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Racing Needs more protection than ever before from Casino operators

Editorial: NYRA, slots entwined ... by contract
Published: Saturday, August 31, 2013

The pressure is on the New York Racing Association to eliminate its reliance on revenue from the slot machines at Aqueduct Racetrack.

But that pressure is neither fair nor reasonable and runs counter to the 25-year agreement that NYRA and the state reached in 2008.

The contract in no way demands that racing stand on its own as a profitable venture. To the contrary, it spells out a dependence on revenue from slot machines at Aqueduct, with specific percentages going toward breeders, prize money and operations at the three thoroughbred tracks Saratoga Race Course and downstates Aqueduct and Belmont Park.

The contract also makes clear that while the reconstructed NYRA would operate the three tracks, all of the land, valued at about $1 billion, belongs to the state. As part of the agreement, NYRA gave up all claims to the property, averting what would have been years of court battles, to the detriment of racing and the local economy.

While it is true that NYRA lost $10.3 million through June, it did manage to pay $15 million in taxes, according to figures released the other day week. The next round of budget numbers will include Saratoga.

Most of the $10.3 million deficit for the first half of the year $8.6 million occurred in the first quarter, attributed by NYRA primarily to 10 fewer racing days, a schedule established so that horses could get more rest.

Without question, NYRA must find ways to attract fans and bring in more betting revenue without endangering horses, and NYRA must meet performance standards to retain its contract. But NYRAs new leadership should not back down on the organizations treatment of slots revenue as an integral part of its budget.

If a potential state constitutional amendment ultimately passes, allowing full-fledged casinos in New York and putting the Aqueduct slots in jeopardy, the new scenario might warrant a review of the contract terms to protect racing.

Things change, but the governor should not give New York the reputation of being a state that alters contracts on a whim.

Turning thoroughbred racing in New York into a profitable venture is a worthy goal. The long-term sustainability of racing should not depend on uncertain revenue streams.
But the present reliance on slots revenue should not be misconstrued as a failure of the sport or the organization running it.

Aqueduct slots revenue is neither a taxpayer expense nor a state gift. Its a key component of the contractual agreement that enables NYRA to run the tracks and the state to lay claim to the land.

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