A State Comptroller report "determined that the franchise fees calculated by NYRA ....were understated by a combined total of at least $11.6 million and perhaps as much as $15.3 million."You may have read all the stories today with the screaming headlines about the latest revelation. Audit: NYRA shortchanged taxpayers, said the Daily News. The Albany Times-Union dusted off and trotted out Jeff Perlee to call NYRA "chronically dysfunctional" (which makes for an apt description of his own Empire Racing). The NY Post, in revealing the imminent release of the report the other day, labeled it a "bombshell."
However, like a lot of negative headlines we've read about NYRA over the last few years, it's not really news. In fact, the italicized excerpt at the top of this post is from a report released in 2002 by then Comptroller Alan Hevesi, and the shortfalls noted were from 2000 and 2001. NYRA and the state have long disagreed on how the franchise fees are to be calculated, so the fact that the state has additional claims since Hevesi's report is hardly a surprise.
There was apparently a meeting amongst the staffs of Spitzer, Bruno, and Silver on Thursday night to attempt to resolve the franchise. But talk about lack of transparency:
...spokespersons for the governor and Rep. Sheldon Silver, the speaker of the Assembly, would neither confirm nor deny that the meeting took place. [DRF]Meanwhile, the upstate Ithaca Journal reports that NYRA is not the only issue of importance to the state's racetracks. Still pending is a bill, passed earlier this year by the Senate, that would increase racetracks' share of VLT revenue. Once again, Jeff Gural is threatening to close his Tioga Downs and Vernon Downs harness tracks should the bill not be approved by the Assembly and signed into law. He claims the tracks are losing $1 million a month. “The economics just don't work."
With VLT revenues at the state's racinos disappointing almost across the board, the tracks that host them are suffering.
The owners of Monticello Raceway in the Catskills, meanwhile, are contemplating layoffs and going to a seasonal schedule.The average in other states is said to be around $250. The Assembly's racing committee chairman Gary Pretlow is said in the article to favor the new formula; earlier this year, he had expressed skepticism.
Even Yonkers Raceway, the state's largest video-lottery-terminal parlor, has failed to meet expectations, despite its proximity to New York City, analysts said.
“In some areas, especially Yonkers, the win per-day per-machine is much lower than anyone could have anticipated,” said Bennett Liebman, head of the Racing and Wagering Law Program at Albany Law School. “It's just a major disappointment.”
Since April, the revenue per machine per day in New York has averaged $168 a day, according to the state Lottery. Saratoga has averaged $234 a day per machine since April, while Finger Lakes, the state's only privately owned thoroughbred track, is at $224; Yonkers is at $209. Trailing the pack is Monticello at $121.
Track officials said it is difficult to compete with other states such as Pennsylvania, which let tracks keep a larger percentage of revenue and thus can woo gamblers with more amenities and giveaways.