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Tuesday, June 29, 2010

One Down.....

Bids for the Big A racino are due today, but don't expect a blanket photo finish.

Based on interviews with representatives, several cannot commit to the formal bid because of fiduciary duties – they can’t guarantee they would get a $300 million down payment back even while they’re on the hook of paying NYRA’s debt to the state at $2 million monthly. [Capitol Confidential]
Delaware North has already confirmed that they are out, and they may not be the last to do so. I was told by someone who was working with the company that it "wasn't even a close call." In a statement, company President William Bissett explains:
The Lottery’s RFP requires that the prospective developer pay a minimum upfront licensing fee of $300 million while assuming a number of very substantial business risks. These risks include the unknown amount of time that will be taken by New York State to complete its SEQR review process and to obtain all other required approvals so that construction of the gaming facility can begin, the uncertainty surrounding the State’s ability to fund the $250 million Capital Construction Grant that is intended to finance construction of the new gaming facility, the indefinite amount of financial support that the developer will be required to provide to the New York Racing Association, and the uncertainty surrounding the future expansion of competitive gaming operations at Belmont Park or other locations.


Anonymous said...

No way I would give Albany 300M without those guarantees in place, including protection against expansion of gambling during the term of the agreement.

I suppose there will be no other option but to sell the Big A to the Port Authority, which I have alleged all along to be the true political goal.

Sell the Big A for, oh lets see, 300M sounds like a good number, then approve gambling for Belmont and start the shakedown all over again.

Anonymous said...

Getting involved in the bidding process carries such high risk, it's incredible that any firm would bid on this project.

Would any of us in our right minds put down $300 million as an application fee with the chance that we'll NEVER see it again? Or if we may shoulder millions of dollars in debts that NYRA is still struggling to pay?

I agree with the earlier post that New York State is really looking to sell Aqueduct's land for a large chunk of money. The Shinecock Indian tribe is moving into position for a casino on Long Island. It would be much easier for the State to dump their casino project into a tribe's hands. I predict that a deal will be worked out - the Shinecocks will be allowed to stage gaming at Belmont in exchange for paying considerable taxes on their receipts. New York State, in the end, gets its money without having to administrate it.

Steve Wynn is somewhere else during all of this. Smart man. He's my hero.

Anonymous said...

If the Shinnecocks end up moving in for the kill, the NY Post should have a headline "I've got your Shinnecock right here." That'd be good. While I'll miss the Big A, I'll have fond memories of that time I hit big on Monarch's Maze in the Red Smith. After that it was all downhill, but I'll always have that glorious afternoon. -jp

Figless said...

Belmont is outside the 75 mile Federal limit for the Tribe, I think.

Anonymous said...

You're correct, Belmont is outside of the tribal lines, but it's possible for an agreement to be reached between New York State and the tribe to extend their lines to where Belmont is...for a small fee.

Steve Zorn said...

In the event, there were three bids -- Penn National, SL Green/Hardrock, and my favorite, Genting from Malaysia. I've been to the Genting casino in their home country, and they know how to do it right. No chance at all, I suppose, that they'll get a shot in NY.

Clairvest, which had been part of the ill-fated AEG bid last time around, had registered as a potential separate bidder, but ended up joining forces with the SL Green/Hardrock group.

Anonymous said...

Geez, if the intel is right and Genting really has $1.8 billion in cash in the till, I would think that that kind of dough really talks in NY these days, local roots or not. I mean NY, with it's reputation for urbane sophistication and worldliness, has to lose it's provincial outlook and join the global economy at some point, doesn't it?!

The locals just can't come up that kind of grease these days so my vote goes to Genting, but then again what do I know? What more opportune moment will arise for NY to get a financially capable VLT operator aboard? Besides, the Monticello connection should be good enough for local roots, shouldn't it?

What a bunch of yokels down in Albany, can't they see their ship has come in? I, like Steve Zorn, am amazed that Albany could pass up an opportunity like this to make wealthy new friends in Maylasia. Just think of the comped Singapore gambling junkets that could result? /S/greenmtnpunter

El Angelo said...

Gambling junkets hoofing it across the globe from Singapore to South Ozone Park was one of the funnier ideas I've heard today. Well done, GMP.