03/04/2011 11:10AM

New Jersey sets deadline for Monmouth lease proposals

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The New Jersey Sports and Exposition Authority has a set a deadline of March 31 for parties to submit proposals to lease Monmouth Park and take a 50 percent share in the authority’s account-wagering operation, according to a notice posted on the authority’s website late Thursday.

Efforts to obtain the full request-for-proposals were unsuccessful on Friday, but the notice said that potential bidders will be allowed to submit proposals to lease the Jersey Shore racetrack from its state-owned operator. Bidders will also be asked to evaluate “the assignment of five off-track wagering licenses” and the half-stake in the modest account-wagering operation, 4NJbets.com, the notice said.

Bidders must submit $25,000 in order to review Monmouth’s financial statements and its operating contracts – what are known as due diligence materials – and will also be required to attend a pre-proposal meeting on March 10 at Monmouth. The $25,000 will be refunded if a bidder’s offer is rejected, the notice said. The authority expects to select a winning bid by June 1, officials said.

Several parties have already indicated that they expect to review the materials, according to several New Jersey racing officials who did not want to be identified because they were not authorized to speak on behalf of the companies. The parties include Betfair, the British-based owner of Television Games Network and the world’s leading betting-exchange operation; Jeff Seder, the owner of the Pennsylvania-based

EQB bloodstock agency; and Morris Bailey, a New Jersey horsemen and real estate developer.

New Jersey Gov. Chris Christie has pressed to unload the racing operations from the authority under the contention that the operations have recently cost taxpayers tens of millions of dollars despite $30 million in subsidies from Atlantic City casinos over the past three years. Those ongoing losses – and Christie’s vow to deny the industry any additional subsidies – are expected to limit the number of parties that will be willing to make the state an offer.

Robert Kulina, the general manager of Monmouth, said on Friday that the track operated at a loss last year. However, he said that revenues from the authority’s lone OTB and from the account-wagering operation made the total operation “about break-even.”

“Like any racetrack today, you need to make your money off site or from another form of gaming,” Kulina said. “The tracks that just sell bets are having a difficult time with that business model.”

State law provides for the operation of 15 off-track betting parlors, with the NJSEA having the authorization to run nine OTBs. However, the authority has opened only one parlor, a highly successful facility in Woodbridge that handled $90 million last year.

The state is currently negotiating a lease for the Meadowlands harness track, and that lease is expected to receive the assignment of the remaining four OTBs from the NJSEA’s allotment of nine. The six other licenses are available to the private operators of Atlantic City Racecourse and Freehold Raceway, a harness track.

Although the state’s racing commission has awarded 141 Thoroughbred racing dates for 2011, the racing schedule for this year remains in limbo due to the lease proposal. However, Kulina said that Monmouth expects to open in May regardless of where the RFP process stands.