05/06/2010 11:00PM

New York board denies OTB deal with Arlington


The New York State Racing and Wagering Board has declined to approve a simulcasting contract between Arlington Park near Chicago and the New York City Off-Track Betting Corporation until the bankrupt OTB company complies with a request for additional information about its ability to pay out-of-state racetracks, according to a board official.

Joe Mahoney, a spokesman for the board, said that the board believed that budget and revenue projections filed by the OTB company earlier this week with the board were incomplete. The board has asked the OTB company to provide additional information about the projections, and will not approve any simulcasting contracts until that time, Mahoney said.

"Before we approve anything, we want to make sure that New York City OTB can fulfill its financial obligations," Mahoney said.

Arlington Park, which is owned by Churchill Downs, opened its live race meet on April 29. The track's simulcasting contract is the only contract that is so far affected by OTB's request for additional information, according to Mahoney.

Officials of Arlington did not immediately return phone calls on Thursday.

Ben Branham, a spokesperson for New York City OTB, confirmed that the racing and wagering board had raised concerns about the documents the company submitted earlier in the week and said that Arlington was shut off as of Thursday. He said that OTB was developing a response to the board, but would not comment further.

New York City OTB, which is owned by the state, filed for bankruptcy earlier this year. On April 17, the company rescinded a threat to close its parlors and shut down its account-wagering operation as of April 18, and the company has now vowed to stay open for at least another year.

Instead of closing, officials for the company said that they would attempt to work out a reorganization plan with the state and the industries that were affected by the company's operations. As part of that plan, the company said that it would delay some of its payments to the racing industry, though Sandy Frucher, OTB's chairman, said that the company remained committed to fully paying its debt after the reorganization plan was adopted.

The blackout will likely hurt Arlington Park more than the OTB company. Customers of OTB are still able to bet on a handful of Thoroughbred racing signals, including Churchill Downs, Hollywood Park, Golden Gate Fields, and Woodbine, and can shift their betting dollars to the other available signals. However, because New York City OTB is one of the largest sources of betting for an out-of-state track, Arlington Park's out-of-state handle will likely be significantly affected by the blackout.