11/23/2005 1:00AM

Hayward: NYRA has right to sell paintings


The New York Racing Association intends to go ahead with an auction of 19 paintings at Sotheby's on Dec. 2 despite objections from the state's racing and wagering board and a state oversight board, the chief executive of NYRA, Charles Hayward, said on Wednesday.

Earlier this month, the chairman of the New York State Racing and Wagering Board, Michael Hoblock, sent a letter to Hayward contending that the paintings were the property of the state. The letter also said that the board would ask the state's attorney general to intervene if NYRA allowed the paintings to be sold without the permission of the board and the oversight panel, which is charged with overseeing NYRA's business operations.

"We haven't changed our position," Hayward said. "We're not trying to be provocative, but it's our position that we own the paintings and have the right to sell them."

NYRA's intent to proceed with the auction, which NYRA officials estimate will raise $2 million for the cash-strapped association, comes when NYRA and state regulatory agencies are wrestling over ways to resolve NYRA's financial crisis.

Last week, the chairwoman of the oversight board, Carole Stone, sent a letter to Hayward outlining several ways in which NYRA could raise cash in advance of the association opening a slot-machine casino at its Aqueduct racetrack late next year. The letter, which was distributed to reporters, asked NYRA to consider raising the takeout on its races, securing a cash advance from MGM Grand, its partner in the casino project, and mortgaging the value of the cash flow on several of its long-term contracts.

Hayward said that he had met with Stone on Monday to discuss issues in the letter, but declined to comment on any details of the discussion other than to say that NYRA was opposed to a general takeout increase. He said he was preparing a response to Stone's recommendations that would likely be sent to her office by late Wednesday afternoon.

"We went through all the points, and on some of them I think we had some agreements, but on others we had to agree to disagree," Hayward said.

John Sweeney, a spokesperson for the oversight board, said the meeting on Monday was held to discuss issues raised in the letter, but said the board would have no comment beyond that.

Hayward also said that NYRA was separately contemplating a 1-point increase in the takeout on win, place, and show bets - from 14 percent to 15 percent - but only if the association received approval to implement a rebate program that would reward bettors with cash back on their wagers. The racing and wagering board has declined so far to act on NYRA's request to implement rebates.

NYRA devised the rebate program with two state offtrack betting corporations, Nassau and Suffolk. The association's former monitor, Getnick and Getnick, which oversaw NYRA's operations for 18 months in 2004-05, urged the racing and wagering board in its final report this year to approve the program.