The Observation Deck
That’s their money, NYRA
December 29, 2011 at 6:00 am by TU Editorial Board
Our opinion: Revelations that the operator of New York’s top
thoroughbred tracks was taking a bigger cut of winnings that it was supposed
endangers public confidence and racing’s image.
a notion that the New York Racing Association would do well to see more of,
would have star thoroughbreds and jockeys in the headlines and the business of
betting on them well out of the news. Because as anyone familiar with NYRA
knows, news about the way it operates has a way of being bad.
And so it is once
again. The state Racing & Wagering Board admonished NYRA last week for
overcharging bettors millions of dollars.
That’s about the last
thing horse racing in New York needs — disclosure of shortchanging the
What would be bad
business for any spectator sport or any gambling venue is that much worse when
it involves an entity so reliant on public subsidies and general goodwill.
The mere thought that
the people betting on the races aren’t getting all their money when they cash
their tickets is one more reason not to patronize a sport whose popularity is
already in decline. The operating margin is scant enough as it is.
It’s important to
note that NYRA is cooperating with the racing board to fix a problem that stems
from how much it keeps from what are fancifully known as exotic bets —
trifectas (correctly picking the first three finishers in a race), superfectas
(picking the first four), Pick 3 (picking the winners of three consecutive
race), Pick 4 (four consecutive races), Grand Slam (picking a top-three
finisher in three consecutive races and the winner in the next race) and
carryover pools for the Pick 6 (picking six consecutive winners).
NYRA, which was
taking 26 percent on these bets — one percentage point more than allowed by law
— will now take 24 percent, giving bettors a bit more. The change went into
Untold millions of
bettors will get refunds totaling $8.6 million — if, that is, they can be
found. Good luck there, NYRA.
And, for good
measure, NYRA will donate $50,000 to a racing-related charity.
“I don’t expect this
will ever happen again,” says racing board member Charles Diamond.
Let’s hope not, even
if that does require accepting NYRA’s explanation for how the takeout and
payout formulas weren’t adjusted when they should have been, some 15 months
ago. As part of its new racing franchise agreement with the state in 2008, NYRA
was allowed to raise its takeout by one percentage point, but the provision
expired in September 2010. As NYRA tells it, the change was “unintentionally
overlooked due to the complexity of the takeout provisions in the Racing Law.”
How hard could that
have been? Isn’t this the age of sophisticated computer technology?
As for the “exotic”
bets part, we can attest how hard it is to pick a trifecta. The idea behind it,
though, is maddeningly simple. It’s not like we’re talking about the mortgage
derivatives that almost ruined the entire American economy a few years ago.
Horse racing will
survive in New York, we hope — just like the financial markets did, bailouts
and all. But it has to be on the up and up, in every conceivable way.