It seems like a race with no finish.
The saga of the long-delayed award of the Racino franchise at Aqueduct, the tottering New York Racing Association (NYRA) and the city’s bankrupt Off-Track Betting (NYCOTB) operation continues to add enough volumes to put an encyclopedia to shame.
New York State Lottery officials, lawyers for jilted winner Aqueduct Entertainment Corp. (AEC), and other interested parties are due in a Schenectady court on Thursday, July 29.
At issue is whether Judge Barry Keller will allow the Lottery to pass judgment on the only currently-approved Racino bidder, Genting NY LLC – or order the Lottery to reinstate AEC as the winner to operate 4,500 Video Lottery Terminals (VLTs) at the track – or something else.
A source close to the Lottery expressed confidence that Keller would dismiss AEC’s action, intimating that the reason for delay was that “AEC filed their papers just moments before the hearing [on Friday, July 23].”
At the same time, SL Green, recently rejected by the Lottery, continues to hold out the prospect of filing a lawsuit – if the state does not call a “do over” on the current bidding process.
In the meantime, NYRA opened the longest racing meet in over a century – 40 days – at Saratoga on Friday, July 23. It remains NYRA’s cash cow, with an average daily attendance of 25,000 – five times that of local tracks Aqueduct and Belmont.
Several races were removed from the Belmont schedule and moved to Saratoga, generating an extra $3 million, according to reports.
On Monday, July 12, State Comptroller Thomas DiNapoli issued a critical report saying NYRA “is facing financial insolvency in 2011” if Aqueduct VLT revenues “fail to materialize and expenses are not curtailed.”
The report says that since emerging from bankruptcy in 2008, NYRA continued to run at a loss instead of restructuring – losing $8.9 million in 2009 and is projected to lose $19 million this year.
DiNapoli pointed to $30 million in lost revenue from VLTs and $17 million owed by OTB as adding to NYRA’s woes, saying, “The fact is, NYRA can’t make it long without significant restructuring and revenues from VLTs.”
But he questioned NYRA’s $1.9 million increase in payroll, “$6 million on contracts for personal and miscellaneous services,” and $900,000 in free horse transportation for owners since 2008.
DiNapoli was also critical of the current Racino process, saying, “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.”
