NYRA Board Gets Optimistic Report From Kay
Optimism was evident May 28 as the board of directors of the New York Racing Association heard president and chief executive officer Chris Kay detail a number of improvements customers can expect on what could be a historic Belmont Stakes (gr. I) day June 7.
Also fueling the optimism was the realization of a number of capital projects at Aqueduct Racetrack.
Kay, meeting with the board in New York City, discussed upgraded dining facilities at Belmont Park, additional seating, and a variety of musical acts June 7 including LL Cool J and Frank Sinatra Jr. Calling the day the "Belmont Stakes Racing Festival" and "New York's spring championships," Kay noted the day's nine stakes—six of them grade I events—will have total purses of $8 million, a record for a non-Breeders' Cup racing day.
A proponent of an enhanced customer experience since taking the helm at NYRA last July, Kay announced last year the search for a "chief experience officer." At Wednesday's meeting, he introduced Lynn LaRocca as the woman hired to fill that position.
A former senior vice president for marketing at Modell's Sporting Goods, LaRocca has also held senior management positions at Bob's Stores, TJX Co., and Paramount Pictures.
"We felt that we needed to have someone who was responsible for every aspect of the relationship we have with our fans and our bettors," Kay said. "The CXO will be responsible for sales, marketing, guest services, and all forms of communication with the public.
"One of the most critical and new elements of this role is how we can use technology and social media to know what our bettors want, to know what our fans want, and then to provide it to them, and to be in constant communication with them."
Also introduced at the meeting was new senior vice president, general counsel, and corporate secretary Joseph Lambert, who comes to NYRA from Unitedlex Corp., where he served as executive managing director and general counsel.
At the beginning of the meeting, board chair David Skorton announced that Jane Rosenthal would be leaving the board of directors. He did not name a replacement.
Skorton himself will be leaving his position as president of Cornell University in June 2015 to become secretary of the Smithsonian Institution. He said that he would remain "seriously engaged" as chair of NYRA's board until then.
Plans for a revamped Belmont Stakes day were well in the works before California Chrome won the Preakness Stakes (gr. I), and Kay said 80% of the seats available were sold before the Kentucky Derby Presented by Yum! Brands (gr. I). While indicating that many $10 general admission tickets remain, he also said it's possible general admission will sell out. He encouraged customers wanting to attend the the June 7 races to purchase tickets ahead of time.
Attributing a decrease in attendance at Aqueduct during the first quarter of this year to unusually harsh winter weather, chief financial officer Susanne Stover reported a 1% increase in pari-mutuel handle from the same period in 2013. It was due, she said, to three additional racing days.
She also reported that over the past three years NYRA has invested $14 million in Aqueduct, including an extensive murals project and the opening of Longshots, the bar and simulcast area that debuted in early April. Upcoming projects will include upgrades to the Manhattan Terrace simulcast and bar on the third floor and the Champs bar on the first floor.
For the first quarter of 2014, NYRA reported gross revenue of $72.27 million, up 3.2% from the first three months of 2013. Net revenue of $36.13 million for the first quarter increased 0.8% from the same period last year. The net loss for the first quarter of 2013 was $1.2 million, according to unaudited financial statements.
Video lottery terminals at Aqueduct generated $28.1 million in revenue for NYRA and its horsemen. However, the association reported a $10.2 million loss on racing operations for the first quarter when VLT revenue to purses isn't included. If that money is included, operating income was $3.39 million in the black.
Ex officio board member Rick Violette, president of the board of the New York Thoroughbred Horsemen's Association, raised a concern about an advance deposit wagering partnership between Churchill Downs Inc. and Finger Lakes Gaming & Racetrack. He characterized it as an "end run" around a 5% surcharge on out-of-state ADWs for bets made by New York State residents.
The proceeds from the 5% fee are split among New York's off-track betting facilities, the state's Thoroughbred and harness tracks, and the state itself.
Saying he was "surprised and disappointed" by the arrangement, Kay acknowledged that it's unclear whether the partnership, approved by the New York State Gaming Commission, can be reversed by the commission or whether legislative action is necessary. He indicated he is in discussions with the gaming commission about the matter.
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