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Friday, February 29, 2008

Bloomberg On OTB Offensive

- Senator Bruno was in the city on Thursday, and met with Mayor Bloomberg. The Daily Politics reports that NYC OTB was on the agenda; and that Bloomberg also brought up the subject at a bipartisan dinner at Gracie Mansion last night. The fate of the state's OTB's, not just NYC's, is of course the other shoe lead boot yet to drop from the franchise debate. You gotta wonder if it would even still be a matter of discussion if not for the Mayor's threat to shut NYC OTB down, so we probably can thank the non-presidential candidate for that. The larger issue of consolidating the OTB's is, as you may recall, supposed to be considered by some committee by next spring....but will that still occur in the increasingly likely event that Bruno is no longer the Majority Leader by that time?

June 15 is the stated deadline for shutting down the 73 parlors; but remember that the budget deadline is March 31; so if the state is going to give up revenue, chances are it may have to be settled by then. Already we're starting to read romanticized eulogies to the sleazy shops; and indeed, here's one parlor in Queens that has already shut its doors. As you probably know, the Mayor and NYC-OTB are seeking relief from the payments and fees to the industry and state that they claim are eating up the $125 million or so of net profit from the more than $1 billion in wagers it handles.

- NYRA chairman C. Steven Duncker is profiled in the Public Lives column in today's NY Times. He takes the opportunity to remind us that the franchise deal is not a......

Mr. Duncker estimates the worth of the property at $1.5 billion. “So you can’t call the $105 million a bailout. If you’re the state, it looks like a pretty good deal for you. Let’s just say that if I was at Goldman Sachs and made that trade, they wouldn’t like it. But the bottom line is, if N.Y.R.A. hadn’t cleaned up its act, none of this would ever have happened,” he says.
Duncker also decries the stalling by the Pataki Administration that helped kill the MGM racino; I don't recall reading anything regarding NYRA dropping its lawsuit on that matter as part of the agreement. Perhaps that's one of the issues that still needs to be worked out in order to finalize the deal. He also says, of OTB: “It’s a broken business model; even Jack Welch couldn’t run OTB in New York and make it turn a profit.”

I wasn't aware that Duncker was a part owner of Bates Motel, who won the Santa Anita Handicap in 1983. That was a 17 horse field, and this Saturday's renewal, with 14 entrants, will match the largest field since then if all go to the post. It's a wonderfully wackily wide open field, as evidenced by the fact that the morning line favorite, Awesome Gem, is listed at 4-1. I'd venture a guess that I watched Bates Motel win that race, perhaps on ABC? But on the NTRA website, regarding tomorrow's race, it reads simply - TV: [blank]. As in, none. Some will see it if HRTV is still in business. I betcha that the NHL Network would carry it if it was the NTRA Network instead. But the idea of an industry-run network, something all of the major team sports now have (and yes, hockey is a major team sport, in my house at least) is one we'll save for another time. The pp's for the Big Cap are here.

- Just wait one second proclaims a couple of editorials in Pennsylvania in response to some talk by state legislators at the Pennsylvania Gaming Congress about bringing table games to the state. Both pieces cite, for one thing, the indictment of Mt. Airy Lodge owner Louis DeNaples for allegedly lying to state gambling regulators about past ties to organized crime.

But at least one state Senator feels that Pennsylvania already has a form of table games.
Sen. Patrick Browne, R-Lehigh, quizzed gaming regulators about virtual blackjack games that are allowed in Pennsylvania casinos.

The Gaming Control Board last year legalized video blackjack, which simulates the real game by allowing multiple players to sit before an electronic image of a dealer. Traditional table games with a human dealer are prohibited in Pennsylvania.
[Browne] said it’s an “obvious stretch” to say lawmakers intended the virtual games in slots halls. []
But gaming commission chairperson Mary DiGiacomo Colins said “It’s basically a video game."
The gaming board has said virtual games can be legal if the odds are random and one player’s decisions do not affect another’s odds.


Anonymous said...

Nice spin by Duncker.

No matter how you look at it, the State has paid for the land twice. His statement makes sense only if you buy into the theory that NYRA was permitted to operate with a franchise for 50 plus years and got to keep the land, regardless what the statutes said. Too bad the politicians in the state are gutless. I would have preferred seeing this litigated over spending hundreds and hundreds of millions of dollars to bailout NYRA and then let them stay in power.

Duncker is a fraud. Good thing he's term-limited. I hope there's racing around by the time he's shown the door.

Anonymous said...

I wonder if the above poster ever met Steve Duncker. I have, and he is anything but a fraud, and he did a masterful job ensuring that New York racing - which remains the best in the country - didn't end up in the hands of some carpetbaggers (Empire), harness operators (Excelsior) or foreign bookmakers (Capital).

Yeah, those were some choices the politicians had. Gutless? Maybe in the case of not attacking the OTB morass. But in the case of renewing the franchise, how so? Please explain in detail what choices were there to be made.

Anonymous said...

NYRA was "permitted to operate", unbelievable how stupid some people are.

NYRA was conducting a legal business on land NYRA contributed to an public benefit entity, which was mandated by the state after they arbitrarilly discontinued racing in a political ploy to get a larger share of the vig.

The Franchise that they were "allowed" to operate generated billions in taxes to a corrupt Albany machine over the years until their business model was made impossible when their "benefactor" Albany created Off Track Wagering and the Lottery in order to get an even large share.

You can spin legal technicalities all you want, but the truth is Albany has no legal or moral right to the $1 Billion land package, to which they now will have full and clean title.

This has always been a disguised emminent domain land grab and everyone should be disgusted.

No other industry that employees this many people (probably the largest upstate provided of private jobs) would be treated this way, and everyone in racing should be embarrassed that they let it happen.

And please save the usual retort about NYRA "turning down" the OTB legislation. As proposed, it was an offer they could not accept, and no one at the time thought Albany would actually go into the bookmaking business themselves, which on the face appears unconstutional if you ponder it seriously.

Anonymous said...

I agree wholeheartedly with Anon 9:29 a.m. comments on what really happened with the NYRA franchise and the whole renewal process. I think most truly informed folks with no axe to grind can agree that the limitations of the state imposed business model are what led to NYRA's demise, beginning with the failure to correct the OTB relationship 30+ years ago and further complicated when markets shifted over the past ten or so years, i.e., the beginning of the VLT era, not because of NYRA corruption or failure in presenting world class racing. No industry that produced so much tax revenue and economic multipliers over so many years was ever saddled with the kind of baggage that anachronistic NY racing law and regulatory structure piled on NY racing, or am I wrong?
/S/Green Mtn Punter

Anonymous said...

Green Mountain -

Okay, the system is broken. After this legislation, it remains broken.

I distinctly recollect Charlie Hayward saying NYRA wouldn't take the new franchise unless the system was fixed. Guess he lied.

How long before we're back to problems?