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February 11, 2010 - 11:30am
posted by Howard B. Owens in batavia, Batavia Downs, OTB, State Lottery.

otb_board.jpg

The OTB is ready to do just about anything to avoid having the State Lottery pull all of the video lottery terminals from Batavia Downs Casino.

That was the message from Western OTB attorney Timothy McCarthy following a closed session meeting of the board at the casino and racetrack this morning.

"They're the boss and it's important they are treated as such and that we not get in a fight as to what we may have done," McCarthy said.

timothy_mccarthy.jpgWhile characterizing the issues raised by the State Lottery in a Feb. 3 letter to the OTB board as "procedural" and "administrative," he said the board is taking the warning very seriously and will react accordingly.

He stressed that there are no allegations of criminality or missing money.

Before the board went into closed session, McCarthy said a private meeting was necessary in order to discuss possible litigation.

After the meeting, McCarthy said there is no plan to get involved in a lawsuit, but given the nature of the enforcement action, the possibility of a hearing and the need to preserve attorney-client privilege, he thought the private session was necessary.

"We chose not to be pugnacious," McCarthy said. "We chose to try and work with the Lottery. We take the Lottery very seriously. The determination by the board was, 'let's find the best way to keep peace.' The best way to keep the peace is to go hat in hand to the Lottery. There is no benefit to be achieved by being litigious, but nevertheless, that option, as it obviously must, was considered."

McCarthy noted that Batavia Downs has provided $75 million in revenue for state schools since it opened with VLTs (slot machines) in May 2005. The Downs also provides a good deal of revenue to local government agencies.

He said the board will do what's necessary to maintain that cash flow.

"If they (board members) want to characterize it as going to the woodshed, they may very well characterize it as such," McCarthy said.

The board agreed to send a four-person delegation to Schenectady to meet with Lottery officials in order to find a solution to the threat of closure.

Among the Lottery's requests is that the Downs hire a consultant to help put the procedural and administrative issues back in order. McCarthy did not say so explicitly, but the tone and tenor of his remarks indicate a willingness to follow that advice.

The members of the delegation will be Paul Lattimore, from Cayuga County, Richard Bianchi, Monroe, Richard Siebert, Genesee and Marcia Touhey, Orleans.

Previously:

 

September 11, 2009 - 1:00pm
posted by Howard B. Owens in batavia, Batavia Downs, OTB.

A spokesman for the task force reviewing Off Track Betting operations in New York wrote to The Batavian yesterday to say:

With reference to the item on the Genesee County Legislature's opposition to a purported takeover of regional Off Track Betting corporations, I wish to assure your readers that the New York State Task Force on the Future of OTB has proposed nothing of the kind.

Joseph Mahoney, public information officer for the New York State Task Force on the Future of OTB was responding to an article The Batavian posted about the Genesee County Legislature passing a resolution opposing any state takeover of OTB, specifically, Batavia Downs.

By this time, Assemblyman Steven Hawley had been very clear that there has been no discussion in Albany of any such takeover.

What I find curious was the wording of Mr. Mahoney's message to The Batavian. He said there has been no proposal. That leaves unsaid, could there be a proposal?

So I wrote back to Mr. Mahoney and asked that and other specific questions such as, "Is there anything on the table that could, possibly, maybe reduce the amount of local control, control of the current operators?"

Mr. Mahoney's response: Visit our web site

Well, among the first documents I open is the minutes from the group's first meeting, June 25, in which Chairman John Van Lindt is reported to say  that topping the list of possible outcomes of the Task Force's work is "consolidation to achieve cost savings by efficiency of operations."

To me that sounds like centralization of OTBs, which logically implies a state takeover, don't you think?

In the next meeting, Aug. 2, Van Lindt made a motion that requires OTB's to have early termination clauses in any new contracts. That sounds like a prelude to centralizing administration.

Placed on the agenda for the next meeting: "Various options for continuation of OTBs in the state, e.g., joint venture with tracks, consolidate, privatize with or without consolidation, maintain status quo."

OK, so consolidation isn't the only option, but it's on the table.

At that meeting, Aug. 25, during public comment, Charles Hayward, president the New York Racing Association, includes a suggestion to consolidate operations and overhead "(accounting, marketing, insurance etc.)."

So, Mr. Mahoney is right: There is no proposal, at least in a formal sense, to consolidate OTB operations, but the idea certainly seems to be on people's minds.

Mahoney in his initial e-mail:

The goal of the Task Force members is a clear one: They wish to increase the level of revenue produced by OTB corporations -- especially to local governments.

But Mahoney never directly answered this question, and I think it's an important one for the task force to address: "With a successful operation like Batavia Downs, why should the state intervene at all? Shouldn't we assume the current operators know what they're doing and don't need outside intervention?"

Making bigger government entities is no way to increase efficiency or improve profits for the communities that host these operations.

The allegation by critics of the task force is that this is an opening for a revenue grab by the state fueled by the failures of downstate racing and OTB operations. The task force's own meeting minutes are not terribly reassuring that there isn't some truth to that concern.

September 10, 2009 - 1:07pm
posted by Howard B. Owens in batavia, Batavia Downs, OTB.

The state is not looking takeover Off Track Betting operations, Assemblyman Steve Hawley said in a press release today.

“To be very clear, there have been no discussions of a state takeover of OTB and should such discussions arise, I would like all residents to know that I am strongly opposed to such an initiative, especially regarding a takeover of OTBs in Western New York,” said Hawley, who upon learning of the rumors, immediately called Western New York OTB officials to dispel the rumors.

Last night, the Genesee County Legislature passed a resolution opposing any effort by the state to take over OTB facilities, especially Batavia Downs.

Full press release follows the jump:

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