NYRA bids to keep horse racing franchise

NYRA bids to keep horse racing franchise

	Published : Fri, 06 Apr 2007 17:04 By : Agencies Print this Story

ALBANY, N.Y. (AP) - The New York Racing Association submitted its bid to keep running New York's thoroughbred racing franchise with a cover letter noting it retains its ownership claim to the state's three thoroughbred tracks.

'NYRA does not admit, concede or acquiesce to the appropriateness or legality to the RFP process,' NYRA senior vice president and general counsel Patrick Kehoe wrote.

Its 1,353-page bid 'does not constitute an admission ... that the state of New York has any current or prospective ownership right.'

If the franchise is awarded to another horse racing group, the state and the nonprofit association that has held the franchise since 1955 will likely go to court.

Partly redacted bids by three other groups that want to take over from NYRA were posted Thursday on the Web site of the New York Racing and Wagering Board.

All seek the right to operate Aqueduct, Belmont and Saratoga race tracks and video slot machines at Aqueduct. The franchise held by the NYRA expires Dec. 31. The next franchise holder could run New York racing for up to 20 years.

Other bidders are Empire Racing, a Saratoga Springs group that includes Churchill Downs of Louisville, Ky.; Excelsior Racing Associates, headed by casino developer Richard Fields; and Capital Play, an Australian consortium now based in New York City.

NYRA, which filed for bankruptcy protection in December, said it has almost $313 million in liabilities that the new franchise must assume unless the state is willing to pay. Noting it has failed to generate an operating profit since 2000, and debts inherited from past management, it proposed revamping arrangements with six regional Off-Track Betting corporations, establishing a statewide TV network and marketing campaign and reincorporating as a not-for-profit.

Excelsior was chosen by a Pataki administration panel last year, but Gov. Eliot Spitzer and lawmakers are making a full review before awarding a new franchise. Spitzer counsel Richard Rifkin said the governor expects to make a choice around May 25.

Excelsior proposed $1.875 billion investment, including an aggregate franchise fee to the state of $850 million over 20 years with $200 million of that paid upfront. The proposal listed $480 million for investment in a new hotel and VLTs at Belmont, as well as $300 million for track improvements, $190 million for Aqueduct VLTs and $55 million to fully fund the pension plan.

In its bid, Empire offered two options that it said would provide the state either $1.325 billion or $1.957 billion in upfront lease payments, racetrack and gaming investments and direct payments, while projecting either $11 billion or $20 billion in state revenues over 20 years depending on the option.

The bidders will present their proposals in public hearings April 10-11.

Capital Play, which submitted three financial proposals, proposes more corporate programs, Internet wagering and developing hotel complexes, nightclub and concert venues. The company said it has lined up $250 million from a private equity fund and $550 million borrowing for construction and capital improvements.

One plan guarantees an investment of $1.8 billion in New York's tracks.

Capital Play values its second proposal at $1.5 billion, with lease payments of $250 million upfront and $22 million annually for 20 years. Both options assume 4,500 VLTs will be allowed at Belmont as well as Aqueduct.

It would invest $730 million if VLTs are only allowed at Aqueduct.