With New York Racing Association officials threatening to seek bankruptcy protection, state officials are rushing to complete a deal by Oct. 30 to get government bailout money flowing to the financially ailing NYRA.
A state panel overseeing NYRA's finances is set to meet late in the afternoon Oct. 30, at which time the release of $19 million could begin. The oversight board has refused to sign off on the funding stream because another state agency, the Lottery Commission, has not yet given final approval to a contract between NYRA and MGM Mirage for construction of a long-stalled casino project at Aqueduct racetrack.
State officials declined to discuss the agenda for Monday's meeting. Scott Reif, a spokesman for the agency, said the details of the session are still being ironed out.
Behind the scenes, though, lawyers for NYRA and the state are involved in heavy negotiations to get a final deal on the VLT project that will then release the $19 million bailout package. The Legislature nearly a year ago approved a $30 million pot of funds for NYRA, which must be re-paid, to help it meet a worsening cash flow situation. So far, $11 million has been released.
The issue has gotten embroiled in the bidding process underway to award a new franchise for the rights to run racing at Aqueduct, Belmont, and Saratoga racetracks. NYRA is competing with two other entities representing a who's who of racing industry individuals and companies. But NYRA has also been making threats that it might litigate over a nasty land claim dispute with the state. NYRA has maintained it owns the tracks while the state has said NYRA's rights to the tracks expire at the end of the franchise on December 31, 2007.
William Nader, a NYRA spokesman, said Oct. 27 that no deal had yet been struck between NYRA and state officials on the $19 million or the VLT contract. "We wish there were, but there's no deal," he said.
Nader said bankruptcy remains a looming possibility. "We're exploring every option, and there aren't many. We're doing everything we can to keep racing in the best position and to protect jobs and purses," he said.
While NYRA's bankruptcy filing has been a weekly speculation in media reports and talk among lobbyists, Nader said no date for the filing has been selected. "We're just trying to hang in there," he said.
"We've maintained all along that bankruptcy is a last alternative."