New York Officials Considering Overhaul of Racetrack Industry

New York Officials Considering Overhaul of Racetrack Industry
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New York officials are considering a major overhaul of the state’s Thoroughbred racetrack industry, with an eye to possibly shutting down Aqueduct racetrack, having a new operator run Belmont and giving the New York Racing Association rights to operate Saratoga.

The plan being examined by officials with Gov. Eliot Spitzer comes as the administration continues to review bids from four entities who want to control the franchise now held by NYRA to run the three tracks.

Two officials close to the matter, who spoke on condition of anonymity, said the Spitzer administration in the past week or so began eyeing a plan that would end the current bidding process for Aqueduct, Belmont and Saratoga. Unclear is whether the state, though, would necessarily re-start the entire bidding process for the new idea under consideration.

Driving part of the new route under consideration, officials say, was the recent withdrawal by MGM Mirage from a deal in which it was to develop a video lottery terminal casino at Aqueduct; MGM several years ago signed the casino agreement with NYRA. The withdrawal made officials examine whether it makes sense to continue operating the two downstate tracks run by NYRA.

Officials said the new idea under consideration involves three main components. First, the state would shut down and sell Aqueduct, which sits on 192 acres in Queens that could be ripe for a variety of real estate development plans. One source theorized that some of the sale of the assets could help to retire some of NYRA many financial obligations.

Second, the plan envisions winterizing Belmont, officials said, so racing could be offered at times during the year now handled by Aqueduct. Other features of a re-developed Belmont would include a casino and possibly other entertainment space.

Unclear is which, if any, of the entities now in the bidding process would take over Belmont – or even if any of them would be interested in just the one track. Besides NYRA, the bidders include Empire Racing Associates, Excelsior Racing Associates and Capital Play.

But officials said one idea under review involves selecting one of the entities now in the hunt for the franchise – though not NYRA – to take over the operations of Belmont.

The final component would keep NYRA and its leaders still on the scene in New York racing by having the group run Saratoga each summer. NYRA has held the franchise for the three tracks since 1955. Unclear is  whether the plan would resolve NYRA's land claims for the three tracks.

Officials said one idea under consideration would have NYRA enter into a partnership with another entity to operate Saratoga. Such a route might, officials say, allay concerns by some NYRA critics who say the racing group’s past legal and ongoing financial troubles should preclude it from continuing its presence in New York racing.

Such a sweeping change in the racing industry in New York would make it difficult to resolve the issue before lawmakers end their 2007 session at the end of June. If a deal is not struck by June 21, it would not be unusual for lawmakers to return later in the year to deal with such issues as the racing franchise.

If deals are not reached, officials in the administration and legislature have not ruled out simply extending NYRA’s franchise, which expires Dec. 31, for another year while the sides debate the structure of the franchise and the state’s Thoroughbred industry and its relationship to off-track betting corporations and other industry players.

 

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