10/10/2008 11:00PM

N.Y. governor's slots pick draws objection

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New York Gov. David Paterson and the state assembly speaker agreed Friday to recommend that the state select Delaware North to run a long-stalled casino at Aqueduct, but the state senate majority leader is blocking the selection.

As of Saturday morning, neither side had budged from their Friday positions. By law, Paterson, Assemblyman Sheldon Silver, and Sen. Dean Skelos must agree on the operator.

In a statement released Friday night, Risa Heller, a spokeswoman for Paterson said that Delaware North presented the "strongest financial proposal" to the state, and she criticized Skelos, a Republican who was elevated to majority leader after the retirement earlier this year of Sen. Joseph Bruno, for blocking the selection. Paterson and Silver are Democrats.

"It is shocking that Senator Skelos, who claims to understand the importance of this revenue stream and who has repeatedly called on the governor to award this contract, has now decided to stall a significant economic development project," Heller said. "Equally troubling is that he has refused to state what proposal he supports and why."

In a statement, Skelos said that Paterson had made a selection that "may not be in the best long-term interests of the state of for the communities that surround Aqueduct."

"It is our belief that unless we make Aqueduct a true destination venue, this project will not generate the largest possible benefit," the statement read.

Slot machines were legalized at Aqueduct and eight other New York tracks in late 2001, but the selection of a casino operator at Aqueduct has hit delay after delay due to political considerations surrounding the extension of the New York Racing Association's franchise to operate Aqueduct, Belmont, and Saratoga.

Delaware North owns Finger Lakes Gaming and Racetrack in Farmington, N.Y., and runs the casinos at Saratoga Gaming and Raceway and Buffalo Raceway. The company is one of three entities seeking the operator's contract. The others are a partnership of SL Green, a New York real-estate development company, and Hard Rock Entertainment; and a partnership called Capital Play that includes Mohegan Sun.

Paterson's office said that Delaware North offered the state a $370 million upfront payment for the operator's license. The SL Green partnership offered $250 million, and Capital Play offered $100 million, though each group also committed to different levels of financial investment.

The Aqueduct casino has been approved for 4,000 slot machines, and most gaming analysts have predicted that the casino would draw $500 million a year in wagers. NYRA officials have said that it would be 12 to 14 months before the casino could be up and running after an operator is selected.