04/12/2007 11:00PM

New York bidders twist reality

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NEW YORK - The four-ring circus in Albany, N.Y., last week that passed for public hearings on the New York racing franchise was above all else an illustration of how fiction becomes accepted as truth when repeated often enough.

The three private-equity groups seeking to replace the not-for-profit New York Racing Association - Capital Play Ltd., Empire Racing Associates and Excelsior Racing - are motivated primarily by the prospect of operating lucrative slot-machine parlors at Aqueduct and perhaps Belmont Park. To get that opportunity to shower themselves and their investors in public money, though, these bidders have to pretend that their real interest is in racing, and that they have quick and easy solutions that will make the sport wildly popular and profitable.

Their arguments boil down to three massive falsehoods:

Big Lie No. 1: Racing in New York has declined while the racing industry is flourishing elsewhere, because of the corrupt management of the NYRA.

In truth, New York has exactly the same standing and prominence on the national racing scene that it did 20 years ago, and its business fortunes have been subject to the same phenomena as every other track in the country. Ontrack business has declined as business has moved to offtrack sites and now into homes. The New York racing product, however, has thrived in the simulcast market, and commands a higher share of the national betting handle than ever.

This doesn't make a compelling case for change, though, so the bidders who want to replace NYRA pretend that something aberrant has happened here, ominously linking it to "investigations" and "legal problems." Even the august New York Times now feels free to describe the NYRA on first reference as "Long plagued by scandals and mismanagement," as it did in a news story last week. A reminder: NYRA's documented criminality amounts to a single low-level incident where mutuel clerks were betting out of the till, something that routinely happens at every parimutuel facility on the planet, and then improperly deducting the repayments on their personal tax returns.

Big Lie No. 2: New York racing will reach new heights by marketing itself to a younger audience and promoting jockeys as star athletes.

In some of the hearings' most embarrassing moments, Capital Play said it would make racing great again by hanging big banners on city buildings and construction sites, while Excelsior's celebrity partners, Jerry Bailey and Steve Wynn, talked about how giant TV pictures from jockey-helmet cams would send the sport's popularity soaring. All three groups talked excitedly about how advertising would fill up the grandstands again, as if this were an exotic and untried idea.

Having additional promotional money from the slots will of course help whoever gets the franchise, but there is not a single example of successful youth-oriented or jockey-oriented marketing in American racing. Bailey, who emerged as Excelsior's racing guru and seemed to dazzle starstruck legislators, actually argued that New York racing's decline stems from its failure to promote him the way that the National Basketball Association did with Magic Johnson and Larry Bird in the 1980's.

Maybe the panelists listening to these presentations, a collection of legislators and bureaucrats with little expertise or experience in the industry, actually believe that people go to the track because of their interest in the personalities of jockeys rather than to watch and bet on horse races. That would be a reasonable conclusion, given the panel's seeming complete lack of interest in issues pertaining to actual racing and wagering, including Empire's and Capital Play's outrageous yet unchallenged plans to jack up the mutuel takeout on customers.

Big Lie No. 3: Slot machines on the premises will attract and convert the masses into racing fans.

This was the thrust of Wynn's bizarre and rambling remarks, in which he called racing a failed sport that could be resurrected only by surrounding it with slots. He said new crowds will come to Aqueduct and Belmont for the opulence of his Vegas-style retail, entertainment, and one-armed bandits, and then turn into racing enthusiasts. Asked precisely how that would work, Wynn said, "Trust us" and "We'll figure it out."

Perhaps between now and its Memorial Day deadline for naming a new franchisee, the panel could try to locate a single racino operator in the country who has found Wynn's scenario to work. They won't find one. Slots provide a welcome subsidy to racing but they do not create racing fans, ando in the long run the sport and its customers become increasingly marginalized and squeezed off the casino floor.

At least one of the panelists has seen it firsthand. John Sabini, a state senator from Queens County, recalled a recent visit to Monticello, a harness track that recently added slots.

He said, "It was almost like the horses were in the witness protection program."