As they say, the cover up is often worse than the crime, and man, is it ever in this case for NYRA. The 1% takeout snafu was made into a big deal by politicians and the press with the attention-getting "$8.6 million taken out of horseplayers' pockets," but truth was it consisted of dribs and drabs that most horseplayers - including this one - didn't notice and haven't to this day.
But now, the Racing and Wagering Board (which surely has its own incentive to pin the blame on somebody else) has determined that NYRA knew far more than it was letting on. And once you get to the cover-up part, the question is always "What did he know, and when did he know it." In the case of NYRA President Charles Hayward, it's apparently spelled out in black and white. He knew everything. And he had for quite awhile. If you haven't seen the email exchange between Hayward and Steven Crist:
“Later on August 1, 2011 Hayward responded to Crist: “This gentlemen [who contacted Crist to alert him to the takeout error] is correct. Off the record, we have been working on this for some time. We originally had thought that we would announce this for Saratoga but political forces intervened. Since we are showing substantial losses in 2010 and 2011 and we have been smacked around by Cuomo (and he could check the SRWB from approving), we decided to wait. Also, the regional OTBs who collectively lost money in 2010 will scream like stuck pigs and that would provoke Skelos who is very tight with the guys who run Nassau OTB to introduce anti-NYRA legislation for the benefit of the OTBs. Finally, we are quietly working on a plan to open 10 or so restaurant/bars in the city and we did not want the politicos to block this effort. We have some internal debates on how much to lower each pool and how we would present this to our simo customers, the consumers and the politicos. I would appreciate it if you could keep these details confidential. I would also welcome a further discussion on this topic with you before the meet is over.At the time, last December, when the error was revealed to those of us other than the sharp guy whose query to Crist precipitated all of this, NYRA explained that the sunset of the temporary takeout increase "was unintentionally overlooked due to the complexity of the takeout provisions in the Racing Law." But that was...simply not the case. [Going to stop using "allegedly" or "apparently" as long as nobody disputes the existence or accuracy of the reported emails, which....apparently....is not going to happen.]
“On August 1, 2011 Crist emailed Hayward: “Will keep it confidential and would love to discuss possible reduction schemes with you off the record whenever the time is right.” [Capitol Confidential]
Look, as I've written before, I think Charlie Hayward is a great guy who genuinely loves the game. He brilliantly maneuvered NYRA through the franchise process when everybody, including this occasional blogger, counted them out...and continued to successfully guide the association through subsequent financial and political pitfalls to get to this point where the slots money is finally flowing. Whatsmore, given the constant criticism and scrutiny from Albany, I can't even really blame him for retreating into the kind of bunker mentality that led to the tactics and thinking described in his correspondence to Crist. But no doubt this is the end of the road. The unpaid administrative leave that he and Sr. VP Patrick Kehoe have been placed on by the NYRA Board of Directors is merely the first step out the door. No way in the world that he survives this. NYRA's very existence is in peril at this point, as Franchise Oversight Board chairman Robert Megna has made quite clear.
"This is not an isolated instance." Megna continued: "A failure to meet this most fundamental obligation puts into doubt the continued efficacy of the state's franchise agreement with NYRA."So you can be sure that the NYRA Board will soon distance itself from those responsible as quickly as possible.
As for Steve Crist, the consequences are less dire, though surely embarrassing. He explained to the Daily News that he didn't quite grasp the fact that NYRA was overcharging contrary to the law. Whether or not you buy that, the fact is that he was surely put in a tough position here by a former colleague. Off the record is off the record; so whatever Crist did or did not understand, I don't know what else he could have done. Unfortunately, his credibility on matters pertaining to New York racing, which he has reported on so expertly and admirably for so long, is unquestionably compromised at this point.
- Little surprise to wake up yesterday, the Monday kicking off Derby week, to find yet another damaging front page article in the NY Times on equine breakdowns courtesy of Joe Drape. Big Purses, Sore Horses, and Death. Maybe they need a new headline writer there at the Times....that's the kind of thing I might resort to for a blog post when I just can't think of anything more clever or succinct. However, I have nothing else to criticize; it's a pretty solid piece; quite disturbing as you might imagine. Drape however...apparently...had nothing better to do late last night than to parse through Twitter posts from earlier in the day, take one completely out of time context and reply sarcastically in an...apparent... attempt to make the poster look stupid. And that's pretty pathetic.
- Thanks to all who have written to see if I'm still alive.