On Wednesday, the New York Racing Association (NYRA) responded to criticism about its Monday appointment of Ellen McCalin as president and Kenneth Handal as secretary by issuing the following statement:
The New York Racing Association board of directors exercised its business judgment as a private, not-for-profit corporation to appoint a president and secretary. These appointments were made to stay in compliance with NYRA's Bylaws, Article VII, Section 7.01.
NYRA's board acted to insure that there was professional management in place to operate a complex business which has a significant economic impact on New York State. The NYRA board has a fiduciary obligation to exercise its business judgment to protect the best interests of racing and the income stream that pari-mutuel wagering provides to the state.
On May 1, 2012, Racing and Wagering Board Chairman John Sabini sent a letter to the NYRA board of directors, which stated "...it is imperative that you provide an interim operational plan to the board, especially who will be performing functions as chief executive officer and counsel." This letter contained no indication of any concerns or limitations with respect to these appointments. The NYRA board acted to name a president and secretary without any knowledge of any concerns by either the Franchise Oversight Board or the Racing and Wagering Board.
Furthermore, neither the Racing and Wagering Board nor the Franchise Oversight Board has authority over the naming of officers by the NYRA board of directors.
The suggestion in the May 15, 2012, letter from Chairman Sabini and Chairman Megna that the NYRA board and other NYRA executives have a potential role in the improper take-out investigation, thereby making the NYRA board's action inappropriate, is flawed. This reasoning would effectively paralyze the corporation based on innuendo. The Inspector General's investigation is ongoing and there should not be a rush to judgment until a final report is issued, and due process is provided.