NYRA, Board Strike Temporary Deal

NYRA has a deal to operate racing on a temporary basis after Dec. 31.

With talks going down to the wire, the New York Racing Association has reached an agreement with a state government oversight panel to at least continue running racing on a brief, temporary basis.

The deal calls for the state entity, created two years ago to oversee NYRA finances, to let NYRA be the operator at Aqueduct until Jan. 23, 2008. The current franchise expires Dec. 31.

At that time, the oversight board legally takes control of running racing at NYRA tracks. The board recently said its first choice was to work out a deal with NYRA to let it continue to run racing while franchise negotiations continue.

“NYRA is not commenting on any franchise developments at this time,’’ NYRA president Charles Hayward said Dec. 28.

Errol Cockfield, a spokesman for Gov. Eliot Spitzer, confirmed Dec. 28 that a temporary extension has been reached. But he said the agreement still needs final approval by the New York State Racing and Wagering Board, which is not controlled by Spitzer appointees.

The extension would seem to take some of the urgency off talks under way Dec. 28 at the state Capitol. After a marathon session Dec. 27, all sides were back at it trying to resolve a number of issues.

Senate Republican Majority Leader Joseph Bruno has called for letting an outside entity run NYRA’s simulcasting operation, and also demanded that some of NYRA’s leaders resign as part of a franchise extension deal.

Negotiators for Spitzer were said to be upset with Senate Republicans for refusing to compromise on some matters, according to officials involved in the talks. Bruno also wants to sharply cut--by as much as half--a deal made by Spitzer with NYRA for a 30-year extension.

NYRA officials had expressed openness to a temporary extension, but they raised concerns that a short-term extension could lift some of the pressure off negotiators to strike a deal. They also said NYRA did not want the extension to jeopardize its existing land claims currently pending in its federal bankruptcy court case.

Steven Newman, chairman of the oversight board, confirmed the agreement, which has been signed by lawyers for the oversight board, the state attorney general’s office, and NYRA. He said he is confident the approval will come from the racing board for the temporary extension.

Asked if the agreement could take pressure off negotiators, he said: “You could look at it one of two ways. One is it allows more time and calm for it all to work out or, two, you could look at it the other way: that it lessens the pressure.’’

But Newman said he believes all the sides--given the length of the talks and that they are being led by top negotiators despite the holiday period--are serious about reaching a deal soon. “They wouldn’t be putting in all this time if they didn’t think they were getting somewhere,” he said. “They’re working at this.”

Newman said the temporary extension is necessary even if the sides reach a deal before Dec. 31. That’s because legislative approval of any franchise extension is required, and lawmakers aren’t due back in Albany until Jan. 9.

After talks failed to produce a final deal Dec. 28, the state Racing and Wagering Board scheduled an emergency meeting for Dec. 29 to consider a license application by NYRA to keep racing going until Jan. 23. Unlike other racetracks, NYRA over the years never went to the state agency for a racing application because it was operating under a separate franchise agreement approved by the governor and Legislature.

 While Newman indicated confidence the racing board will approve the license, NYRA officials will be cautiously watching the morning meeting, in part, because the agency's leadership is seen as loyal to Bruno. Spitzer has no appointees on the racing board.

 If the board does not approve NYRA's license application, racing presumably would halt come Jan. 1.

 Meanwhile, if no deal is made before Dec. 31 by state officials, the Spitzer administration, the oversight board, and NYRA already made plans for a possible protracted fight. Documents filed with the bankruptcy court said the sides had reached a deal to extend the memorandum of understanding between NYRA and Spitzer until Mar. 31. The MOU dates back to September, and it is non-binding. Mar. 31 is the final day of the current fiscal year, and some have speculated that if a deal does not come together in the next several days the matter could be dragged into state budget talks next spring.

 After another round of marathon talks Friday, officials reported "significant progress'' in the negotiations, according to a source familiar with the situation. The official said one thing that may have moved along the talks was word that a prominent businessman from Saratoga Springs was taking an advertisement out in a local paper criticizing Bruno for not striking a deal to keep NYRA as the franchise holder.

 An official with knowledge of the talks said the Senate Republican negotiators had backed down on demands that NYRA no longer have control over choosing the tote and simulcasting arrangements for the tracks. Still being discussed, though, were issues pertaining to a "reconstituted'' NYRA board of directors, and the composition of a new oversight board with regulatory powers over NYRA.

 Officials said the agreements reached so far were being shared with NYRA leaders Friday evening.

 No new negotiating sessions were planned yet by officials from Spitzer's office and the Legislature.