NY News - Dec 23

- Recently, in speculating on ways for major league baseball to cast a blind eye to involvement by Yankees partner and Boss-to-be Steve Swindal in the eventual Aqueduct and Belmont racinos, I suggested that he could pledge to limit his involvement to the racing side of the venture. In response, I got a note from someone with connections to Empire claiming that NYS law does not allow the racing operation to be separate from the VLT's - that they are "by intent and design, interwoven." It was also suggested that Swindal, by virtue of his involvement with the Yanks' farm team in Staten Island, may already be in violation of MLB rules regarding ownership of minor league teams. Those regulations prohibit any involvement by officers or directors of such clubs in a "Legalized Gaming Enterprise" other than the breeding or ownership of racehorses.

Of course, there's always Swindal's wife, and Mr. Steinbrenner's daughter Jennifer; as well as the Boss' other daughter and sons, all of whom are involved with Excelsior. Blogger Verifiable checked back in with some more details of the gambling ambitions of Detroit Tigers' owner Mike Ilitch's wife Marian; given that, I still would imagine that Bud Selig will not cross the Boss on this.

Things have obviously changed in the last decade. In the course of doing some research, I came upon a 1995 NY Times article regarding the Steinbrenner family investing in the Red Mile harness track in Lexington, which states: Steinbrenner himself will not hold stock in the Red Mile because major league baseball rules prohibit franchise owners from having gambling investments. Swindal's involvement with the racing itself doesn't presently seem to be an issue at all.

- Empire CEO Jeff Perlee spoke to the Saratogian about the possibility of the company going public should they win the franchise. The article discusses the increased financing opportunities that come with publicly traded stock. Of course, it also can put a company in play, as we've seen recently with the humongous buyout of Harrah's by two private equity firms. As racing becomes more and more intertwined with and dependent on far more lucrative casino gambling, the possibility increases that it will eventually be swallowed up and spit out as more strictly bottom-line oriented investors become involved.

Excelsior principle Bill Mulrow is being mentioned as a possible successor to NY Comptroller Alan Hevesi, who has been forced to resign in disgrace. Hevesi, who once called NYRA the "poster child for mismanagement and corruption," thus avoided a possible jail sentence for using state employees to chauffer and tend to his wife. The NY tabloids seem to be taking particular delight in his fall.



Mulrow will obviously have to decide between one or the other; even in the wacky world of New York State, the comptroller cannot have an interest in an entity over which his office has traditionally exercised oversight; in fact, it would seem logical that his association with and lobbying for Excelsior thus far would already be sufficient to disqualify him from consideration. In any event, Mulrow, like Richard Fields, has close ties to Governor-to-be Spitzer. New York Magazine reports that: The Mulrow and Spitzer families are so close they vacationed together in Ireland last year.

As more entanglements between the two top bidders and state politicians emerge, Charlie Hayward must be smiling over at NYRA. Presently, no politician in his right mind would be seen on the same block as a NYRA executive. But who knows, by the middle of next year, an organization that was given a clean bill of ethical health by the federal government, with a proven track record of conducting the best racing in the country, and with no private planes with which to provide free rides to governors and senate majority leaders might not look so bad.