AEG skips auction for Aqueduct VLTs – QNS.com

AEG skips auction for Aqueduct VLTs

State Lottery director Gordon Medenica explains the process of picking the new bidder for the Aqueduct racino project. Photo by Ivan Pereira
By Ivan Pereira

The state Lottery Division was on hand at Aqueduct Tuesday to lay out the points for six contenders in the new round to select a developer for the much-delayed plans to install video lottery terminals at the race track. Aqueduct Entertainment Group, which was awarded the VLT contract before the agency deemed the group unlicensable, will not be a bidder this time around.

Gordon Medenica, director of the Lottery Division, and several of his fellow administrators answered questions to nearly 60 representatives from the six groups on how the state will evaluate their request for proposals for the project, which are due by 4 p.m. June 29.

A $1 million entry fee to participate in the mandatory bidders’ conference Tuesday was due June 1.

The Lottery said six groups — Genting NY LLC, Empire City Casino at Yonkers Raceway, Penn National Gaming, SL Green, Delaware North and Clairvest Group, which previously partnered with AEG in the last round of bidding — paid the entry fee.

AEG, which was deemed unlicensable by the Lottery, was not part of the process.

The RFP had to be reissued after AEG was eliminated earlier this year when questions arose over the group’s investors, including the politically powerful former congressman the Rev. Floyd Flake from southeast Queens.

Medenica said one of the new rules in this round of the RFP mandates that all investors in the developer’s group be identified in the paperwork.

“We need to know all names involved,” he said.

Medenica and his colleagues went over how they would name the group for recommendation to the governor, who will ultimately choose the developer. Lottery will look at the experience of the organization in creating similar gaming venues and if it has the finances to properly construct the project in a timely manner.

It will also examine the developer’s capital plan — specifically its spending level — and the quality of the facility. Medenica said it will analyze the developer’s marketing plan and if its contracts to minority and women-owned businesses constitute 25 percent of the construction and operational phases.

Lottery will make its recommendation Aug. 3, according to Medenica.

Representatives from the bidders asked the state representatives about Lottery’s rule that the winning developer make a minimum $300 million, non-refundable, upfront payment once selected.

Bill Murray, deputy director and general counselor for the Lottery Division, said the request for the money was done to ensure that the group has a firm commitment to the project.

“If the bidder does something that prevents the process from not moving forward … it is appropriate,” he said.

Murray added that the state will not disclose further details of its selection process to the public.

Reach reporter Ivan Pereira by e-mail at ipereira@cnglocal.com or by phone at 718-260-4546.

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