ALBANY — Gov. David Paterson’s office is working on a new bill to permit the state to loan the New York Racing Association $17 million to $25 million.
The measure is designed to permit NYRA to run the summer meet in Saratoga Springs and pay bills for the now-imperiled Belmont meet that starts next month, the governor’s aides said Tuesday.
The new plan replaces a bill dumped last week as unworkable.
Legislative leaders have had private talks about the legislation but nothing is final, administration officials said. The bill could be introduced as a stand-alone measure or inserted into the next budget extender on Monday, the officials said, emphasizing they hope the loan authorization is approved soon.
Lawmakers "haven’t committed to do it, but we have it ready," Paterson said. "I think they’ll pass it."
While Paterson aides worked on the loan, U.S. Rep. Scott Murphy, D-Glens Falls, called community leaders and horse racing interests to a private meeting before a news conference at Saratoga Race Course.
The group included NYRA president Charles Hayward, who still suggests NYRA will run out of money during the Belmont meet next month. Also on hand were Saratoga Springs Holiday Inn owner Cindy Hollowood and Joe Torani, NYRA’s appointee as chairman of the Saratoga Race Course Local Advisory Board, and breeders discussing their overall concerns about health of the horse racing industry.
Hayward said NYRA needs $20 million — "a small amount given the $90 million NYRA and OTB pay in taxes and fees to the state each year."
Dan Silver, spokesman for Hayward, said the numbers are based on a state report from 2008.
Hollowood, who also is president of the state Tourism and Hospitality Association, said the region already had a difficult tourist season in 2009. She said this year’s August reservations are slow compared to past years, probably because of the uncertainty about the racing meet.
Breeders say they wonder what the future will hold for the sport. Jeff Cannizzo, executive director of New York Thoroughbred Breeders Inc., said 2,200 foals were bred in the state at the peak of New York-bred racing in 2004, a year after Funny Cide won the Kentucky Derby — the first horse bred in New York to do so. Breeders project 1,000 foals this year, Cannizzo said.
Joe McMahon, who owns the farm on which Funny Cide was conceived, said half the foals he brought to the New York sale last year failed to meet their asking price, and their owners chose to withdraw them from the sale.
Michael Shanley, first vice president of the New York Thoroughbred Horsemen’s Association, said even if the Belmont and Saratoga meets go forward, the industry will take years to recover. Horse racing isn’t something one goes into lightly, he said, and thoroughbred owners are likely to race in other states with a more stable industry and higher purses.
In 2008, the Legislature gave NYRA the franchise to run races at Aqueduct, Belmont and Saratoga, and allowed it to emerge from bankruptcy. As part of the deal, the Legislature agreed to loan NYRA money in the event that no vendor was chosen to oversee video lottery terminals at Aqueduct. Almost two years later, that selection still hasn’t been made — and NYRA wants the state to honor its obligation.
A bill proposed earlier this month by Paterson’s office called for NYRA to get $17 million to help pay for previous capital project expenses, as well as expenses going forward. Bond lawyers found those terms impermissible, and the plan was scrapped last week.
The loan envisioned for NYRA will come from $250 million in proceeds from issuing bonds. The money is being borrowed by the state to create the Aqueduct racino. The delay in getting that project developed is one of the reasons NYRA is short of funds; the other reason is the bankruptcy of New York City Off-Track Betting Corp., which owes NYRA about $17 million.
The shortfall, NYRA’s leaders have maintained, could force the state’s tracks to go dark.
"That’s not going to happen," Paterson told reporters after a meeting with legislative leaders at the Capitol. "We have a plan to loan NYRA in the short term money to get through Saratoga, and we’re working on a long-term plan to help them beyond that."
Under the terms in the new legislation, the state loan to NYRA would have to be paid back by March 31 or the state will take some of the association’s cut of video lottery terminal revenues from the Aqueduct racino.