State picks Genting NY for Aqueduct VLTs

State picks Genting NY for Aqueduct VLTs
Genting NY LLC’s plans for Aqueduct were endorsed by the state Lottery Division. All that awaits is approval from Gov. David Paterson and legislative leaders. Photo courtesy Genting NY LLC
By Howard Koplowitz

The state Lottery Division recommended Tuesday that Genting NY LLC be given the contract to install video lottery terminals at Aqueduct Race Track, saying the company’s plan “was impressive on many levels.”

Genting, a subsidiary of the Malaysian-based Genting Malaysia Berhad, was the sole contender for the contract after the Lottery disqualified bidders SL Green and Penn National Gaming last month.

Genting would need Gov. David Paterson, who previously said he would honor the Lottery’s decision, and legislative leaders to approve the Lottery’s recommendation in order for the deal to be consummated.

In a letter to Paterson, Lottery Director Gordon Medenica said Genting is “a vastly experienced and professional gaming company and their proposal reflects a deep and insightful understanding of the opportunity and challenges of Aqueduct.”

Genting’s plans include 4,500 VLTs, a two-story food court, a Chinese restaurant, entertainment space and a 75-foot-tall indoor water show.

Genting could not immediately be reached for comment.

While Genting wound up as the only company in the running for the contract, the Lottery could have chosen not to endorse its plans and call for another round of bidding.

“Genting took nothing for granted — they respected the very rigorous selection process that we developed after the missteps of the past,” Medenica said.

He was referring to the collapse of a deal between the state and Buffalo-based Delaware North in 2007, which fell through after the company could not deliver the $370 million upfront payment it promised the state.

Earlier this year, Aqueduct Entertainment Group was selected for the contract, but the Lottery refused to give the consortium a gaming license.

AEG was scrutinized because one of its investors was influential southeast Queens minister the Rev. Floyd Flake, who had a 0.06 percent interest in the company.

Three days after AEG was selected for the contract, Flake met with Paterson, leading to speculation that the deal was politically motivated.

But Flake backed out of AEG and Paterson announced he would drop his election campaign, although the Aqueduct selection process was not cited by the governor for his decision.

The state required at least a $300 million licensing fee be paid by the winning bidder. Genting offered a $380 million upfront payment to the state, the Lottery said.

“It is with genuine enthusiasm that the [Lottery evaluation] committee unanimously recommends Genting New York as the winning vendor,” Medenica wrote.

He said Genting was “highly sensitive to the community issues, labor requirements and social concerns that a project of such scope encompasses.”

Genting held a public hearing at Aqueduct last month to give residents near the track access to its plans and address any problems neighbors may have had with its plans.

Reach reporter Howard Koplowitz by e-mail at hkoplowitz@cnglocal.com or by phone at 718-260-4573.

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