Optimism Abounds in New York Thanks to VLTs
Legislators, regulators, and racetrack executives are expressing growing optimism about the state of the horse racing in New York. Some might even say with a bit of Empire State brashness.
“If you don’t think we’re doing well here in New York, ask the folks in Kentucky, because they’re all crying," said John Sabini, chairman of the New York State Racing and Wagering Board.
What was only talk of gloom and doom a year ago has, thanks in large part to the growth of video lottery terminal operations, including the new Aqueduct casino, suddenly turned a corner. Whether the rhetoric can keep up with industry realities, however, is a major question for New York officials, especially as the state eyes a major expansion of casino gambling.
Still, for now, one top track executive, after years of red-ink discussions, appears to be enjoying the new confidence.
“The resurgence is really just starting after some years of frustration waiting for the VLTs to get going," New York Racing Association president Charles Hayward said.
The officials made the remarks during a March 1 Senate hearing called to consider a plan by Gov. Andrew Cuomo to merge a number of entities including the NYSRWB, Lottery Division, and several breeding funds under a single state agency charged with regulating and overseeing everything from charitable gambling and Indian casinos to racetrack operations.
But the hearing, which aired concerns raised by public employee unions about the merger and support from NYRA, partly shifted into a broader discussion of the health of the equine industry in New York.
Hayward said there is suddenly a “renaissance" in the state’s breeding industry, with breeders' awards for horses winning races in New York expected to rise from $10.5 million last year to $20 million by next year. He credited the expected flow of revenue from the new Aqueduct casino for much of the growth.
Hayward said the Thoroughbred racing and breeding industry in New York is “finally turning around," in part by the VLT growth and an increase in NYRA’s ontrack and advance deposit wagering net revenue increase since the closure more than a year ago of New York City Off-Track Betting Corp. NYRA is making a play to expand its offtrack betting operations into restaurants and bars in New York City.
Hayward lamented the industry’s decline after the state first approved VLTs in 2001 and investors rushed to purchase farms. But delays--it took 10 years for the Aqueduct casino to open--coupled with an overall decline in the industry contributed to New York losing almost 100 horse farms between 2005 until the end of 2009.
While Hayward also talked of the battering of the Kentucky horse industry, he said New York in the past nine months has seen a number of new farms reopen, including the expansion of Kentucky-based Vinery into New York.
The foal crop in New York, he said, topped out at about 2,500 in 2005. It is expected, he told lawmakers, to be down to about 1,700 this year. But then, he said, expectations are that portion of the industry will “start increasingly dramatically."
Hayward touted NYRA’s announcement for a sharp purse increase at Belmont Park and Saratoga. “We’re trending much stronger than a number of the other states," he said.
The NYRA chief also used the hearing to make a pitch to keep racing at Aqueduct. Plans by Genting New York and the Cuomo administration to construct the world’s largest convention center--along with the addition of a full-fledged casino--on the grounds of Aqueduct has renewed long-simmering speculation that the Queens track might not be needed in the future, especially with Belmont located just nine miles away.
But Hayward called the current racing configuration “very sustainable." He said he has not held any talks with the Cuomo administration about Aqueduct’s future, but noted the current development plans do envision racing continuing at Aqueduct.
“We think it’s a very good circuit right now," Hayward said of NYRA’s annual schedule of racing at its three tracks. “I think it serves us well."
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