After years of dipping into purse accounts to meet expenses, the New York Racing Association has, under pressure from horsemen, opened a new account that will be solely for maintaining purse winnings.
The move comes after it was revealed earlier this year the NYRA had run up a tab of $14 million against the purse account, a level that Richard Bomze, president of the 5,000-member New York Thoroughbred Horsemen's Association, said has grown to $20 million.
As of Nov. 6, Bomze said, all purse money has been going into a new account that NYRA has promised will be used for nothing else but horsemen winnings.
"It will be a separate account to be used for anything else. They can't use it to pay the electricity,'' Bomze said.
NYRA officials were not immediately available for comment.
While the new account was created, a key question remains: when will the horsemen get the estimated $20 million NYRA has already spent from the purse fund?
Bomze said horsemen, who will discuss the matter Nov. 22 at Aqueduct as part of an annual meeting, are willing to be patient because they understand NYRA does not have the cash on hand right now.
"They've got to pay it back. Come hell or high water, we're going to get our money. But if they go bankrupt the horsemen will be on the bottom of a long list of creditors. Hell, we'll be behind the hot dog man,'' Bomze said.
Bomze said NYRA officials have assured horsemen the money will be re-paid and added NYRA should jump-start its VLT program, now on hold because of ongoing criminal investigations by federal prosecutors, and use part of the VLT proceeds over the coming years to pay off the purse fund debt.
"Just don't spend it on salaries or for leasing cars or whatever they spend their money on,'' Bomze said.
"But we're not insisting on the money now because it would put them in real financial trouble. I want them to survive. I don't care about the money right now because every horseman doesn't tap out their account when they win...The bleeding is stopped. We have very strict oversight whenever we want it. The next step is to get our money back without destroying NYRA, so we're looking at a slow payback.''
Alan Foreman, a lawyer for the horsemen's group, said the Nov. 22 horsemen's meeting at Aqueduct is to provide an update into the purse account situation.
"We've been working with NYRA cooperatively to try to resolve the situation. They've got enough problems,'' he said. "They have been working with us. We obviously solved part of the problem by creating a separate account for the horsemen. The far more difficult problem to resolve is the liability ... and that has not been resolved.''