NYRA and Trump in VLT Deal? It's Possible

The New York Racing Association, with its video lottery terminal program running behind schedule, is turning to outside casino operators to run its proposed Aqueduct VLT facility, and among those under consideration is Atlantic City casino mogul Donald Trump.

NYRA chairman Barry Schwartz said he recently talked to Trump about running the track's VLT operation. "It's possible," Schwartz said of Trump's involvement. "At this point, everyone is possible."

Trump operates casinos in Atlantic City, N.J., and has been involved in the flap over proposed casino gambling in the Catskill Mountains area northwest of New York City.

Meanwhile, though Schwartz said there are no current discussions about adding Belmont Park to the list of tracks eligible to obtain VLTs in New York--"We've got our hands full with Aqueduct," he said--that could change in the future.

Once Aqueduct's VLT facility is up and running and bringing in the revenue he expects, "it will be a no-brainer to go with these at Belmont," Schwartz said.

Schwartz said NYRA officials, led by trustee Steve Duncker, have reached out to a number of top casino companies in the country to not only run but also to help finance Aqueduct's VLT facility. He said NYRA trustees realize the racing group does not have the expertise to operate a gambling hall with 2,500 VLT machines.

"I'd like our all our people to be focused on racing," Schwartz said.

In an interview, Schwartz also said it has become clear that NYRA will not be able to get the facility open by next April. That is a key date because state law provides that if NYRA has the machines running by then, its franchise to run Aqueduct, Belmont Park, and Saratoga will automatically be extended until 2012.

But the NYRA chairman said the delays are not of NYRA's making. In fact, bids for the VLTs are only now just being opened at the state Lottery Division, which is overseeing the VLT program.

Schwartz, as well as sources in Albany, said it is likely that NYRA's allies in the legislature will merely extend the franchise extension law to allow for more time to get the VLT program in operation.

At issue with NYRA and the state's other racetracks is whether or not they can break even with the amount of revenues state law says they will get from the VLTs. Schwartz said NYRA will lose money if it has to settle for the 12.5% revenue share the tracks can keep.

The tracks have been negotiating with the Lottery to have it pick up other costs, such as marketing and providing security staff to patrol the VLT facilities. But, Schwartz said, the agency is concerned about picking up any more costs of the program, in part because there is a lawsuit pending that challenges any revenues being earmarked for racetracks.

For now, there are no decisions on the funding matters, and Schwartz said he believes the whole issue will have to wait until after this November's gubernatorial elections. "As soon as the election is over, I plan on going to Albany to talk about getting a better break in percentages," he said.

There is no timetable for when NYRA may begin operating VLTs. Schwartz said an architectural firm has come up with preliminary designs for the VLT center at Aqueduct, but that those plans are likely to be changed by whichever casino company is chosen to run the facility.

Outside companies, he said, are actively pushing to become NYRA's partner in the VLT facility. "There are 13 million people to tap (as potential customers), there's a subway stop right outside our main gate, and that doesn't exist at any casino in America. So the drop should be extraordinarily high," he said.