State Fails to Approve NYRA Deal

But New York racing may continue after Dec. 31 despite the latest setback

At an emergency meeting Dec. 29, state racing regulators failed to approve a temporary license for the New York Racing Association to continue racing in January while talks about a permanent franchise deal continue.

The state Racing and Wagering Board said it did not have to act on the request by NYRA because another state agency created to oversee NYRA has the authority to run racing once NYRA’s current franchise expires Dec. 31.

The continued muddled ways of the situation leaves it still uncertain whether racing will continue next week if a broader, permanent franchise deal fails to be reached by Gov. Eliot Spitzer and legislative leaders.

After the meeting, Senate Majority Leader Joseph Bruno confirmed that he has relaxed some of his previous demands, including his longstanding insistence that NYRA relinquish to an outside company such things as its simulcasting business. The Blood-Horse reported Dec. 28 that Bruno’s negotiators in closed-door talks had dropped several demands.

Bruno, in an interview with a cable television show run by Capital District Off-Track Betting Corp., sounded optimistic that a permanent deal allowing NYRA to maintain the franchise will be reached by Dec. 31. It would still need legislative approval, which would not occur until after Jan. 9 when state lawmakers return for their 2008 session.

Bruno also appeared to drop demands that Belmont be permitted to open a VLT casino, and he hinted in the interview that top NYRA officials would not have to resign – as he had been demanding for several weeks.

Bruno, under mounting pressure by Saratoga Springs business interests concerned about next summer’s meet, did continue his opposition to a 30-year extension for NYRA, a time period NYRA and Spitzer agreed to in September. “What’s magic about 30 years?’’ he said. He added the franchise would be for at least 20 years.

Bruno said there would be beefed up oversight of NYRA during set timetables to see if certain benchmarks are being accomplished, and that the board would be “reconstituted.’’ He did not elaborate. The sides have already agreed the NYRA board would be reduced from its present 28-member size.

But NYRA Chairman Charles Hayward, who followed Bruno on the show, said he did not share the lawmaker’s optimism about the negotiations. He said there were some “substantial’’ issues still outstanding; he did not name them and Hayward did not immediately return calls for comment.

Concerned about the pace of negotiations, NYRA, a state oversight board and the attorney general’s office, agreed on a deal permitting NYRA to continue racing until Jan. 23. But it called for NYRA obtaining a license from the state Racing and Wagering Board for the temporary period.

“We determined that we don’t have to take any action,’’ said Daniel Toomey, a spokesman for the agency. He said the agency believes racing can continue because the law permits the state agency overseeing NYRA’s finances to take over racing once the current franchise expires Dec. 31. The oversight board can then permit NYRA – or presumably another entity – to actually conduct the racing during the temporary period.

Toomey said that since the oversight board is a state agency it does not need to get a racing license from the regulatory agency. He said the board’s inaction on approving a license for NYRA does not mean racing has to stop on Jan. 1. “We just want to make sure racing goes forward,’’ he said.

NYRA’s competitors in the franchise battle believe the issue will drag into January, and some believe it could be wrapped up in next spring’s state budget talks.

“We still feel that we’ve got the right proposal for racing for New York and we’ll continue to press our case as long as it’s still not approved,’’ said Karl O’Farrell, head of Capital Play, an Australian-based group of racing, gambling and real estate companies.