Ray Paulick<br>Editor-in-Chief

Ray Paulick

Franchise Fracas

Over the next few weeks, the contenders and pretenders angling for the right to operate the New York Thoroughbred racing franchise at Aqueduct, Belmont Park, and Saratoga will be finalizing their paperwork in the request for proposal process developed by the Ad Hoc Committee on the Future of Racing.

The RFPs are due Aug. 29, with the committee to make its recommendations one month later. Sixteen entities have expressed an interest to run the franchise, including the New York Racing Association, whose license for the franchise expires Dec. 31, 2007.

NYRA, along with other current racetrack companies Churchill Downs Inc. and Magna Entertainment, are serious contenders. So is the newly formed Empire Racing Associates, a partnership that includes numerous New York owners and breeders; Delaware North Companies, whose properties include Finger Lakes racetrack in New York; and Woodbine Entertainment Group, which operates Woodbine racetrack near Toronto, Canada.

Two interested parties that should be respected are affiliated with massive casino companies: Steve Wynn-controlled LRW Development and MGM Grand, which has been a partner with NYRA on the yet-to-be-opened video-lottery terminal parlor at Aqueduct. The most interesting wild card is Excelsior Racing Associates, whose partners include a former adviser to casino mogul and real estate developer Donald Trump, former jockey Jerry Bailey, and Steve Swindal, son-in-law of New York Yankees owner George Steinbrenner.

Because the New York legislature failed to act on recommendations made in 2005 by the public policy group Friends of New York Racing, the RFP gives bidders the opportunity to apply under various paradigms.

The 39-page RFP (which can be viewed at http://www.ny.gov/futureofracing/index.htm) asks applicants to be very specific about their plans for the percentage of VLT revenues to be earmarked for purses and breeders awards, as well as how much would be spent on racing integrity issues, marketing, and capital improvements on the front sides and stable areas of the three racetracks.

The aforementioned Friends of New York Racing, which, under the guidance of former National Thoroughbred Racing Commissioner Tim Smith, issued its report and recommendations last December before being dissolved, deserves credit for some of the RFP language. Its report, which called for specific legislative changes in 2006, also outlined a series of questions for the RFP, and asked that some proposals or pledges made in the RFP process be guaranteed. Almost word for word, those recommendations appear in the RFP.

Without Friends of New York Racing (funded by The Jockey Club, Breeders' Cup, Keeneland, Churchill Downs, Woodbine, Scientific Games, Magna Entertainment, Oak Tree Racing Association, Youbet.com, and Capital & Technology Advisors) there would be no road map for legislators and no blueprint for the RFP.

Following the Ad Hoc Committee's recommendation, legislation will be necessary, though this process, like any involving racing in New York, is subject to the illogic of politics. Bennett Liebman, coordinator of the Government Law Center at the Albany Law School and a former member of the New York State Racing and Wagering Board, said New York's racing law "has become the functional equivalent of crabgrass. It is a weed that has grown unaided and unwanted that has completely enveloped New York racing."

Complicating matters is the fact Republican Gov. George Pataki will be vacating his office after a gubernatorial election in November in which Democratic Attorney General Eliot Spitzer will be heavily favored over Republican John Faso. The big question then would be whether or not Spitzer will undo the Ad Hoc Committee's work.