

Future bright for New York racing

By Paul Moran January 23, 2012… Living well on an abundance of crumbs is all too easy. The task of preserving racing's place and raising its profile on this ever changing landscape falls to the New York Racing Association. With prosperity comes the duty to promote aggressively and creatively what, if it is not already, will inevitably become the nation's best racing product, to restore and preserve the long-neglected Belmont facility and bolster its most valuable franchise -- Saratoga. A nonprofit entity has no excuse to not spend every available dollar on capital improvement and promotion. ...

… The NYRA must not stand impassively while New York becomes a larger version of Pennsylvania or West Virginia. The opportunity is at hand to foster a new age of racing in New York, not as gilded perhaps as it once may have been, but nevertheless beyond anything seen here -- or anywhere in America -- in many decades.Hopefully promotion includes lowering takeout.

[Indulto]

http://www.bizjournals.com/albany/morning_call/2012/05/cuomo-nyra.html (http://www.bizjournals.com/albany/morning_call/2012/05/cuomo-nyra.html)

Cuomo aiming to change NYRA

The Business Review by Adam Sichko

May 8, 2012, 6:33am EDT

Gov. Andrew Cuomo said he has begun debating potential legislation to give the state greater control over The New York Racing Association Inc., motivated by an ongoing betting scandal. …

"How do you fix NYRA? How do you increase the public's trust in NYRA?" Cuomo continued. "It seems like there is a never-ending list of the problems at NYRA. It’s not one incident. It’s an incident every couple of months for the past 10 years. At one point, you say, let me find a better way, and I think we’re at the point of trying to find a better way." …It appears that the NY Racing Franchise renewal process is still not complete as the Governor now has the NYRA board of directors in his cross-hairs. If the on-going investigation shows that knowledge of the failure to lower takeout reached the boardroom, these guys are toast, and that could explain why they jettisoned Hayward and Kehoe as quickly as they did.

[Indulto]

http://www.gradeoneracing.com/davidowitz.htm?read=310 (http://www.gradeoneracing.com/davidowitz.htm?read=310)

Betting Thoroughbreds
with Steve Davidowitz

In Defense of Charlie Hayward,
a True Friend to the Racing Fan in New York… At the bottom line---from this vantage point---Charlie Hayward has been used as a target and/or scapegoat on more than one occasion during his tenure while various New York politicians----from state senators to assemblymen and different governors, including the present governor---have sought to capitalize on circumstances they have helped to create, including as stated above, the myriad ploys that led to the prolonged nine years of holding back implementation of the NYRA slot franchise.

[Indulto]

http://www.saratogian.com/articles/2012/05/10/news/doc4fabfcde26cde369841623.txt?viewmode=fullstory (http://www.saratogian.com/articles/2012/05/10/news/doc4fabfcde26cde369841623.txt?viewmode=fullstory)
Source: Gov. Cuomo may change NYRA board
By PAUL POST May 10, 2012… “They (the governor’s office) really don’t like NYRA,” the source said. “They feel it’s a rogue entity. It’s out of control. They’ve forgotten who they work for — people of the state of New York.”

… Cuomo would have preferred getting out of the pact, but realizing the legal difficulty, wants to take control a different way throught the addition of more of his own people to the NYRA board, the source said.

… It’s believed that Chief Operating Officer Ellen McClain is in charge of day-to-day operations since Hayward’s departure, but NYRA has not confirmed this.

Assembly racing committee Chairman J. Gary Pretlow, D-Yonkers, said he believes NYRA fired Hayward and Kehoe quickly, fearing it might lose the franchise without swift action. …
http://www.troyrecord.com/articles/2012/05/10/sports/horseracing/doc4fac9284b4876882321602.txt?viewmode=fullstory (http://www.troyrecord.com/articles/2012/05/10/sports/horseracing/doc4fac9284b4876882321602.txt?viewmode=fullstory)
New York racing at a crossroad
By Nick Kling May 10, 2012… Many would not have given NYRA even a snowball's chance to emerge from the indictment and a bankruptcy unscathed, then get a renewal on the racing franchise it had held since 1955. However, that is exactly what happened. Hayward was a key component of that success.

Nevertheless, there was another side of the coin. Horseplayers who expected Charlie to fight for issues like lower takeout, accurate reporting of equipment changes, and other battleground complaints, were disappointed. In many respects it was business as usual.

… Even if a horse racing person is hired to run the day-to-day show and left alone to do it, the sticky fingers of the political process are sure to extract an increasing percentage of revenue.

There are a lot more voters who want their taxes stabilized than care about whether horsemen get higher purses or backstretch workers get better housing.

Beware.

[Indulto]

http://espn.go.com/blog/new-york/horse-racing/post/_/id/1369/the-nyra-soap-opera-continues (http://espn.go.com/blog/new-york/horse-racing/post/_/id/1369/the-nyra-soap-opera-continues)
The NYRA soap opera continues
By Bob Ehalt May, 12, 2012… when you’re talking about keeping more than $8 million out of the pocket of your customers, pleading ignorance while collecting a $475,000 salary has a hollow ring to it.

When that much money is involved, a boss like Hayward cannot just say “oops” and move on without consequence -- even if it was just an unintentional brain freeze. Confidence in someone’s business skills is difficult to rebuild after a 14-month-long goof.

Moreover Hayward’s cause wasn’t helped by the digs he took at some politicians in a published email …

… The collapse of NYC OTB should be all any patron of the sport in the Big Apple needs to turn a deaf ear to Cuomo. In more cases than not, government agencies and leaders are simply ill-equipped and lack the business savvy to run or oversee a venture that provides entertainment.

… For an entity like NYRA to succeed it needs to have a long range plan that features building a loyal customer base and giving those people a reason to spend their entertainment dollars at a racetrack as opposed to a casino or movie theater. Money needs to be pumped into the business, not just out of it.

… for the fans, NYRA is necessary. Hayward made a big-time mistake, but he cared deeply about the sport and its fans. And right now those fans need someone else in charge who is concerned foremost about catering to them and insuring the future of the racing industry as opposed to focusing on much how much money will be turned over to the State of New York in the next few months.

Despite what some politicians might say, racing does not belong to the state or even the general public. It belongs to those people who follow racing, who wager on it, who buy horses, who spend their lives training, riding, breeding or caring for horses. Without them there would be no revenue stream for the state tax coffers.

To the head of a successful company, that type of business acumen is a no-brainer. Take care of the customer. It’s Rule One. …

[Indulto]

http://www.timesunion.com/opinion/article/Editorial-Another-scandal-another-lesson-3554177.php (http://www.timesunion.com/opinion/article/Editorial-Another-scandal-another-lesson-3554177.php)
Editorial: Another scandal, another lesson
May 12, 2012… Isaac Harkaway's retirement — forced, by his account — followed by a massive rip-off of bettors by NYRA, makes the latest NYRA scandal seem an avoidable one.

… Mr. Harkaway was an examiner for the state Department of Taxation and Finance, and the last of his kind. His job was monitoring tax law compliance at racetracks. He verified the accuracy of the reported handle, the commissions and payouts to the public.

But cost-cutting brought an end to the job in 2010. And days after that, NYRA started breaking the law.

… Another tax examiner whose job was eliminated before Harkaway's, Michael Napolitano, says that if a state watchdog had still been around, the impropriety would have been spotted. …

… NYRA is an example of a choice. Perhaps nixing just one non-essential patronage job to save a truly useful civil service position, like a racetrack examiner, might have made a difference. …
http://saratogian.com/articles/2012/05/12/sports/doc4faf0c369b77b143960158.txt
Horse Racing: Charlie Hayward's legacy more than scandal
By: Michael Veitch May 12, 2012… As the years of his tenure unfolded, Hayward dealt with enormous financial and political pressures surrounding NYRA. Two major ones involved the fight to secure a franchise extension with the state and the millions of dollars owed NYRA by a collapsing New York City Off-Track Betting system.

… NYRA got its franchise and Hayward's response to the NYCOTB situation resulted in strong business gains at Aqueduct and Belmont.

Taking place in a state that for decades has been hostile to NYRA, those issues tested Hayward's skills to the limit.

Charlie, by the way, was more than capable of delivering his own brand of irritation with state officials.

More than once he angered them with a testy response, or no response at all. …

[Ocala Mike]

Wow, my name in the paper again. All I can say is if I get called to testify, it better be during the Saratoga season with all expenses paid!

Ocala Mike, alias Michael Napolitano

[FenceBored]

Wow, my name in the paper again. All I can say is if I get called to testify, it better be during the Saratoga season with all expenses paid!

Ocala Mike, alias Michael Napolitano

And your actual testimony scheduled for a Tuesday.

[Indulto]

http://elmontcivic.com/index.php/civic-news/331-nyra-days-may-be-numbered (http://elmontcivic.com/index.php/civic-news/331-nyra-days-may-be-numbered)
NYRA Days May Be Numbered
Written by Administrator Elmontcivic.com 14 May 2012… It was Vanderbilt, the last head to operate Belmont Park, before NYRA took over, who argued that government controlling horse-racing will be like a "dog chasing its tail." Perhaps horse racing needs to examine itself as a sport again, privatize and allow for investments. Elmont and the surrounding communities truly can't afford losing such real estate revenues and tax relief potential that is endlessly not being met through NYRA. …
http://www.timesunion.com/local/article/Cuomo-s-people-called-Obama-s-people-to-push-3555681.php (http://www.timesunion.com/local/article/Cuomo-s-people-called-Obama-s-people-to-push-3555681.php)
Cuomo's people called Obama's people to push UAlbany over GlobalFoundries
James M. OdatoMay 13, 2012… The New York Racing Association will have a new chairman by the end of September. That much is clear, because under the 2008 deal that gave NYRA a new 25-year franchise, C. Steven Duncker had to be replaced by that date.

… Cuomo is mulling a bill to ban "equine interests" from the board. Since it was created in 1955 as the exclusive operator of New York's top thoroughbred tracks, NYRA's board has always been dominated by horse owners and breeders. If Cuomo acts on the notion of excluding the horsey set, more than half of the current board, including Duncker, would be out. …

[Indulto]

http://www.saratogian.com/articles/2012/05/14/news/doc4fb1a19b2edba336382639.txt (http://www.saratogian.com/articles/2012/05/14/news/doc4fb1a19b2edba336382639.txt)
NYRA names Ellen McClain president, Kenneth Handal general counsel, ethics compliance officer
By PAUL POST and EMILY DONOHUE May 14, 2012The New York Racing Association’s board on Monday named Ellen McClain president of the firm, which has been without a leader since May 3, when Charles Hayward was fired in the wake of an overcharging scandal.

Also on Monday, NYRA hired Kenneth V. Handal as acting general counsel and chief ethics and compliance officer and named him secretary of NYRA’s board. Patrick Kehoe, NYRA’s last general counsel and senior vice president, was also fired May 3.

... After Hayward and Kehoe were terminated, “circumstances changed pretty quickly,” Wait said, leaving McClain one of the most senior members of the organization with less than three months before the start of the Saratoga meet.

In a statement issued Monday morning about Handal’s hiring, McClain said “this is a critical period for New York racing.”

The report, which is preliminary, gives no indication that McClain was aware of the overcharging.

… In a statement issued Monday morning, NYRA called Handal “an expert in corporate ethics and compliance, governance and risk management with almost 40 years of experience as an attorney.”
http://businessofracing.blogspot.com/2012/05/nyra-first-lets-kill-lawyers.html (http://businessofracing.blogspot.com/2012/05/nyra-first-lets-kill-lawyers.html)
NYRA: First, Let's Kill the Lawyers
By Steve Zorn May 1, 2012… Charlie's a very decent guy who's sincerely tried to improve NYRA, but he's repeatedly shown himself to have a tin ear when it comes to anticipating the reaction of state officials, the press and the public. Cases in point: his initial refusal to disclose NYRA's budget and executive salaries to state auditors and the recent bizarre decision to charge low-volume NYRA Rewards phone bet customers $1 a call.

… Under New York's Rules of Professional Conduct for lawyers, an attorney owes his or her client the duty of competent representation. General counsel Kehoe's client is NYRA. By any standards, missing a legal deadline and then mis-reading the relevant statute is something less than competent representation.

So, I guess it's inevitable that Charlie Hayward will be thrown under the bus by those he made look good. But if he's going down, he shouldn't go alone. Pat Kehoe and anyone else in the NYRA counsel's office who gave bad advice should be right there in the next cell.

[Robert Goren]

Why do I get the feeling the job of an ethics compliance officer is to figure out a way to get around being ethical.

[NTamm1215]

Why do I get the feeling the job of an ethics compliance officer is to figure out a way to get around being ethical.

Because you are one of the most cynical, negative, and overly dramatic people in the history of cyberspace. Hey, you asked...

[Robert Goren]

Because you are one of the most cynical, negative, and overly dramatic people in the history of cyberspace. Hey, you asked...You must not be on the internet much.