Regulators Deny License to Vernon Downs

Racetracks seeking their 2003 operating licenses in New York did not fare well in their first try before the state Racing and Wagering Board.

While most of the track issues are expected to be resolved, Vernon Downs, the troubled Standardbred facility near Syracuse, faces an uncertain future after regulators gave an outright denial to its 2003 license. The board's move, after months if not years of conciliatory efforts by the state to keep the track open, means racing as well as simulcasting at the track will be barred after December 31.

At the annual license review meeting by the board December 23, regulators tabled a slew of track license applications. In fact only three Standardbred tracks in Western New York -- Yonkers Raceway, Buffalo Raceway and Batavia Downs -- saw their license requests granted.

The New York Racing Association had its application put off until a later date because Belmont racetrack has yet to obtain a required fire inspection, and Finger Lakes Racetrack didn't get its 2003 license approved because it has yet to obtain a contract with its horsemen's group. A new track seeking approval this year, Tioga Downs, located west of Binghamton, saw its 2003 license also deferred until a number of financial and regulatory issues are addressed.

Michael Hoblock, the board's chairman, said he envisions no lasting problems for the New York tracks; he expects any of the outstanding problems to be resolved soon. Despite the deferrals, he said there have been "drastic improvements" in the way in which tracks treat the annual license application process.

The notable exception was Vernon Downs. Regulators say the track continues to bleed money. Its debt level is soaring, it owes $820,000 in property taxes to the local county, and it is expecting its largest-ever annual loss -- $3.1 million -- this year. Officials accused the tracks management of misleading and delaying regulators in their attempt to get financial information about operations at the facility.

The board has already been sued by the track in its attempt to get an individual tied to the track's owners to become licensed by the state. State officials said the facilityâ's security is lacking, fire inspection problems have not been addressed and a deal is absent with its horsemenâ's group. Officials at the board's December 23 meeting also said there is evidence of unusually large levels of bet cancellations that affected odds of races, that a rebate-like program for some bettors was implemented against state rules and that the track's marketing director may be involved in horse training.

"I don't know what it is about Vernon Downs," Hoblock said.

Racing board member Cheryl Buley said the problems uncovered at Vernon Downs "are not in the best interest of racing."

Pending legal challenges, it is unclear when Vernon Downs will run racing again. However, most believe the track will not be shuttered over the long term since it is one of the facilities eligible to offer video lottery terminal betting.

"It's time," Hoblock said before voting to deny the track's 2003 license.