04/10/2007 11:00PM

Excelsior stresses plan's casino aspect


ALBANY, N.Y. - Horse racing is a failed sport, the casino operator Steve Wynn told a panel evaluating bidders for the franchise held by the New York Racing Association on Wednesday, and the only way to make it popular again is to introduce people to the sport with the attraction of slot machines and other entertainment.

Earlier in the week, Wynn joined Excelsior Racing Associates, a partnership of real-estate developers and the Johnston family, which has harness racing interests in Illinois, in a bid to win the franchise. On Wednesday, Wynn told the panel that with the right incentives Excelsior would create richly endowed casinos at both Aqueduct and Belmont to revitalize racing, a sport whose time "has been there and is gone."

"We are going to piggyback racing and revitalize Belmont Park by a making of lot of other fun things happen there that people enjoy," Wynn said, referring to the possibility of legalizing slots at Belmont Park, which currently is prohibited from running a casino.

Wynn and other Excelsior officials appeared Wednesday afternoon before an eight-member panel put together by Gov. Eliot Spitzer to evaluate bidders for the right to operate Aqueduct, Belmont, Saratoga, and a slots casino at Aqueduct. The franchise held by NYRA expires on Dec. 31.

Excelsior was the second bidder to appear Wednesday and the fourth and final group in two days of hearings. On Wednesday morning, Capital Play, an Australian bookmaking firm, made a presentation. On Tuesday, the Spitzer panel heard presentations from NYRA and Empire Racing Associates, a partnership of racing companies and New York businessmen.

The Spitzer panel is expected to issue a report in the next 30 days and make a recommendation. Any deal to award the franchise must be approved by the governor and the state legislature, which is scheduled to be in session until June 21. As part of the process to award the franchise, the state's complex racing law will be overhauled.

In part because of its deep pockets and connections, Excelsior has been considered the front-runner for the franchise since late last year, when a separate panel put together by former Gov. George Pataki ranked Excelsior first, ahead of Empire and NYRA. Among its partners, Excelsior includes Richard Fields, another casino developer with political connections.

Wynn, the operator of Wynn Resorts on the Las Vegas Strip, dominated the Excelsior presentation and sometimes displayed an unfamiliarity with the racing industry. At the same time, he made no apologies that his principal interest was in operating casinos. If the state were to allow slots at Belmont, it would give the new franchise holder two of only three casinos in the New York metropolitan area. The third is operated by Yonkers Raceway, just north of the city.

On several occasions, Wynn strongly suggested that Excelsior would be seeking a larger share of slot-machine revenues. The state currently allows racetrack operators to retain about 30 percent of slot-machine revenues, one of the lowest figures in the nation. Other casino operators in the state have complained that the rate does not provide incentives to build world-class facilities.

"You can have a $500-a-day slot machine that makes the state $250, or you can have a $200 slot machine that makes the state $175," Wynn said.

Excelsior brought Wynn and two other colleagues - Steve Roth, the chief executive of Vornado Realty, and Richard Bronson, the chief executive officer of the Bronson Companies - into the group on Monday after several other partners dropped out, including four members of the Steinbrenner family.

Last month, Wynn, Bronson, and Roth said they were interested in bidding for the franchise on their own. But they pulled out, citing an inability to develop a complete proposal in advance of the hearing.

Earlier Wednesday, officials for Capital Play said that if the state legalized slots at Belmont, then Capital would guarantee the state $50 million a year over and above the statutory payments required from slot revenues at Aqueduct and Belmont. Asked later to explain how the company could guarantee such a payment, Capital's chief executive, Karl O'Farrell, said that the group's equity partner, Scotia Capital, had agreed to the guarantee as part of its contract to provide $250 million in financing.

Capital Play estimated that it would generate a 30 percent return on investment to its partners and that each slot machine at Aqueduct and Belmont would generate a net profit of $400 a day.

Later, when the panel asked Excelsior the same question about return on investment, Excelsior officials said that the group expected to get a return of 12 to 15 percent. But when asked if their payments to the state would be guaranteed, Wynn told the panel that nothing in business is guaranteed. Excelsior, like any other bidder, he said, could "write anything down on a piece of paper."

"We're here to offer our services," Wynn said. "And we expect to make a buck or two."