RSS Feed for this Blog

Monday, December 17, 2007

Extension Offered, Considered

- With virtually no possibility of the NY legislature convening before the end of the year, the state's Oversight Board, as reported by Tom Precious on Bloodhorse.com this morning, has approved letting [NYRA] continue running racing on a temporary basis until officials can agree on a new franchise-holder. But the extension is subject to acceptance by NYRA, which, shortly afterwards, released a statement which reads:

NYRA remains confident that an agreed memorandum of understanding and legislation will be achieved. NYRA will continue to work cooperatively toward that end.

NYRA’s attorneys are reviewing the resolution adopted today by the Non-Profit Racing Oversight Board to determine an appropriate course of action.
Those attorneys are presumably determining whether acceptance of the extension would in any way jeopardize its land claim. Charles Hayward had also told Precious the other day:
“We’d have to be convinced that we’re on our way to somewhere....Because, say we do 90 days from now, if there’s no more progress then on March 15 we’d be doing what we’re doing today. And it would be more detrimental for racing to stop then, right before the Wood Memorial, than it would on January 1." [Bloodhorse]
The extension offer includes no end date, merely that it will end upon the selection by Gov. Eliot Spitzer and the legislature of a new franchise operator. If NYRA doesn't agree, then the Oversight Board has the authority to enter into a contract with another operator; that according to the board's chairwoman Carole Stone. NYRA would, I'm sure, be back before the bankruptcy court before such an announcement had even dropped to the floor from Ms. Stone's mouth to protest anyone other than itself being on what it views as its property.

Another looming 12/31 deadline is the expiration on that date of TVG's exclusive broadcasting and account wagering deal with NYRA. However, in an email response, Mr. Hayward informed me that "on the account wagering side NYRA will no longer be exclusive with TVG and therefore the signal will be made available to all domestic account wagering platforms assuming that we can conclude a proper economic agreement with each of them." That would continue the recent trend towards the end of ADW exclusivity that started with the experimental open platform in California, and sounds similar to TVG's recent deal with the NJ Sports and Exposition Authority. The question of TVG's exclusivity with respect to the broadcast rights are still the subject of negotiations, which NYRA hopes to conclude before the end of the year.

8 Comments:

Anonymous said...

Joe Bruno must have got inside Charlie's head there Alan, 'cause I didn't see anything about not doing a deal with Tracknet Media.

Full Disclosure said...

Nice of Carol Stone to approve NYRA continueing to run racing after December 31, 2007, but since the legislation creating NYRA sunsets on December 31, 2007 exactly what entity exists to conduct the racing. Is this the apparition of NYRA or Ghostriders in the Sky?

Ah but what need is there to adhere to the law, this is New York, where horse can now merge with three card monte.

As I understand it if the Leg fails to act then on January 1, 2008 (when everything really will change) NYRA only exists for purposes of having the Bankruptcy Court distribute its assets to its creditors.

Anonymous said...

It would need to be structured as a formal legal extension of the Franchise of undetermined length, cancellable at any time.

Without that language,hHow can Ms. Stone approve a non-existant entity to run racing?

The way I understand things the only way NYRA continues to exist is IF it has the Franchise.

IF there is no Franchise, there is no NYRA.

I am sure NYRA will not go forward without that type of language in the agreement, or it would risk exposing the land.

jk said...

Albany punted. NYRA is right, better to shut down now vs. April. Hayward will have to play his hand and force the idiots in Albany to do someting.

Anonymous said...

Full Disclosure -

The Oversight Board is simply seeking to use NYRA as an operator of the racetracks - for the Oversight Board - in the nature of a management contractor. Under the terms of the statute, the Oversight Board has the authority to conduct racing at Aqueduct, Belmont and Saratoga when NYRA's franchise has ended and no new entity has been enfranchised.

The Oversight Board goes away by statute when the new franchise is awarded.

Stone didn't approve NYRA, she was given the power to contract with NYRA, if they choose to play ball. If they don't, she has the authority to look elsewhere.

Glimmerglass said...

So if at 1/1/08 NYRA doesn't have a deal in hand and the State wants to negotiate with another party the question becomes: where will that new party actually have racing?

It (nor NYS) sure as heck won't have any well defined right of possession to use the three tracks.

This will all then come to screeching halt when NYRA gets the courts to freeze any racing by a party other then NYRA on what has been claimed to be their land.

It is the same problem as before: if NYRA doesn't get to play it will take its ball and go home.

GE Capital was fully prepared to loan NYRA a huge amount of money in Chapter 11 [until the State coughed up the dough] using the track land as collateral. If their legal department didn't think strong merit was there for them to assert possession no way GE would've touched it. As we know NYRA as part of the renewal deal was going to drop its right of claim to the land. If NYRA was awarded just say a 5-year management of the tracks I would advise them to not give up that mega bargaining chip for that paltry duration.

The only winner: Maryland who will finally get some betting action that was flowing in NY with what could be a very long 'dark' period.

NYS isn't going to care that racing stops for a month or even two while this theoretically gets sorted out even though it should've been signed and sealed last year.

Btw - no one gets tickets for Spa until this gets sorted out. By now season holder orders would've been filled, now those folks wait.

Anonymous said...

Glimmerglass -

If there is no deal by December 31, 2007, its all cards on the table for each side. NYRA and the State head to bankruptcy court to settle the land issue. If NYRA wins, they are not likely to be afforded ‘state racing franchise’ status, meaning they would have to become an entity capable of turning a profit to stay in business. Considering they can’t turn a profit with special status, it would simply be a matter of time until they sell one of the two downstate racetracks.

If the State wins, goodbye NYRA.

NYRA doesn’t have a well-defined right of possession to the racetracks on January 1, 2008. That’s one of the reasons why racing is in this mess.


GE Capital had no risk. For the debtor-in-possession financing to be effective, the bankruptcy court would have to approve it and GE Capital would have received a priority interest. Enter land claim again. By the way, NYRA trustee Dennis Dammerman headed GE Capital, didn’t he?

Time to settle up. I’d like to see this resolved in court to end the issue once and for all.

Anonymous said...

Why wouldn't the State's land claim on January 1st be as valid as NYRA's, as the "reversionary interest" in the land that the NYRA has claimed belongs to NY State upon the expiration of the current NYRA franchise term?