New York Governor Still Undecided Concerning Future of Racing Franchise

New York Gov. Eliot Spitzer has not decided on any one plan for the state's Thoroughbred racing franchise, but a slew of ideas from "shutting down Aqueduct to splitting up the franchise" have been discussed.

A senior advisor to New York Gov. Eliot Spitzer said the governor has not decided on any one plan for the state’s Thoroughbred racing franchise, but acknowledged that a slew of ideas – from shutting down Aqueduct to splitting up the franchise – have been on the table.

In his first public remarks on the franchise situation, Richard Rifkin, the special counsel to Spitzer who is overseeing the administration’s deliberations for the future of racing, insisted the governor’s first priority is to try to improve the state of the Thoroughbred industry in New York.

“The governor’s goal is to come out with a result where racing is going to be a major and successful industry in this state,’’ Rifkin told reporters after appearing at an Albany Law School symposium in Saratoga.

The remarks by the governor’s lawyer came as a deadline was occurring Aug. 7 for the four bidders interested in running the Aqueduct, Belmont, and Saratoga tracks to submit any final plans – and changes in partners or other structures – in anticipation of Spitzer making his recommendation on the franchise on or before Sept. 4.

Rifkin defended against criticisms by some industry insiders that the administration has been taking too long to make its decision and that it has been floating a number of ideas long ago discarded as unworkable. Rifkin said the situation became more fluid after MGM Mirage dropped out as the New York Racing Association’s partner to develop a casino at Aqueduct. Then, he noted, other bidders saw partners come and go, necessitating the new Aug. 7 deadline for a final submission from the bidding groups.

The Spitzer advisor also insisted that plans surfacing in the press in recent months have not been settled on by the governor. He called it “frustrating’’ to read about ideas portrayed as agreed to by the governor that he said “raised unintended consequences.’’ He said no final decision on any matter involving the franchise has been reached.

But Rifkin did say Spitzer asked about the idea of closing Aqueduct and whether it “makes sense’’ to have two downstate tracks operating 10 miles apart from each other.

The Blood-Horse has reported Spitzer was looking into a plan that would involve closing Aqueduct and either selling all of it off to developers or keeping part of it for a VLT casino. The idea also included the winterization of Belmont. Another idea Rifkin himself floated to bidders was splitting the franchise into two components: one for racing and the other for gambling and real estate development. Aides have said the governor has also warmed up to letting NYRA continue running racing while giving Excelsior Racing Associates the non-racing side of the franchise.

Rifkin said the administration is also still considering whether to back a plan to expand VLTs to Belmont. “Maybe yes, maybe no,’’ he said.

Rifkin did not commit the administration to any of the ideas. “There is no governor’s plan,’’ he said.

The Spitzer lawyer also said the administration has been looking at what to do about the state’s off-track betting industry – long criticized as an impediment to growth by racetracks. “OTBs are clearly a major problem in terms of the structure we have today,’’ Rifkin told the Albany Law School audience of lawyers, lobbyists, and industry executives gathered on a dark day at the Saratoga track.

In a later interview, Rifkin said the problems of the OTBs have been identified but that the “solution is much harder to find.’’ He blamed the complexities of the racing law in New York, changes in the industry “and yes, the politics are very difficult.’’ The OTBs, created to drive a share of betting dollars to local governments, have also been a source of great political patronage over the years for Republicans and Democrats.

Rifkin said he had not yet seen any of the final changes or ideas by the four bidding groups that were due to be sent to his office later in the day.

In its final filing with the state Aug. 7, NYRA was not expected to make any major changes, a source said.

Empire Racing Associates, whose partners include Woodbine, Churchill, and Magna Entertainment, was going to float an idea in which the state would create a government-run agency of some kind to pick a operator – much as it does in its park system for various work – to run the racetracks.

“We’re focused on a solution that’s passable, that works for the industry and reflects the priority of the decision makers,’’ said Jeff Perlee, Empire’s chief executive officer.

Carl O’Farrell, president of Australian-based Capital Play, said his group is adding Exell Development, a Manhattan real estate partner, to its bid, as well as the Victoria Racing Club.

Officials at Excelsior, which has already seen dramatic changes in its structure, could not be reached for immediate comment.