New York Franchise Award Recommendation May Come Nov. 21

[slewis]

Duh.....


Yes. in my fantasy-hypothetical synopses of of how many of the people on this forum who are pro-spitzer- anti Bruno-pro-NYRA think a hearing involving NYRA vs the People of the State of NY might pan out (or some facimile thereof).

Little Andy wrote me that "there are many" who would argue that NYRA would win this battle if it went into court.
Let me remind you that that Trump and the USFL defeated the NFL... and was awarded $1 in damages. What damages/loses could NYRA claim if the state "took" their land?????? (I.E. Eminient Domain, etc.)
NONE.... there's no-profit / Damages scenario.
Just a group of wealthy racing people who want to "control" their game.
Oh, I'm sorry, like Andy says "They really believe in the good and the future of racing". You know all the good they stand for. Like how they supoena the phone records of Rick Dutrow and catch him red handed calling his assistant while he's under suspension. Sorry Rick, that'll be another $10,000 and another two weeks. Oh by the way, we were going to check Pletcher's records while he was on suspension but, when we called the phone company, they had no record of a Todd Pletcher. Todd would never do such a thing.
You see what I mean when I say, with no oversite, they can, have, and would continue to be an out of control rich-boy club.
Look, this is stupid because it never got to AND NEVER HAD A CHANCE to get to this point. NYRA bluffed it well, and I give their attorneys kudos for getting as sweet a deal as they did. Spitzer and Silver who were once so ANTI NYRA did a 360.
Why? I could only speculate. (by the way, "for the good of racing in NY state is not one of those speculations) I'm thinking more like political backing, contributions, etc. (Ask little Andy how Kenny Noe Jr. got things done with the politicians when he came aboard.)


Now let me address your take out question, like I'm new to racing or something. I am very aware about how the take cycles right back to the state (the more money you give gamblers back, the more they gamble with)

So, here's another NYRA bash...

They come up with this STUPID NYRA reward bull shit. Now tell me, who funds it????? They had to agree to an INCREASE in the take-out in order to implement it. I we ran the track, sheba, we'd tell the stake to F-off.
But no, NYRA takes from Peter to pay Paul, no, let me correct that, NYRA takes a WHOLE BUNCH from peter and only gets to give Paul a little bit.
The rest goes to the State. They advertize that NYRA rewards bull shit like it's GOLD.
The great NYRA management.

[the little guy]

Originally Posted by slewis

So, here's another NYRA bash...

They come up with this STUPID NYRA reward bull shit. Now tell me, who funds it????? They had to agree to an INCREASE in the take-out in order to implement it. I we ran the track, sheba, we'd tell the stake to F-off.
But no, NYRA takes from Peter to pay Paul, no, let me correct that, NYRA takes a WHOLE BUNCH from peter and only gets to give Paul a little bit.
The rest goes to the State. They advertize that NYRA rewards bull shit like it's GOLD.
The great NYRA management.

Surely you are better than that......


.....you know the takeout increase was forced on NYRA by OTB in order to be able to start their rewards program. You know that....so why pretend NYRA increased the takeout in order to fund the rewards program when you know that is simply not true?

[the little guy]

Originally Posted by slewis

By the way.... if you personally know this alysheba guy, tell him who I am, just tell him not to try and pick a fight with me.

Other than you, I think CJ is the only person on this board I actually really know personally.

This is the internet, everybody's a tough guy, but in real life I'll take my chances with you against anyone sight unseen.

[Indulto]

Now that I finally have my computer back I've been able to catch up on my NYRA news surfing.

For DRF subscribers only:
Peace in New York is only temporary
By STEVEN CRIST

…

If you think the mischief and grandstanding are over, though, you're forgetting the mantra of racing in the 21st century: It's all about the slots. It's a tremendous relief that the racing side of things will remain in the hands of a non-profit entity led by people who genuinely like and care about racing, but the Aqueduct casino franchise has yet to be awarded and that's where the real money is.

… The other key unresolved issue involves the state's six offtrack betting corporations, who won a seat on the new NYRA board but whose future was not addressed in the legislation beyond charging the franchise oversight board to "facilitate discussions." Until they are radically restructured, through a merger among themselves or with NYRA, they will continue to be a redundant jobs program for municipal workers and patronage appointees instead of an efficient bet-processing arm of the racing industry. Sometime between now and June, long before the first nickel from a slot machine heads racing's way, the OTBs are going to be pushing hard for new revenue splits that divert money from racing and its customers in order to improve their own bottom lines. Don't bet against them. …

http://www.drf.com/news/article/92334.html
NYRA's Hayward can take a longer view
By DAVID GRENING

… Hayward said that NYRA will shortly start working on other issues, such as the possible merger with or acquisition of New York City Off-Track Betting.

"I think OTB is probably front and center," Hayward said during a wide-ranging interview in his Aqueduct office.

… "The complexity of the problem is greater than what's been represented by the city," Hayward said. "By that, I mean, specifically, they've basically said, 'We're a good operating business that makes a profit, but we have to give too much money to the state.' I think you need to challenge some of those assumptions."

… "Let's talk about account wagering," he said. "Let's talk about Internet and home wagering. Let's talk about the TV show. Let's talk about marketing. It took over 30 years to get us where we are, so a deadline of June 1 to get this completely resolved is not realistic.'

Ray Casey, …, said he was disappointed that his company's financial crisis was not addressed in the franchise legislation, but that he has always favored a stronger alignment between NYRA and OTB.

… Hayward said he believes a merger of many of the state's six offtrack betting corporations and NYRA could be achieved if the parties presented a united front to Albany legislators.

"If the racing association and three or four OTBs showed up and said we'd like to do this, I think they'd be thrilled," he said.

… Hayward said NYRA will soon announce a complete revamping of its player rewards program that will include, at Belmont Park, a hospitality lounge for big players on the second floor of the clubhouse.

"There would be different tiers of not only rewards, but hospitality," Hayward said. …

http://www.saratogian.com/WebApp/appmanager/JRC/BigDaily?_nfpb=true&_pageLabel=pg_article&r21.pgpa th=%2FTST%2FNews%2FState+%7C+Region&r21.content=%2 FTST%2FNews%2FState+%7C+Region%2FHeadlineList_Stor y_1580070
Racing crisis averted
Sides strike deal in the final stretch
By PAUL POST

… NYRA will decide which of its own members stay on board.

… Silver says that Belmont and Aqueduct are too close together and that gaming both places would oversaturate the market.

Bruno countered that argument by pointing to other gaming destinations such as Las Vegas and Atlantic City that have a plethora of highly-profitable casinos. “What could be closer than Foxwoods and Mohegan Sun in Connecticut?” he said. “They are the two most successful casinos in the world and they’re walking distance apart.”

… “I’m delighted that it’s done,” Silver said. “It gives certainty to the workers who work at the tracks. It gives certainty that there will be a source of revenue in the state in terms of building the Aqueduct facility. It also provides, once and for all clearly, the State of New York owns the tracks that are assigned to NYRA by franchise. It is undisputable.

“I think overall this is a great deal.” …

http://www.saratogian.com/WebApp/appmanager/JRC/BigDaily?_nfpb=true&_pageLabel=pg_article&r21.pgpa th=%2FTST%2FNews&r21.content=%2FTST%2FNews%2FTopSt oryList_Story_1580082
Hendrickson named to NYRA board
By BARBARA LOMBARDO

…

John Hendrickson, the husband of philanthropist and horse owner Marylou Whitney, is joining the New York Racing Association board as one of Senate Majority Leader Joseph Bruno’s appointees.

… “There’s no question that the people on the board care about racing. I admire what they’ve done in making New York racing the best in the world,” he said. “However, we have to get the attendance up at Belmont and Aqueduct. They need a better marketing plan.”

… “We have to do a better job conveying to the public that we’re working in their best interest,” he said. “Why not allow the press in to the meetings?”

Marylou Whitney Stables owns more than 70 horses, and the Whitney family has been an integral part of New York racing for more than 100 years. …

Marylou sold her shares in Empire to avoid Spitzer’s integrity check, which all existing NYRA board members went through. Hmmm.

http://www.troyrecord.com/WebApp/appmanager/JRC/BigDaily?_nfpb=true&_pageLabel=pg_article&r21.pgpa th=%2FTRD%2FSports%2FHorse+Racing&r21.content=%2FT RD%2FSports%2FHorse+Racing%2FTopStoryList_Story_15 89400
Let's get back to racing
By Nick Kling

…

The morning line favorite to get the franchise, Empire Racing Associates, made two strategic errors. It's public face consisted of a steady drumbeat about what was bad about NYRA rather than what was good about Empire. The group then embraced Magna Entertainment, Inc. as one of its partners. Magna has successfully offended almost every racing fan in America with its bizarre track management.

Senate Majority Leader Joseph Bruno, who was one of NYRA's harshest critics during the process, seemed to support Magna early on. Bruno praised Magna for developing so-called "family destinations" and "entertainment centers."

Magna's entrance into the franchise contest scared enough New Yorkers that some people began to give NYRA a second look. Ironically, on the day that NYRA and the state agreed to the new franchise terms, Magna was taken to the woodshed by the NASDAQ stock exchange.

… There was one part of the franchise agreement which appeared to be a potential trap. That is a provision which requires NYRA to fulfill so-called "benchmarks," with a four-year review process to assess its progress.

Duncker seemed unconcerned.

"The benchmarks require our best effort to meet them," he said. …

[Pace Cap'n]

.

An official with the New York City Off-Track Betting Corporation said last week's NYRA deal represented the "last straw." The state Legislature approved a deal that extended the 25-year exclusive franchise rights to the New York Racing Association for the operation of Aqueduct, Belmont Park, and Saratoga racetracks. The terms of the deal also called for $105 million in direct state aid to NYRA, the forgiving of about $120 million in past debts to the state, and an end to NYRA's ownership land claims of the three tracks.

..."It looked like every interest in racing got dealt with except for the OTB's," the OTB official said. The official said each year OTB pays out $60 million to Albany that acts as a subsidy for NYRA, and by ignoring the city's desire for a reworked revenue distribution formula with OTB, the legislature was forcing the city's hand to shut down the corporation...

www.nysun.com/article/71422

[Indulto]

http://www.nydailynews.com/news/2008...oval_to-1.html
Mayor Bloomberg's to urge for approval to dismantle city's OTB operation
BY FRANK LOMBARDI

… Bloomberg will go before the Off-Track Betting Corp.'s five-member board of directors - all of whom are mayoral appointees - when the board meets at its Times Square headquarters to vote on a phased-in shutdown plan.

… Board members have signaled their intent to heed the mayor's wish to close OTB.

A veteran OTB executive who requested anonymity said yesterday he's not aware of any previous mayors attending an OTB board session. The closing plan calls for contractual layoff notices to go out April 17 to OTB's 1,500 workers, most of whom are unionized. Layoffs would kick in June 16, as would the closing of 62 betting parlors, three teletheaters and eight restaurant locations. Betting would cease June 15.

Only a few workers would stay on temporarily to sell off assets, such as office equipment and OTB's unexpired rental leases.

… The mayor and OTB officials contend the state has repeatedly heaped more demands on OTB to help the financially troubled New York Racing Association.

… Bloomberg had unsuccessfully asked state officials to fix OTB's money drain while resolving the NYRA's crisis.

http://www.uticaod.com/viewpoints/x565319001
Legislature holds cards on track bet

…

Gambling businesses are not the best form of economic development. Most jobs are low-paying, and racinos or casinos are taking money out of local residents’ pockets without producing anything of value.

… In a broader sense, legislators need to stop betting the house on gambling as an economic engine, and instead put their energy into attracting real business and industry that can promote a healthy, productive economy.

http://paulmoranattheraces.blogspot.com/2008/02/devil-in-details.html
The devil in the details
By Paul Moran

.. . When the state decided a few years ago to enforce an antiquated and long ignored provision of the racing law that prohibits the distribution of admission passes to all except owners with horses entered and politicians, then chairman Barry K. Schwartz and most others expected that this bit of silliness would be quickly rectified. ...

... the prohibition somehow survived the long process of negotiation that became law last week even while charging the group that will oversee NYRA to establish performance benchmarks, one of which is on-site attendance. The lawmakers of New York hold the ludicrous close to the icy political heart, immediately beside self interest, since their own exemption remains in the new law.

... the association paid the appropriate admission tax on every free pass that was redeemed, so the state lost nothing. ...

... Passes, meanwhile, are a useful, time-tested and proven promotional tool. People like free things and every pass redeemed meant that a live body was at the track. ...

...Even among regulars, a bettor who walks through the admission gates for free and losses $200 still feels as though he got something for nothing. A bettor denied that perk, feeling unappreciated may opt for an OTB facility, play from home or not at all.

... This is a time-tested promotional tool that costs government nothing but results in both business and goodwill for every racing association in American except NYRA. ...

[aaron]

The taking away of free admission to NYRA ONE account holders who maintained a balance of $1000.00 in their account has probably caused NYRA a great deal of money in on track handle.
I know many people who withdrew their balances from NYRA accounts,but still bet the NYRA races either thru otb"s or off shore.
While this not NYRA's fault,it shows lack of understanding of the industry by NYRA and the politicians.
It really wasn't even a free pass,because account holders were required to keep a $1000 balance,which offsetted some of the cost of the free admission.

[the little guy]

Originally Posted by aaron

The taking away of free admission to NYRA ONE account holders who maintained a balance of $1000.00 in their account has probably caused NYRA a great deal of money in on track handle.
I know many people who withdrew their balances from NYRA accounts,but still bet the NYRA races either thru otb"s or off shore.
While this not NYRA's fault,it shows lack of understanding of the industry by NYRA and the politicians.
It really wasn't even a free pass,because account holders were required to keep a $1000 balance,which offsetted some of the cost of the free admission.

Aaron, how can you say in one sentence that it wasn't NYRA's fault and yet complete the sentence and say it shows a lack of understanding by NYRA?

They were forced by an overzealous State employee to make this change. They have tried to change it with no success.

[OTM Al]

One has to believe that the NYC OTB at least will finally become merged with the tracks so I really doubt the restaurants and the teletheatres and those storefront shops that are actually making money will close. It was ridiculous that there were OTBs within a couple blocks of Aqueduct, which in essence were direct competitors with the track. This of course all depends on the politicians who have always used the OTB system as patronage jobs.

This would be better all around. The tracks will get the full takeout on their own races, which are the greatest part of OTB betting in many places as well as hopefully eliminating redundant executive salaries and the bettors will no longer have to pay the OTB surcharge on winnings. If it can be done in a business like way rather than a political way, it should be win win for the bettors and the tracks.

[aaron]

TLG-
What I meant by lack of understanding,is that I really don't think NYRA was aware of how much on track handle the taking away of the NYRA One account caused.
With their problem in securing the franchise,I just don't think NYRA ONE accounts were an high priority.

[Pace Cap'n]

Feb. 19 (Bloomberg) -- The board of New York City's Off- Track Betting Corp., the first legal off-site pari-mutuel wagering operation in the U.S., voted today to shut down the business at the urging of Mayor Michael Bloomberg.

Bloomberg, who controls the corporation's five-member board, said in November that the city is facing a $2.7 billion deficit in the coming fiscal year and couldn't afford to inject more money into OTB. He asked Chairman David Cornstein to draft a plan to shut it down.

OTB, which collects more than $1 billion in bets a year, is required by legislative mandates to compensate the racing industry based on gross revenue. In 2006, the business had a $125 million operating profit, yet had to pay the state's racing industry $98 million. City Comptroller William Thompson said OTB might run out of money by June.

``There was ample time, not just weeks or months, but actually years to find a solution to a broken problem, which is horse racing in New York State,'' Cornstein said at the board's monthly meeting today. ``Unfortunately, nothing was done to correct the situation. Instead, the people in Albany decided they were not able to chew gum and walk at the same time.''

With today's vote, OTB will close in June unless state legislators in Albany come up with a plan to save it. City Councilman David I. Weprin, a Democrat from Queens and chairman of the finance committee, said he has introduced a resolution to change the formula to distribute OTB revenue based on net profit rather than gross....

www.bloomberg.com/apps/news?pid=newsarchive&sid=aDQCkETNoa.Y

[PaceAdvantage]

Yeah, like they're just going to let an organization that takes in $1 billion in handle annually just quietly fade into the night. Bullshit!

What are these people smoking that they think anyone is buying these threats? I know, I know, Bloomberg has already said "I'm not bluffing!"

Again, I say bullshit.

[slewis]

Originally Posted by the little guy

Aaron, how can you say in one sentence that it wasn't NYRA's fault and yet complete the sentence and say it shows a lack of understanding by NYRA?

They were forced by an overzealous State employee to make this change. They have tried to change it with no success.

And was that overzealous chump.......Elliot Spitzer by any chance?????

The New hero of NYRA??? I remember Barry Schwartz told a friend of mine that the provision in the statute called for "admission" to be charged but no amount was stated.
Barry said he was going to charge a penny to get in.
Spitzer would have loved that. OOPPS.. Bruno wouldn't have liked either.
(I dont play favorites)

[Indulto]

http://www.nytimes.com/2008/02/20/ny...l?ref=nyregion
OTB Unanimously Approves Plan for a Shutdown in June
By JAMES BARRON

… Officials said two parlors would be closed by the end of February because of real estate pressures.

… Off-Track Betting generates about $125 million in net revenue a year. The racing industry now claims about 70 percent of that money, up from about 55 percent in the mid-1990s.

… Patrick J. Foye, the downstate chairman of the Empire State Development Corporation, said the issues could be resolved by the June closing date. He said that Gov. Eliot Spitzer and the Legislature “are committed to addressing the issues” that OTB faces.

Mr. Foye said in a letter to two OTB officials that its projections indicated that it would fall short “by only $1.1 million in cash in June 2008.” He said that OTB expected July and August to be “cash-positive months,” but that OTB would need about $2.5 million in September.

“Clearly, a long-term solution involving amendment of the state’s racing and wagering laws is required,” he said in the letter, “but in the meantime only $1.1 million is required” to see that Off-Track Betting “endures.”

… “Our emphasis will be on working closely with OTB, the state and the city,” he said. “The state and the city have a common interest in resolving this in a way that does not endanger those 1,500 jobs” and that is consistent with the racetrack deal.

http://www.thoroughbredtimes.com/national-news/2008/February/20/NYC-OTB-closure-would-be-illegal-Spitzer-says.aspx
NYC OTB closure would be illegal, Spitzer says
by Paul Post

… Citing a projected $1.1-million cash shortfall, OTB’s five-member board unanimously approved a closure plan Tuesday that could see the nation’s largest off-track wagering entity cease operations by mid-June.

NYC OTB handles $1.1-billion in wagers annually, but says that a burdensome state-mandated distribution formula is draining the entity of revenues.

“We make money, that’s not the issue,” said Dan Wray, OTB’s director of legislative affairs. “It’s just that we’re being asked to distribute more than we’re making. Our cash reserves are gone. We’re running out of money in June.

… Foye avoided answering questions about where the money would come from to keep NYC OTB viable, saying only that Spitzer’s office would continue discussions with OTB and the city.

He said that a state bailout isn’t needed.

“February is a particularly good cash month [for OTB],” he said. “We believe that will give OTB, the city, and the state legislature time to address these issues.”

Long-term, he said the entire OTB system needs restructuring. NYC OTB is one of six regional OTB corporations across the state, each with its own separate operations that produces costly and inefficient duplication of services, Foye said, adding that OTB needs to partner with NYRA.

“We believe there are significant savings to be realized by having a common tote system between NYRA and the six OTBs,” he said. Currently, OTB and NYRA have separate Internet and phone wagering platforms. These should be melded into one system, Foye said.

http://www.qgazette.com/news/2008/0220/features/020.html
Steinway Street OTB Parlor Closes

… Since 2004, OTB has reduced management positions by 15 percent, cut overall headcount by 14 percent, and closed branches to remain profitable. In 2006, the city Economic Development Corporation hired a consulting firm to perform a six-month study and develop a comprehensive plan to revitalize the New York racing industry. However, the funding formula imposed by the state has not been addressed. Last week, the legislature and the governor agreed to fund a bailout for the New York Racing Association, but ignored the local governments that are responsible for OTB parlors across the state. …

http://majorwager.com/index.cfm?page=27&show_column=631
Don't Order Your Funeral Wreath For New York's OTB Just Yet
By Nelson Lardner

... The target date for the final denouement/last day of betting availability is some four months away, in mid-June. The first of the layoff notifications for some fifteen hundred employees of the enterprise are ticketed to start in eight weeks. This leaves ample elbow-room on the calendar for constructive cashflow manipulation. ...

… That 5% "surcharge" has long been a sticky wicket in discussing OTB's ups and downs. ... Most big players will take considerable pains NOT to play with OTB, if their transactions are such that they're vulnerable to the added bite. It's a testament to the limited options enjoyed by most bettors that OTB handle figures remain as high as they are, in these days of players enjoying access to multiple ways and means of getting bets down without subjecting themselves to such ripoffs. ... Can you imagine OTB wagering levels if they did away with the surcharge? ...

… the settlement of ... the new NYRA deal ... came after plenty of wrangling, because while there has been scant argument about the state owning the racetracks, there had been lengthy, heated debate over whether the state or NYRA owned the land upon which they stood.

… both the state and NYRA would have to feel suicidal, to allow OTB to wither and die, given the jobs created, the millions the operation generates for the state, and for NYRA purse monies.

Pie-in-the-sky answers from Bloomberg's perspective, ... , might include (a) a takeover of OTB by the racing association, an idea which has long had considerable surface merit -- but trust me, the devil's in the details, as the powers presiding over various spheres of influence will certainly come to blows, before this ever happens, or (b) cutting OTB in on a portion of the eventual revenues to be derived by the installation of Video Lottery Terminals (slot machines, to you!) at Aqueduct, in Queens.

Bloomberg's moaning about OTB's having to pay a significant portion of its take to the tracks is significantly out of line. Excuse me . . . the tracks are putting on the show on which you're taking bets, and they deserve their piece of the action, thanks. The mayor's not getting off scot-free on that one. But there's room for debate about the degree of support, and there are multiple ways to iron out the intermediate-term so that current entities may continue to co-exist, without major job losses. …

http://paulmoranattheraces.blogspot.com/2008/02/same-sand-diffferent-line.html
Same sand, diffferent line
By Paul Moran

… The lawmakers of New York blinked last week when faced with a shutdown of racing at Aqueduct and finally fashioned an agreement …
… This week, it stares into the steely eyes of New York City Mayor Michael Bloomberg, who plans to close two city OTB facilities this month and the entire operation in June absent the state’s response to demands for restructuring of an astoundingly unfavorable formula for distribution of revenue.

… Revenue-sharing mandates and formulas imposed by Albany require 120 percent of net profits be paid to the, leaving the city a $14 million shortfall from an organization that is technically profitable. Only Albany could conceive such a plan. ...

… Elected officials, with re-election always foremost on the agenda, are loath to force 1,500 people into unemployment, in this case, many of whom are politically connected and enjoying the largesse of patronage.

… the governing bodies of New York are likely to arrive at some patchwork that satisfies the city’s demand but leaves other shortcomings of the business model to fester unattended until some new crisis presents itself.

… OTB has become an important element of … pari-mutuel wagering, which has migrated steadily off-site in the last three decades in New York. Ideally, it would work best for all concerned were it joined with NYRA’s new not-for-profit model and subsequently streamlined ...

… The New York OTB issue will be settled. Unlike the legislative leaders, Bloomberg actually means what he says and there is no basis for defending the current economic structure. …

http://www.horseraceinsider.com/blog.php/John-Pricci/comments/new-york-city-troubes-tip-of-otb-iceberg/#comments
New York City Troubles Tip of OTB Iceberg
By John Pricci

… if it took Albany years to resolve the franchise situation, the OTB issue is far too complex for a solution to be piggy-backed onto the franchise bill, as some were hoping.

Not that anyone, anywhere, has a clue about how to fix it. ...

… The state should kick back some of the cut it currently gets from the OTBs, a rate that seems to go up every few years. … Last year, New York City received $17-million from NYC-OTB. At the same time, the state got $16-million. … And this outfit now handles a billion dollars a year.

But that’s what can happen when percentages are based on gross revenues, not net. Any company must be allowed to pay their own operating expenses first, yes?

… same problems faced by the tracks; … that walk-up customers are being replaced daily by phone and Internet bettors? …

… That means streamlining and the elimination of duplicate tasks are an imperative. But that would result in a loss of jobs and nobody wants that, especially in a recession. It seems, however, that if downsizing is good enough for the private sector it’s fair that those same principles be applied to government agencies as well.

State Senator Joseph Bruno said recently that the legislature will take on big-picture OTB issues in 2009. The delay surprises no one.

http://www.nydailynews.com/blogs/dailypolitics/2008/02/spitzer-admin-delivers-rebuke.html
Spitzer Admin Delivers Rebuke On OTB
By Elizabeth benjamin

The game of political chicken over NYCOTB continues.

… ESDC Downstate Chairman Pat Foye is challenging the mayor's claim that the city is over-subsidizing the five-borough gambling franchise and sends too much of its proceeds to the state.

… Foye goes on to say that the state will have provided $145 million to sustain horseracing in New York by the end of FY 2008 and will continue to subsidize racing until the VLTs are operational at Aqueduct (in other words: it doesn't have more money to provide to OTB), and also notes that NYCOTB is projected to have a positive cash flow through the end of this year ($7.6 million in the month of January alone).

Bloomberg has accused Gov. Eliot Spitzer and legislative leaders of missing an opportunity to fix the NYCOTB situation when they hammered out a thoroughbred racing franchise last week ...

... But Foye said Spitzer thought it "necessary" due to the "contentious" and "complex" issues surrounding racing in the state to address the NYRA franchise prior to dealing with the OTBs, where business has shifted dramatically from "bricks-and-mortar" to the phone and Internet.

UPDATE: The mayor announced the letter, which also signaled a willingness on the party of the state to reach some sort of agreement on OTB, had arrived while he was delivering his remarks to the OTB board, and said: "The only way you can get Albany to act is create a crisis."

http://paulmoranattheraces.blogspot.com/2008/02/attaboy-joe-follow-money.html
Attaboy, Joe, follow the money
By Paul Moran

… John Hendrickson, the much younger husband of ancient and fabulously wealthy Saratoga Socialite Marylou Whitney, has been officially invited to join the New York Racing Association board as Senate Majority Leader Joseph Bruno’s appointee. Curious choice, but

at least Hendrickson’s attention will not be diverted by a real job. …

[Indulto]

http://www.timesunion.com/AspStories/story.asp?storyID=665768&category=REGION&newsdate= 2/22/2008
Another down year at Capital OTB
Regional betting operation took in $8 million less in 2007; official laments mandates
By CAROL DeMARE

… Compounding the decline are state mandates that cut into funds OTB would otherwise distribute to 16 upstate counties and the city of Schenectady where it operates 43 betting branches and 37 EZ Bet locations. One mandate is an annual $1 million regulatory fee charged to the OTB.

… All six OTB corporations in the state, from New York to Buffalo, suffered losses last year. It was the third consecutive annual decline for Capital OTB.

… "Unlike New York City, we are not losing money," he said. New York City's handle was down $30 million last year. …

… Operating expenses were cut in 2007 for the third straight year to $23.6 million, and payroll was down to $9.1 million last year from $10.4 million in 2002.

"We have the lowest salaries in 20 years because when people left through attrition and other means, we haven't replaced them," Signor said. The work force stands at 323. Capital OTB also has closed unprofitable branches.

'We're trying to run efficiently and with the county taxpayer in mind," Signor said. Capital OTB has a successful phone-a-bet operation and is looking to renovate the teletheater in Albany "to make it more customer friendly and attractive."

… expenses could be cut by streamlining the OTB operation.

"The reality is you can't afford to have six political organizations running off-track betting in New York state. There should be one organization, and it would reduce expenses and have a more professional operation."

… Besides a national decline in track attendance, Signor pointed to "increased competition from racinos and out-of-state Internet sites that are coming into New York (such as Internet poker) and taking bettors away, not just from OTB, but from the tracks as well."

… "We have less of a handle, and we've lowered revenues, but we still have to pay Saratoga Harness at this incredibly high rate, and at the same time they're doing $1 billion in business with VLTs," Signor said. "The policy is ridiculous. Taxpayers are subsidizing a privately owned track."

About four years ago, when OTB took on night-time thoroughbred racing in states such as Pennsylvania and West Virginia, the state decided to protect harness tracks, where racing is also at night. The thinking was, Signor said, "we would have to help subsidize them with the premise that all our handles would go up with night-time thoroughbred racing." But handles didn't go up.

… "The bottom line is all OTBs need state assistance to reverse the policies that have taken millions of dollars from our bottom line," Signor said. "We believe the governor and Legislature will go forward in good faith to try to correct some of these inequities that is taking money away from the counties."

http://www.nytimes.com/2008/02/22/nyregion/22otb.html
If OTB Goes, So Would a Relic of a Grittier City
By COREY KILGANNON

… The Off-Track Betting parlor on Seventh Avenue at 38th Street is a two-story affair, psychically as well as architecturally.

Downstairs is a vast, dingy space with many scruffy characters soliciting change; on Thursday, a man wheeled in a shopping cart full of belongings in plastic bags and placed a bet.

Upstairs, $5 buys admission to the carpeted floors, plush seats, soft lighting and a multitude of simulcast screens; it was standing-room-only at midday …

… “Wherever you have gambling, you’re going to have rich guys and beggars next to each other,” … “And that’s what makes these places unique.”

… The branches began opening in 1971, and each is a prism through which one can see an old neighborhood. As New York City has lost its grit, OTBs have persisted, like exhibits in the Damon Runyon Hustlers’ Hall of Fame, standing sentry against the march of upscale coffee chains, big-name retailers and new condominiums with exercise rooms.

Inside, there is an ever-narrowing slice of New York that still belongs to the hustler and the old timer. To the predominantly male clientele, these parlors are more than just a place to take a chance, they are unofficial social clubs with core groups of regulars.

… A marketing study conducted last year by the Boston Consulting Group shows that the typical customer in a city OTB is a “middle-aged male who bets approximately 12 times a month.” The study breaks the bettors into four categories: OTB whales, OTB regulars, carefree gamblers and social enthusiasts.

The first three groups are all “heavy bettors” who gamble large portions of their incomes, the study says, but the enthusiasts, who, it says, are “focused on social experience,” are singled out as a source of untapped revenue, who should be catered to with better facilities.

The study points to other cities and countries, like France, that have lured younger customers by glamorizing betting and, for example, putting betting windows in trendy cafes.

“Many of our branches are like social clubhouses or gathering places,” said Ira H. Block, general counsel for the city’s OTB operation.

Mr. Block said that OTB did not collect demographic data on customers because bets are anonymous, but that the clientele is typically over 50 and is declining in number, despite OTB’s attempts to attract younger customers.

… The regulars show up, sip coffee, scribble on racing forms and test their hunches at the betting windows or computerized kiosks. With a backdrop of television screens showing races across the country, the customers chat and joke until post time, then spend a minute screaming at a television set together. After each race, the floor gets littered with a fresh batch of losing betting slips.

… “… for a lot of these men, this is their only form of entertainment.”

http://paulmoranattheraces.blogspot.com/2008/02/same-sand-diffferent-line.html
comments:
A friend said...

… I must disagree with your premise that the current distribution formula unfairly discriminates against OTB. In this regard, one of the most onerous taxes since the Boston Tea Party is the surcharge imposed against OTB winnings. It has been advertised as a "5%" tax since its inception over 30 years ago. The reality is that it reaches as high as 50% on some bets. For example, a payoff of $2.40 is reduced to $2.20 under this perverse tax. …

… How does this completely undermine the Bloomberg thesis about OTB? Well, the surcharge robbery is not considered in determining OTB's profitability. Moreover, through an accounting trick, the surcharge payout to the City is treated as an expense against OTB's income. If a legitimate business attempted this trick, it would be charged with RICO violations. So much for the "unfair" OTB distribution formulas.

http://leftatthegate.blogspot.com/2008/02/money-shot.html
The Money Shot
COMMENTS
Anonymous said...

208. 4-a (part of §14 of the bill) provides that “As a condition of franchise acceptance, the franchised corporation shall ... convey the parcel near the aqueduct racetrack that includes blocks 11558 and 11560 of lot 1 in queens county to the new york city public school construction authority should such authority desire and commit to purchase such parcel at fair market value.”

This would seem to permit NYRA to retain that property for the purposes of sale. I guess they can retain the proceeds as they do not seem to be directed anywhere. NYRA can use the other properties, subject to a thirty day relinquishment when the Franchise Oversight Board decides they want them back. (part of §206.1)

http://leftatthegate.blogspot.com/2008/02/un-definitive-and-taking-up-space.html
Un-Definitive and Taking Up Space

… there was an Associated Press story the other day about some parcels of land that NYRA is seeking permission from the bankruptcy court to sell. …

… In documents filed Tuesday with the U.S. Bankruptcy Court in Manhattan, NYRA said that selling the properties could help it maintain its operations, pay administrative expenses related to its bankruptcy case and continue negotiations with the state on a "definitive" settlement agreement.

Brian Rosen, an attorney representing NYRA, said in an interview Wednesday that the definitive settlement agreement is aimed at resolving outstanding litigation and clearing up other issues, such as how the racing association will give up ownership of the racetracks.

I thought they were just going to hand over the deeds! Sounds like a chance for Brian Rosen to add some more hours to the bill. I wonder if the $15 to $20 million that NYRA hopes to gain from the sale will cover their legal expenses?