The New York Racing Association has sent out warning letters to its employees of a possible mass layoff in 60 days. The notices, required under the Workers Adjustment and Retraining Notification Act, provide a two-month advance word to employees possibly affected by layoffs.
State officials are negotiating a loan to NYRA–of between $15 million to $25 million–that has been proposed by Gov. David Paterson. Legislative sources said a deal could be done in time for passage when lawmakers return to Albany May 24. “We’re going to have to do something for NYRA,’’ a source involved in the talks said.
But NYRA officials notified its board May 20 of the WARN notices sent to NYRA employees. “While there have been several articles in the press reporting hope that the state will approval a loan to NYRA so that we can continue operation, this is by no means assured,’’ the letter to the board today stated.
“We are working diligently with all branches of government on funding for the continuation of operations, but feel this step is warranted,’’ the letter to the board said. The letter came from board chairman Steven Duncker, NYRA president Charles Hayward, and board members James Heffernan, Michael Del Giudice, and Stuart Sobotnick.
NYRA on May 21 publicly confirmed the layoff notices, saying it expects to cease racing operations on June 9--and shut down facilities at Aqueduct, Belmont and Saratoga racetracks--unless a fiscal fix is approved at the state Capitol before then. NYRA said the layoff notices were sent to 1,400 employees. It said some of the layoffs can be expected to start as soon as June 9.
NYRA has said it faces a cash flow crisis sometime in June, and Hayward has warned the racing group could face a shutdown the day after the June 5 Belmont Stakes (gr. I). NYRA officials have made the pitch to the state that New York City Off-Track Betting Corp., a state-owned entity, owes NYRA $17 million, and that the state’s failure to get a casino running at Aqueduct by April 2009 kicked in a clause in its 2008 franchise extension that the state would help NYRA if it faced fiscal problems.
Paterson earlier this week said NYRA would not be shut down and that he is confident the Legislature will back his borrowing plan. But the borrowing has already been criticized by at least one group–supporters of state parks, 55 of which have been shut down this week as a result of the state’s fiscal crisis–for helping a racing enterprise at a time when the state is cutting a host of key programs.
Hayward did not immediately respond for comment.
John Sabini, the state's top racing regulator, said a number of different options are still under discussion "to make sure NYRA will continue to operate.''
Sabini, chairman of the state racing and wagering board, said he has been having discussions with NYRA for the past six months about its ongoing financial problems, which he said have been caused, in part, by delays in statutory revenue sharing payments to NYRA and the delay in opening a casino at Aqueduct. A new bidding process has begun for the Aqueduct racino, and the governor expects an operator to be selected by early August.
"I cannot believe they are crying wolf,'' Sabini said of the seriousness of the NYRA situation.