Breeders to Seek $17M for NYRA With Lawsuit
A group of about 10 Thoroughbred breeding farms and the Saratoga County Chamber of Commerce next week will sue the state of New York to try to force it to loan $17 million to the New York Racing Association.
With NYRA facing a looming cash flow crisis, possibly as early as June, officials with the racing entity were counting on a $17 million state loan, which would be paid back from future proceeds from a planned casino at Aqueduct racetrack.
But a broader bill dealing with a bailout of the New York City Off-Track Betting Corp., which included a provision for the $17 million NYRA loan, recently died at the state Capitol. Gov. David Paterson has since proposed a separate bill for the NYRA financing, but the measure has not gone anywhere yet in the Legislature.
“The fear is that NYRA will not have sufficient funds to operate through the end of the year, and possibly through the end of June,’’ said Joseph Dalton, president of the Saratoga chamber group.
Spearheading the effort on behalf of breeders is Joe McMahon of McMahon of Saratoga Thoroughbreds, one of the state’s largest breeding operations. He has lined up about 10 other breeding farm owners to sign onto the lawsuit as plaintiffs, which is expected to be filed next week, likely in state Supreme Court.
Dalton said the state promised, when it extended NYRA’s operational franchise for Aqueduct, Belmont, and Saratoga, to provide financial assistance to NYRA if a racino was not opened at Aqueduct by April 1, 2009. Racetrack casinos were first approved for New York in 2001, but the Aqueduct project has been stalled by a number of legal, financial, and political hurdles over the years. The state is now set to begin its fourth separate bidding process that has spanned three gubernatorial administrations.
Dalton said NYRA is losing $3 million a month without the Aqueduct casino, money that was to have been shared with purses.
“That delay has affected the breeding industry,’’ Dalton said.
Owners who in the past stayed in New York are more and more taking their horses to other states with higher purses at tracks with casinos.
“The state racing and breeding industry has been decimated. If you are a horse owner, you’re going to follow the money and the money is not in New York state,’’ Dalton said.
Legislators have said they are awaiting a financial recovery plan by the NYCOTB, which owes NYRA $15 million in back payments, before considering the $17 million loan for NYRA. The NYRA board last week met to hear several possible time periods for NYRA running out of cash to fund its operations, with the worst case scenario coming in June.
The lawsuit will include a group of breeders whose operations produced 75% of the mares bred in the state.
"The racing industry as a whole has waited as long as we possibly could,'' McMahon said in a statement. "We're on the edge of a precipice. It's time for action and a new course needed to be taken.''
Farms taking part in the lawsuit include Berkshire Stud, Chestertown Farm, Dutchess Views Farm, Empire Stud, Gallagher's Stud, Hidden Lake Farm, Highcliff Farm, Milfer Farm, Mill Creek Farm, Sequel Stallions at Keane Stud, Sugar Maple Farm, and Waldorf Farm.
Copyright © 2013 The Blood-Horse, Inc. All Rights Reserved.