Four months after Governor David Paterson announced a Buffalo company would bring casino-style gaming to Aqueduct Race Track in Ozone Park – and send a $370 million shot of cash to Albany – the deal still is not closed.
The up-front payment is not due until Buffalo-based Delaware North Companies and the state sign a “Memorandum of Understanding” and there are problems with the deal, according to a company spokesperson.
“The terms aren’t changed – we’re restructuring the financing because of the state of the markets,” said Glen White. “This is a very complex deal, and lenders have had a severe financial outfall in the last few months,” he explained.
“We’re very confident that everything will come together fine,” White added.
Local officials are not so confident.
“I’m just frustrated, and so is the community,” said Assemblymember Audrey Pheffer, whose district includes the track.
Among the benefits to the community, the deal involved some 1,200 jobs in Queens, many of which were promised to local residents in meetings between Delaware North and residents.
Construction was expected to begin as early as January on the entertainment complex that would include a hotel, restaurants and shops – and 4,500 Video Lottery Terminals (VLTs), projected to bring $1 million-a-day in “revenue sharing payments.”
In addition to the $370 million down payment, the company was to finance a $150 million hotel and conference center. These are the deals being restructured, according to White. “We’re a $5 billion company. Our financial strength has been illustrated and fully vetted as part of the process,” he said.
State bonds are to be issued to finance the $250 million VLT facility. But the state hasn’t moved to issue the bonds – because the final memorandum isn’t signed.
Before that can happen, there are several other issues still to be resolved.
There is still no “joint utilization permit” with the New York Racing Association that actually runs the track, defining their territory and roles.
A required State Environmental Quality Review has not been completed. No construction can begin until the state’s Department of Environmental Conservation signs off on the review.
As part of this process, a traffic study would be approved by the city’s Department of Transportation (DOT). The study would be conducted by an outside company. The test itself has to be negotiated with DOT.
“We were scheduled to have a meeting with their consultant and other city agencies, but someone couldn’t make it – we rescheduled to the week of February 20,” said Craig Chin, a DOT spokesperson. Chin could not say how long the process would take.
Another potential stumbling block has nothing to do with paperwork.
“As was clearly stated in our proposal, the project requires market protection from development of VLTs at nearby Belmont Park,” White said.
The state’s economic woes have led to renewed calls for a competitive facility at Belmont, especially from Nassau County legislators, led by the Senate Minority Leader, Republican Dean Skelos, whose district includes Belmont Park.
Nevertheless, both Delaware North and Paterson’s office are confident the issues will be resolved, though both described hammering out the final details as “a very complex process,” in similar statements.
“Despite the work remaining to be completed, we are pleased with the progress that is being made and look forward to beginning construction of the project in 2009. We project completion in 12 to 14 months,” White said.
“We look forward to the start of construction in 2009. We anticipate the gaming/restaurants/parking phase can be completed within 12 to 14 months from the start of construction and this timeline remains unchanged,” said Paterson spokesperson Marissa Shorenstein.
