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Wednesday, August 26, 2009

No Lobbyist, No Problem (?)

As a reader pointed out, Jim Odato wrote on the Capitol Confidential blog of a fundraiser for Governor Paterson scheduled for Friday which will be hosted by the Albany lobbying/law firm of Featherstonhaugh, Wiley and Clyne.

Featherstonhaugh is an owner of Saratoga Racing and Gaming, the nearby harness track and video slots house once managed by Delaware North. He is a minor partner in Aqueduct Gaming LLC, which is a Delaware North-led partnership bidding for the rights to open a large video lottery terminal center at Aqueduct Race Track in Queens.

Paterson is expected to make a decision on the winning bidder among six competiting groups by the end of the Saratoga thoroughbred meet on Labor Day.
Of course, most of you know that last bit about Paterson's upcoming selection, but I left it in for effect. I guess it says something that the post drew little response; we just expect this kind of stuff in Albany I guess. But while this guy might just be a minor player, a fundraiser like this has gotta feel like a golden lifeline for this beleaguered governor right about now.

I feel bad for Paterson, and I was embarrassed for him after reading of his ill-advised remarks on race over the weekend. Now, he's trying to backtrack on the comments (after previously largely standing behind them) after being rebuked by, amongst others, a black former NYC mayor and a black current US president...and that's embarrassing too. I think he's a decent guy who was thrust into an impossible situation, but he's surely not helping himself now.

Maybe though he's just resigned to his fate; I've started to read reports that he's confided to friends that he won't run for re-election. He certainly sounded like someone who doesn't think very highly of his own political future.

Odato also reported that Penn National has hired a lobbyist; this after it increased its upfront offer by 5000%, from a token $5 million to a very serious $250 million.
The move leaves only the Don Peebles/MGM team not following the Albany model of using a lobbying firm in the procurement competition. Peebles is making use of his Peebles Corp. PR department however. He says he probably couldn’t find a lobbyist that isn’t already hired if he wanted one.

“I don’t see a need for a lobbyist,” he said. “This is a deal based on merit and overall community benefit.” [Capitol Confidential]
That's gotta be one of the funniest quotes I've read in almost five years of writing this thing. I think we can safely count this guy out.


Anonymous said...

Lobbyist James Featherstonhaugh has been around gaming determinations in NY since the 2001law was passed. His firm represented Caesars in the lobbying case against them when his firm made questionable arrangements for Speaker Sheldon Silver to meet out in Vegas with Caesar's in house counsel Kim Sinatra, now with Steve Wynn's company. One can almost connect the dots amongst these folks if approached with an open mind. Its no wonder Governor David Paterson is now on the Featherstonhaugh list.

Another issue that needs more discussion is the DNorth/Harrahs "cross marketing" arrangements via the Player's tracking system. This type of shared information system is strictly prohibited under the existing MOU rules. In fact, no company that has a gaming establishment elsewhere is permitted to advertise within NYC limits. Maybe the MOU rules don't apply to Delaware North Companies or perhaps they didn't even read the document?

The Wynn European gaming palace with man-made lake just seems overdone and out of place. By the way, what's the deal with Wynn having purchased his Macau gaming license from Stanley Ho, the reputed friend of Chinese criminals who's daughter Pansy is in hot water with MGM? I have read before where Wynn said that Pansy Ho and her brother Laurence who has a Hard rock Cafe in his Macau casino, would cause no regulatory problems for their partners on account of Stanley Ho's associations. Is this still Steve Wynn's position that the Ho's are safe, or would he now speak out against them? I wonder if he would even answer that question?

Meanwhile, the horsemen and breeders wait and the racetracks continue to deteriorate. This is not the way this deal was meant to go down, if indeed it was ever supposed to happen.

Alan Mann said...

>>This type of shared information system is strictly prohibited under the existing MOU rules. In fact, no company that has a gaming establishment elsewhere is permitted to advertise within NYC limits.

I do recall this clause from the MOU. But when I went back to the link to re-read it, I found that the document has been pulled from the governor's website.

Why do you think that is?

Steve Zorn said...

Just to make life more complicated, Featherstonhaugh's firm also represents the NY Thoroughbred Horsemen's Ass'n, which, of course,has a major interest in getting slots in place as soon as possible. You can't hire any of these guys without walking into a morass of conflicts.

Anonymous said...

Alan says "What do you think that is?" NY State at its finest! Slippery deals made in dark, dank basement rooms in Albany.

Anonymous said...

Always nice to see Steve Zorn on the blog!

I have taken a close look at the Wynn plans for Aqueduct. It certainly appears, and comments from his people have suggested, that what he proposes is an entirely new building which is why it will take 2 - 3 years to complete. Logically, this means that the current structure must be demolished. What happens to live racing at Aqueduct in the interim? How about morning training hours when the bulldozers and cranes are knocking the building down?

New York Lottery Commission favorite Steve Wynn's plan, is the perfect cover for the NYRA to ask the state to give it NYCOTB because it will be broke if it has to wait three years for its operating subsidy from the slots gaming. Just on eliminating broadcast duplication, consolidating parimutual systems, betting acounts, etc., the NYRA can make NYCOTB cash flow positive, while at the same time, saving its annual racing subsidy payment that it currently receives from NYCOTB which I believe is in excess of $90 million.

So who loses? While waiting it out for Wynn to complete the Queens Palace, the horsemen do as purses will get no boost, the breeders as the breeding fund will go without, and the capital improvement allocation to improve living conditions and the frontside "ambiance" at each of the NYRA tracks. Beyond Zorn, why aren't all the NY horsemen and breeders weighing in on what was meant to be their salvation?

Who has neautralized the horse voice in New York? Gordon Medinica and Bill Murray from the Lottery Commission could care less about NY horse racing and breeding. Just look up Medenica's coments from earlier this year, so maybe these guys are in fact trying to outweigh Paterson, Silver and Smith?

So much to think about.

Anonymous said...

Don Peebles also believes in Santa Claus, the Easter Bunny, BO's health insurance scheme is revenue neutral and that Teddie Kennedy was the greatest Senator of our generation.

Anonymous said...


You have followed this Aqueduct deal from the get go. there is a big push, and I concur with the other blogger here, to make Steve Wynn the man.

personally, i ssay send him back to vegas or to China! he doesn't know a mane from a tail, and the Lottery guys don't give a hoot about that! we can only hope Paterson senses what he can not see.

Anonymous said...

Wynn's lack of horsemanship is not at all relevant, whichever entity is annointed will have zero to do with horse racing. The only thing that should matter is who is most qualified to make the place a success.

Wynn is obviously the most qualified to build a gaming facility, but I do not trust him one iota.

IF he is placed first by the judges, the agreement must be ironclad with strict timetables attached to significant penalties (not incentives as govt is prone to issue) since he is essentially creating competition for his current AC empire, which is by far more important to him.

Every day this project is delayed is good for his empire in AC and Albany needs to remember that.

But then again, all crooks in Albany truly care about is the up front payment and the legal bribes in their "re-election" coffers.

To change subjects, I thought Alan's suspicion that Patterson may walk away is very astute. He has 5 Million in his re-election fund that I believe he gets to keep? if he retires from public service.

This is found money, why would he risk it on a long shot campaign?

jk said...

Foxwoods Casino Owner Mashantucket Tribe Seeks Debt Restructure

By Beth Jinks and Jonathan Keehner

Aug. 26 (Bloomberg) -- Mashantucket Western Pequot Tribal Nation, owner of the Foxwoods Resort Casino, is seeking to restructure at least $1.45 billion in debt as the recession and competition cut into winnings.

Anonymous said...

Can't see Wynn, or any of the other nationally recognized branded casino companies strictly complying with section 3.4 Non-Compete Covenant in the MOU.

"Vendor shall not utilize the VLT Facility in any way to attract patrons to other gaming facilities, whether through transportation arrangements, discount programs, or other services or attractions. Without limiting the generality of the foregoing, Vendor shall enter into a comprehensive confidentiality agreeement with State which prohibits use of the VLT facility gaming customer database for any purpose other than the advertisement, marketing and promotion of VLT gaming at Aqueduct, in order to prevent the diversion of VLT Facility patrons to other gaming venues. Furthermore, Vendor and its member companies and affiliates shall not advertise, market or promote competitive gaming in the New York City metropolitan area."

Can the Lottery Commission, David Paterson, Sheldon Silver and Malcolm Smith actually belive that the national and international casino gaming companies in this contest will not abuse this condition and steal the best Aqueduct customers for their high margin locations outside of New York state? My guess is any NYCity high rollers that come to Aqueduct will be shuttled across the street to JFK where planes will be waiting to take them on a free ride to wherever the casino company wants them to be!