NYRA, MGM Finally Sign Contract

The New York Racing Association and MGM Mirage announced June 16 that they have formally entered into a deal in which the Las Vegas gambling company will develop and manage a new video lottery terminal casino at NYRA's Aqueduct racetrack.

The deal to have MGM oversee the racino, which will have 4,500 VLTs, was announced a couple years ago, but the actual contract had never been signed. MGM had been awaiting legislation, passed earlier this year in Albany, to ensure that it will remain the VLT manager -- and, therefore, get its investment paid back -- if NYRA loses its franchise to operate Aqueduct. NYRA's franchise for Aqueduct, Belmont, and Saratoga tracks expires at the end of 2007, and all sides expect NYRA to face an uphill battle to keep the tracks.

The deal was also cleared when New York's highest court recently ruled that the state's 2001 VLT law is constitutional.

"We are eager to resume work on this long-delayed project," Terry Lanni, chairman and chief executive officer of MGM said in a written statement.

The project will cost $170 million, up from the $140 million estimate when first announced. The facility is expected to open in mid-2006; NYRA officials recently said they hoped construction could start in July.