All Five Aqueduct Bidders Meet Deadline
All five remaining bidders for the Aqueduct gaming project said they have met a Nov. 6 deadline to guarantee a quick $200-million payment to the state of New York if they are chosen to develop the video lottery terminal casino at the Queens racetrack.
On the evening of Nov. 6, the real estate firm SL Green and its partners, which include Hard Rock Entertainment, informed Gov. David Paterson that they are still in the running. Paterson had told bidders the state, in a last-minute change, was now insisting that to be considered for the project, a guarantee had to be made—with proof to back it up—that at least $200 million would be paid to state government within 30 days of signing the successful memorandum of understanding for the deal.
SL Green and the Hard Rock Entertainment group said it provided proof to the state that it could turn over at least $200 million to the state within the required 30-day window. A spokesman for the group said its overall bid had also been raised from $275 million to $300 million.
Earlier the week of Nov. 2, Las Vegas executive Steve Wynn surprised the state by suddenly pulling out. The company gave no public explanation, but privately said Wynn had grown weary of the process by which New York was selecting an operator for the long-delayed casino, which will feature 4,500 VLTs at the track.
The governor wants the payment assurances so he can count on the money coming in the state’s current fiscal year to help officials close a $3.2-billion budget deficit.
The departure of Wynn has turned the whole bidding process into a new guessing game. SL Green, believed just a month ago to be in head-to-head running with Wynn, was not yet commenting on about its plans, fueling a new round of rumors by its competitors and some state officials. But the other remaining bidders said they had complied with the governor’s new demands for the contract that will give the winner an exclusive, 30-year contract for the Aqueduct casino.
Larry Woolf, chief executive officer of Navegante Group, the gaming operator for the Aqueduct Entertainment bidding group, said his partners assured Paterson they can supply New York with at least $200 million up front “without conditions or caveats.’’ The group’s other partners include Turner Construction and an entity tied to Rev. Floyd Flake, a politically connected former congressman from Queens.
“We also reiterated our commitment to the state that AEG will be open within six months of executing (a memorandum of understanding),’’ Woolf said.
Penn National Gaming Inc., which had earlier promised a $250-million up-front payment, said Nov. 6 it, too, is still in the running.
“We’re currently offering the highest up-front cash payment already at $250 million upon signing, so the $200 million is not an issue for us. It may be for the other bidders,’’ PNGI senior vice president Eric Schippers said.
Delaware North, a Buffalo, N.Y., company that runs racetrack casino and entertainment venues around the country, has met its deadline to guarantee at least $200 million if selected, officials said.
“We continue to believe that the Aqueduct VLT project is a terrific opportunity for the Aqueduct Gaming team,’’ said William Bissett, president of Delaware North Companies Gaming & Entertainment. The Aqueduct Gaming group’s partners include Harrah’s Entertainment and Saratoga Gaming and Raceway.
The Delaware North bid, at $300 million, is the highest offer among the bidders. The company was selected last year by New York to run the Aqueduct casino, but was forced to drop out after the credit crunch made it impossible to raise the $370 million it promised the state in its previous bid.
A group that includes businessman Donahue Peebles and MGM Mirage also said it provided proof to Paterson that the $200 million could be paid within 30 days of the MOU. It said its money is coming without any need for outside financing.
“It remains abundantly clear that the Peebles/MGM Mirage team offers the most effective operator, the most powerful gaming brand, the most comprehensive community benefits, and most reliable path to finalizing this deal with the state,’’ said Frank Marino, a spokesman for the group.
A decision on Aqueduct, first approved for a casino shortly after the 2001 terrorist attacks as a way for the state to raise money through revenue sharing from the gambling proceeds, was due in August. A winner will be selected by Paterson and the two leaders of the state Assembly and Senate; no further authorization by the full legislature is needed.
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