Head of New York Investment Fund Steps Downs

The longtime head of a quasi-state agency charged with financing improvements at New York's top Thoroughbred racetracks has resigned under a cloud, government officials said Oct. 9.

James de Pasquale, executive director of the New York State Thoroughbred Capital Investment Fund, has stepped down and is under investigation by the Pataki administration inspector general's office. Details about the probe were unavailable, but sources said a variety of records, including those pertaining to travel reimbursement, are being examined.

For years, the CIF has been doing battle with the New York Racing Association, and NYRA officials have privately blamed the CIF for a number of damaging press leaks that have come out in the past six months involving NYRA and its finances.

De Pasquale has been the executive director of the CIF since the early 1980s, and has counted former U.S. Sen. Alfonse D'Amato among his allies. The CIF chairman, William Levin, who has also been close with D'Amato over the years, did not return repeated calls for comment throughout the day Oct. 9.

"There has been a resignation," said Joseph Conway, a spokesman for Gov. George Pataki. "Because of our concerns, we have asked the inspector general to review the matter and conduct an investigation."

He declined to detail those concerns.

De Pasquale could not be reached for comment. Sources said he was transferred out of the CIF's Manhattan offices more than a week ago, and had been working out of the CIF's office at Belmont Park.

It is unclear how much De Pasquale made in his post. A 2001 state comptroller's document put his salary then at $128,000.

The CIF is owed millions of dollars by NYRA, which must pay a portion of its proceeds to the entity that was created by state law to serve as the official bank and overseer of capital improvements at NYRA's Aqueduct, Belmont, and Saratoga racetracks. Over the years, though, NYRA has done numerous end-runs around the CIF and created a sharp rift between the two entities.

Seven years ago, the CIF charged that capital improvements undertaken by NYRA without its approval were done using highly irregular procedures. The allegations led to widespread criticism of NYRA's bidding procedures and capital projects by state officials.

In more recent months, CIF officials were quietly working with members of the Pataki administration to devise a plan to take over NYRA's operations in case NYRA or its top officials were indicted. The CIF, by law, would be charged with running NYRA if the association lost its racing license.

A federal prosecutor in Brooklyn still hasn't decided whether to indict NYRA as part of an ongoing probe into a host of financial and management irregularities at NYRA, as well as illegal acts by NYRA employees.

More recently, Levin said he was filing a complaint with the state comptroller, Alan Hevesi, over NYRA's claims that the CIF had deferred loan repayments by NYRA, a claim Levin said is false.