06/11/2008 11:00PM

New York OTB deal down to the wire


Officials of New York City and the state government are considering a variety of proposals in an effort to avert a shutdown of New York City Off Track Betting Corp. on Monday, representatives of state legislators and the office of Mayor Michael Bloomberg said Thursday.

The proposals include a state takeover of the corporation or a short-term fix that would keep the offtrack betting company operating while a long-term solution is worked out, according to Scott Reif, a spokesman for Sen. Joseph Bruno, the senate majority leader. None of the proposals has gained enough traction to be considered a leading candidate for a solution, Reif said.

"The talks are ongoing and will continue," Reif said. "We expect to resolve this issue before Sunday."

Jason Post, a spokesman for Bloomberg, said late Thursday that the mayor will not accept a short-term agreement, but that his representatives are willing to discuss a state takeover or "any other long-term solution to its funding problems."

"The mayor closed the door on a short-term solution on Tuesday," Post said, referencing remarks Bloomberg made during a press conference that day. "The solution has to be long-term."

Bloomberg has threatened to shut the company's 60-plus parlors and its account-wagering operation as of Monday if the state legislature does not allow the company to retain more of its revenues. Bloomberg and members of his administration contend that the OTB operation will need to be subsidized at that date by city taxpayers if the company's statutory obligations to the state's racing industry are not changed, though that contention ignores approximately $17 million in annual payments made by the OTB company directly to the city in the form of a surcharge on winning bets.

The officials declined to comment on how a state takeover of the company would take place. The takeover could be a temporary measure as the legislature works out a permanent solution to the company's problems, with the state guaranteeing the city a portion of OTB's revenues, according to representatives of legislators.

Because the OTB company's obligations to the racing industry and local communities are set by law, any change must be approved by the legislature and Gov. David Paterson. The legislature was expected to adjourn for the weekend after its Thursday session, but Reif, Post, and Dan Weiler, a spokesman for assembly speaker Sheldon Silver, said that if a deal had not been reached by Friday, representatives of Bruno, Paterson, Bloomberg, and Silver would work throughout the weekend in the hopes of reaching an agreement in principle that could be ratified on Monday.

Representatives of Paterson did not return phone calls on Thursday.

Although Bloomberg has persistently claimed that the threat to close the OTB is not a bluff, the union representing the company's 1,500 workers has raised little opposition to the city's plan, a silence that is highly unusual in New York's labor politics.

The current negotiations are complicated by the fact that any increase in revenue to the OTB company will mean a decrease in revenue to the state, the racing industry, or both. No side has been willing to give up revenue, and the New York Racing Association has said that any large reduction in its payments from OTB would put in jeopardy a reorganization plan the association has filed to allow it to emerge from bankruptcy.