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Wednesday, September 26, 2012

Another Fine Idea

Spent the last couple of days trying to sort out the latest developments and reports regarding the future of NYRA so that I could organize my thoughts and write a coherent and well-thought out  post...

Well, actually, I've been out at rock shows the last two nights.  I'm tired and so I'm just gonna go with some random ranting and raving, if you don't mind; it'll be fun.  It all started on Monday when the Post's Frederic U. Dicker reported - and I think we can now say, inaccurately - that Governor Cuomo - "in a startling move....plans to seek public bids for a new operator to replace NYRA.....from for-profit companies with deep experience in the racing and/or entertainment industries."

This immediately sent NY racing politics wonks like myself scurrying to once again read the vague language in the Franchise Agreement that would allow the Racing and Wagering Board to revoke NYRA's franchise.   Until I quickly learned that that is not exactly what the governor intends to do.  Howard Glaser, Cuomo's director of state operations, acknowledged and explained:

“The legal franchise is with the New York Racing Association — that doesn’t change,” Glaser said. But, he added without elaboration, “that’s a different question than who the operator ultimately is.” [Saratogian
Glaser said the possibility of hiring out management services is one of several options under discussion as public control of NYRA nears. "That NYRA is not functioning to expectations, that is not controversial or debatable."[Albany Times Union]
Actually, that's a debate I'd be happy to have with Mr. Glaser, another know-nothing political suit espousing the party line that the state has seduced the press and, in turn, most of the public into believing.

It took the New York Times to ultimately put the pieces together for me.  Essentially and summing up, what the governor was really saying is that the new NYRA board will be charged, as per the legislation to take it over that he must sign by Oct 1, with the task of determining the best course for the NYRA tracks once the state cedes control in three years.  While he would be amenable to the idea of a private operator taking over, that would only occur if the new board basically votes itself out of existence.  According to the Times (in the section of the article that was not turned over to Joe Drape for his canned spiel about the Aqueduct breakdowns, thereby apparently qualifying it for inclusion in its Breakdowns - Death and Disarray series), the governor in fact was not necessarily pushing for the racetracks to be put in private hands.  And in what was by far the most accurate thing he's ever uttered about the industry, Cuomo said:
  “I’m not really a horse racing expert.....I don’t know this industry especially well. The point of the exercise of appointing the board is to do the study and the research to answer that question.”

So, that's a lot different from what Dicker initially reported.  If his authorized biography of the governor is as accurate as some of his reporting, it might end up being adapted for the screenplay of a new original series on SyFy.

Now, it has also been reported that potential new operators of the NYRA tracks could include companies such as The Stronach Group or Churchill Downs; in fact, I saw a couple of stories that reported that those companies had no comment when asked about their interest.  That made me laugh. I don't think I'm going out on too long of a limb when I say this: Neither Frank Stronach nor Churchill Downs will ever operate the NYRA tracks.  Unless Cuomo and the legislative leaders load the board with either raving lunatics, extended Stronach family members, or former contestants in the Frank's Energy Drink Model Contest, nobody in his right mind is going to conclude that "the best way to get value for the taxpayers" is to hand the tracks over to Frank Stronach.

The case against Churchill is a more subtle one, as I wouldn't put that company in the inept buffoon category.  Part of it relies on my own naive belief and faith that, in the end and when push comes to shove, good ol' common sense generally wins the day.  (As we can only hope continues in this case.) Considering that Andrew Cuomo threw such a hissy fit when NYRA had the unmitigated gall to contract out call center jobs to a Churchill Downs-owned hub in Oregon, do you really think that he would ultimately permit the entirety of New York racing operations to be sold to that company with its corporate headquarters in Kentucky?  Seriously?  What do you think that Churchill Downs Incorporated would say if Cuomo tried to tell them how and where to operate their business more efficiently?  One doesn't have to look very hard to see how this bottom-line oriented public company approaches their acquisitions - just look at the Brisnet website.  CDI bought that company in 2007 to acquire its lucrative ADW platform, and to use its data as a lure for bettors to add to its profits.  But the website itself, still a wealth of useful information - much of it free - has languished in technological obscurity here well into the digital age.  Not a single pixel of that site has been updated since then (and nor for that matter for as long as I can recall, going back literally to the last century). Its past performance product, at its core a perfectly acceptable alternative to the Form, hasn't progressed past the PDF stage!  I'd guess that the Belmont grandstand would meet a similar regimen of neglect.

Somebody has got to get the governor's ear on this stuff.  What exactly does Ben Liebman do anyway?  We lost his indispensable racing news link site on the Albany Law School site when he took a position as Cuomo's Deputy Secretary for Racing and Gaming, and we never hear from the guy. As I recall, Ben has mixed feelings towards NYRA.  But certainly he's one guy who could surely advise the governor, who seems to genuinely take great pride in the state's accomplishments and resources, that New York racing is a precious resource too, with a storied history and - still, despite his best efforts - looked up to as a leader (and revenue generator) by the rest of the horse racing nation.  I mean, this governor is just downright disrespectful - seriously, he wants to take charge of racing and he can't show up for the Travers or the Belmont?   The other day, he referred to the sport as "quote-unquote horse racing."  What the quote-unquote fuck does that even mean?   Someone has to be able to impress upon this man - isn't that what advisors are for when it comes to topics that the governor himself admits he lacks knowledge? - that, whatever his opinion of NYRA is, the idea of the New York tracks becoming just another item in Churchill Down's portfolio of racing and gambling properties - including Calder, where they resort to near-naked women on the video monitors to try and generate handle - would be an insult to his state and an affront to anyone - person or horse - who has ever stepped foot on a racetrack here.

Also keep in mind the possibility that Cuomo has - or so we're told by the press - presidential ambitions for 2016.  The end of the three years of state control will roll around just when the primary races are starting to heat up.  So the governor will have to be careful about anything that gives even the appearance of shipping jobs out of his state.  "Governor, you sold out the storied Saratoga racetrack to a company in Kentucky; what's to say you won't ship jobs overseas?" I can just picture candidate Andrew Weiner asking him at a debate.

Whatsmore, (and I think finally), the recently prevailing winds coming out of this administration have borne the stench of the reduction, if not elimination, of revenue from slots.  Glaser even mentioned "significant subsidies from the state" during his press appearance on Monday.  But there isn't a company in the world that is going to be interested in operating the tracks if - as we've heard suggested by other Cuomo tools in the administration - slots subsidies are cut or eliminated.   And that's not even considering the possible damaging effects of full-blown casino gaming.  So this new idea of privatization actually flies squarely counter to the party line that the Cuomo administration has been sounding up until now.

So, I guess I just could have said in place of all of that: I don't see this happening.  The NYRA Board will do their research and conclude that things are not nearly broke enough to fix.  And just as Governor Spitzer reluctantly accepted the New York Racing Association, so will Governor Cuomo.  And as much as he really cares about all of this, he'll get over it in a few hours.

And one more thing.

Dicker again refers to the "massive 'takeout scandal' that cost bettors nearly $8.5 million over a 15-month period ending late last year."  And yeah, I know I've gone off on this before.  But, to me, the biggest scandal about the takeout error, as I'll refer to it, is the way it's been grossly blown out of proportion as a means to get us to this uncertain point where we are now. 

For one thing, if you're going to slander someone by misrepresenting facts, you might as well do so accurately. According to the outgoing communications director Dan Silver - who has never told me anything inaccurate and surely has no reason to do so now - the correct figure is actually $7.3 million, with $1.1 million bet through NYRA.  Dan informs me that someone, at some point, double counted the $1.1 million, adding it back and rounding it up to $8.5 million, and it just stuck.   Nitpicking?  Maybe, but let's get the number right.  Of that $1.1 NYRA piece, $438,000 was returned via NYRA Rewards, and $157,000 million via tax forms.  So the "massive" scandal resulted in a gross gain to NYRA of $505,000, over 18 months; and that's before it paid all of the fees and taxes to the state.  That's right....while the payment to Vito Lopez's victims, approved by consistent NYRA-critic Tom DiNapoli, and kinda defended by the governor himself before he kinda undefended it, was taxpayer money, it seems to me that the taxpayers actually benefited from this one, with no material harm whatsoever done to any of the "victims," most of whom don't even know that they're missing a couple of bucks.  So, since I don't see where Shelly Silver has lost his job, maybe instead of getting fired, Charlie Hayward should have gotten that Deputy Secretary for Racing and Gaming gig.  Jeez, I am so sick of this crap.

26 Comments:

Anonymous said...

NYT's,PETA and the Cuomo gang,how much more love can NY racing take from Liberal progressives?

Anonymous said...

Excelsior Racing Associates is being touted as the successor...Wynn, Bailey, Bronson, Fields, and Bruno's vet who had to leave the State Racing & Wagering Board....Can't wait :(

Steve Zorn said...

Governor's Box at Belmont has great views of the race track; I know because I brought some friends to the track Saturday and we had that box all to ourselves. Pity Cuomo hasn't used it.

Is that Excelsior rumor at all serious? Apart from Gary Contessa and Jerry Bailey as front men, what did Excelsior have to offer?

Anonymous said...

A,

Would you be so forgiving if a bank overcharged people's checking accounts by $2 that they weren't supposed to, resulting in profits for the bank going up, and the CEO and CFO getting a fatter bonus?

PTP

Anonymous said...

alan... great summary of the mess we have in NY. Politics will calm down when they realize they have little to gain from all of this. Part of it is a smoke screen for the reason that they do not know why those horses died. History will record that $8.5 mil is really $.5 m. The Gov will move on to bigger issues....besides what does slot money have to do with horse recing? $90k for a maiden 2yo race...Really?

o_crunk said...

Aside from the fact that you still don't get it that the takeout snafu has nothing to do with a number but an attitude of not giving a shit about the customer. They all knew about the takeout and played political games at the customer's expense. Let's put away the whining and crying about that and what happened for a moment and let's think about what might happen.

I feel like I've seen this movie before. Put the franchise up for bid, don't get many takers when word gets out that any entity running the franchise will not get a share of slots revenue. Gee, where has that happened? Oh, it just happened at Monmouth Park.

So let's see what happened there. Christie basically gave the track away to the horsemen just to get it out of his hair. Yeah, the horsemen even managed to get some revs back out of the deal...that's how desperate Christie was just to get out from running the tracks. So essentially at the end of the day at Monmouth you've got the same people running the track as before now with much more reduced power over their situation. They're not getting the casino revs from AC and they're not getting much help from the state.

And now the horsemen have the joint to themselves. They built mini golf courses and they're going to build a casino despite not having a license to run one.

Basically anything that doesn't involve increasing the revs generated by what happens on the track. Build a hotel, a boardwalk...whatever. Meanwhile the product at Monmouth sucks, slipping into a third tier track.

I'd expect the same thing at NYRA. The horsemen will run it at the end of the day and then they'll slowly run into the ground.

Anonymous said...

Lots of folks have looked at horse racing in NY with plenty of interest. Granted, some for the casino rights, some for control of the simulcast signal, some for the real estate development, while others actually focused on what happens at the racetrack. I'm convinced somebody with actual knowledge of the game and its audience, along with passion for the horses and their owners and caretakers, will make a go of this thing.

Alan Mann said...

PTP - No. Of course not. But I hardly think that the idea of profit or a bonus were at play here. Having said that, it's true that I'd probably have a different attitude if a different kind of corporation was involved.

Chris - I think it's surely a fair point that they knew that the takeout could be lowered and chose not to due to political considerations. I don't know however that it was as much not giving a shit about the customer attitude than trying to navigate a hostile political environment in order to get things - such as teletheaters - that would ultimately benefit both NYRA and the customer. And I'm not trying to say it was a benevolent act. Just that I think it stemmed more from an understandable sense of paranoia than outright hostility to the horseplayer.

August Song said...

Selective perception, one has to love it, huh? Cuomo's cronies, who were involved in the Aqueduct Entertainment Group bid-rigging casino scam, cost the state and it's citizens millions of dollars. Some of those same Cuomo cronies are now directly implicated in the Vito Lopez sexual harassment payoff debacle. What did Cuomo do as the Attorney General to indict/impeach/prosecute/punish his cronies for their involvement in the AEG scam and protect the citizens? Absolutely nothing, except recommend David Paterson for appointment to the MTA board. What has Cuomo done or said about the Vito Lopez sexual harassment payoff done by some of his cronies? Absolutely nothing. Cuomo appears to be functioning in that grand tradition set forth in New York politics by the likes of Boss Tweed & Tammany Hall.

jk said...

The Gov's gambling strategy has run out of steam. The Big A convention center never made it off the ground. It appears finding a new "operator" for the NYRA "franchise" is a flop as well. He might have to wait for casino gambling to be legalized to make his next big move. Meanwhile budget gaps, pensions and salary increases await.

Anonymous said...

With no slot revenue,the State/Cuomo will have to lower the taxes that they take from NYRA in order to sell.

Sal Carcia said...

I never got over the Charles Hayward firing. To me, it was the point that the NY racing community needed to stand up for itself. Letting the Gov. backed by NYtimes label horseracing as being corrupt without any pushback from the racing community was a signal that Gov.could push horseracing around without any resistance. Where are all these racing groups and committees when you need them?

Sometimes I get over it and then the referenced NYTIMES article uses words like "dysfunctional" for the NYRA and "nation's premier racing circuit" for NY racing. These two things are impossible to occur at the same time. The NY racing community and any industry groups and fans have got to unite to get the State of NY to live up to the agreements and obligations it has made to NY racing.

Anonymous said...

$8.00 beers $6 hot dogs. High takeout. $90,000 maidens with over half the field as nags. $2 "premium" parking, $3 gate fee, $3.00 program before you even start spending your money. Half the machines at Belmont haven't worked in ages.
As someone said if a bank overcharges peoples accounts by $2 resulting in non deserved profits for the banks and the CEO-CFO's getting bigger bonuses, you'd all be up in arms!
It's about the regular fans being screwed once again by the track. They never care care about the fan. No one shows up at the track anymore. So a few days you get a few young kids in to drink and bet a few bucks. They don't come back. They show up like 5 days a year.
Plus anyone with a brain knows and hears about ALL these drugged up horses and all these "super trainers" winning with BS nags.
It screwed itself and the fans for years. Some computer off track whale money won't bring it back. Way too much better sports/game competition out there now with better odds and WAY BETTER customer service.

Anonymous said...

Well, if we are going to discuss the slander or probably more accurately the libel (since libel applies to the written word), the amount of the "error" is only the roughly $1.1 million wagered on track. The statute in question clearly states it applies to "On-track" wagers. Adding amounts not included or covered under the statute, is slander/libel.

Figless said...

How does someone who acknowledges he knows nothing about an industry take such knee jerk radical action against that industry? Is this the temperament you want in your commander in chief?

alan said...

>>The statute in question clearly states it applies to "On-track" wagers.

Is that right?

Anonymous said...

If Horseracing ever gets a Commissioner these are the first words that should be uttered from his/her mouth."I'm sorry"




NFL Commissioner Roger Goodell is apologizing to fans.

http://www.nypost.com/p/sports/more_sports/nfl_commissioner_apologizes_to_fans_Hr2plzAo6E6wZMTT8w3BSM

Dakin said...

the only way a for profit company would have interest in taking over operation of the 3 tracks is if they were bundled with all of the OTB's, including dormant NYC. state government nor a public benefit corporation should not be running a sports/gambling operation of any kind. the racing operation and product and OTB's should be aligned with one operator.

jk said...

Is it too late to delete Hayward and include Cuomo in the $250k mural NYRA commissioned from PEB for Belmont Park?

Anonymous said...

Why the fear mongering amongst the NY state and administration critics? This new dynamic for the future of the horse industry in NY could be very, very good for everyone. The old-new NYRA has been deemed unfit for service, so time to move on to greener pastures. It's not that big a deal, replacing corporate management, as it happens all the time. Nobody is trying to collapse and discard horse racing, just attempting to make it the best that it can be.

alan said...

>>Nobody is trying to collapse and discard horse racing, just attempting to make it the best that it can be.

I think we've gotten mixed signals about that, at best. You make a fair point, but the concern is what this corporate management would be replaced with.

Anonymous said...

When you say replaced with,you mean with or without slots right?


with slots anyone can do what their doing now.


Look at Parx with slots,no consideration for horseplayers and It continues to be a 2nd or 3rd rate track.

steve in nc said...

Alan, thank you for putting it all in perspective. This should be mandatory reading for anyone involved in the decision-making (oh, yeah, they'll have their intern read it).

It makes me think of applying the old Casey Stengel remark: Can't anyone here run this game?!

Wallyhorse said...

From my views on this at:

http://www.toosmarttofail.com/forums/showthread.php/29507

This is something if Cuomo fails to do it right could blow up in his face and could prove very costly to any chance he has to run for President in 2016. I'm sure national Democratic Party leaders are going to be watching and going over this with a fine tooth comb knowing if we have a repeat of 2000, something like this could be the deciding issue if it came down to Florida like it did 12 years ago because the Breeders there will remember something like this if they get messed with as a result. If the vote were exactly as it was in 2000, it is exactly the kind of otherwise minuscule-to-nonexistent issue that (should NEVER be a factor but then becomes one that) could derail the Democrats if Cuomo is the nominee and everything else broke exactly as it did in 2000, something the Democrats obviously will be watching carefully over the next four years regardless of who wins this November.

If as some expect Cuomo tries to keep the casino revenues, I would not be surprised if he is told by national Democratic Party leaders not to do that because it could have unintended consequences, specifically with Florida come 2016 if Cuomo did run for President and he did win the Democratic nomination because of the huge breeding interests there that send many horses that race in New York.

And if you think such an issue doesn't matter, just go back 12 years to 2000, when Bush won the White House and won Florida by 530 or so votes officially (and 1,500 or so after the votes were recounted for a public record later on). In that case, it was the case of Elian Gonzalez that pretty much decided the election because that single issue mattered to Cuban Americans in South Florida that caused just enough of them to vote for Bush that allowed Bush to win Florida. What Cuomo may want to do by grabbing the Casino revenues is exactly the kind of seemingly minuscule-to-nonexistent issue in the rest of the country is the kind of single issue that if it again came down to Florida like it did in 2000 and Florida was as close as it was then and the breeders in Florida were screwed because of Cuomo taking casino funds in New York that otherwise were earmarked for Horse Racing, the Breeders could turn around and vote just enough for Cuomo's opponent for that opponent to win and cost him and the Democrats the White House. That is why I see the national Democratic Party leaders stepping in and dictating how this is handled because of their thinking ahead to 2016 and what could happen.

On another front, not that it likely would happen, but with the Governor wanting to get NYRA off its back, wouldn't it be poetic justice if somehow, the Oak Tree Racing Association after being screwed in their home state by Frank Stronach taking over what had been their fall dates in 2011 (which is now Santa Anita's Autumn meeting) would wind up being the ones who took over the NYRA tracks and ran them full time? They have a proven track record with running Santa Anita's fall meet from 1969-2009 and the one Oak Tree season at Hollywood Park in 2010, and I suspect if they got the chance to take over, they would make the most of it knowing how screwed they were out west.

Anonymous said...

looks like you're going to need an update

http://www.nytimes.com/2012/09/28/sports/aqueduct-racing-officials-faulted-in-horse-deaths.html?_r=1&ref=sports

Anonymous said...

same anon as 2:03 here

and now we know the real reason for the the weird cancellation at belmont friday!