Edited press release
A revenue-sharing deal for video lottery terminals at Aqueduct would give horsemen 7.5% of gross gaming revenue for the first three years, and breeders 1.25% for the first five years, once the devices are operating.
The New York Racing Association, New York Thoroughbred Horsemen's Association, and New York Breeding and Development Fund announced Nov. 3 the deal had been finalized. The gaming machines could be online "late next year," according to a joint release.
Aqueduct would have 4,500 VLTs. MGM Mirage will manage the gaming operation for NYRA, which will borrow $170 million from the casino company to build the VLT facility.
The state projects Aqueduct will provide $400 million a year for education.
"I am incredibly excited for racing in the sate of New York," C. Steven Duncker, co-chairman of the NYRA board of trustees, said in the release. "This once again proves that NYRA is committed to presenting the best racing in the world. We congratulate the horsemen and breeders in reaching this agreement."
NYRA receive a fee for serving as a lottery agent. The proceeds will be used to pay MGM Mirage, repay debut, and cover operating expenses, according to the release.
The horsemen's share of gross revenue will increase to 7.75% in years four and five, and to 10% from year six on. Horsemen said they would allot $3.5 million a year for capital improvements in the stable area for as long as NYRA holds the franchise to operate Aqueduct, Belmont Park, and Saratoga.
The franchise expires at the end of 2007.
"I am thrilled that we have reached an agreement and the horsemen are completely satisfied with the terms," New York THA president Richard Bomze said. "This agreement clearly demonstrates NYRA's commitment to the New York racing industry. We look forward to working with NYRA and the VLTs coming to Aqueduct."
Breeders will get a bump in their gaming share to 1.5% from year six on.
"The revenue from VLT operations at Aqueduct is expected to generate in excess of $7 million for New York's breeding program, and, additionally, allow New York-breds to run at purse levels that will be second to none in the United States," said Martin Kinsella, executive director of the breeding and development fund. "I'm optimistic that NYRA can get the long-anticipated VLT operation up and running as soon as possible to the benefit of state education revenue as well as solidifying New York's status in the national breeding and racing industry."
VLTs are operating at only one Thoroughbred track in New York--Finger Lakes Gaming and Racetrack. Four harness tracks--Batavia Downs, Buffalo Raceway, Monticello Raceway, and Saratoga Gaming and Raceway--have VLTs.