Updated on 10/11/2011 2:15PM

NYRA to pursue OTBs in New York City

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The New York Racing Association intends to pursue licenses to open offtrack betting parlors in New York City, according to written testimony submitted to a state senate committee by the association’s chief executive, Charles Hayward.

The testimony, which was submitted to the Senate Racing, Gaming, and Wagering Committee on Tuesday, includes the strongest statements yet on NYRA’s intentions to operate OTB parlors in New York’s five boroughs, a politically charged endeavor that needs approval from city and state officials.

In the testimony, Hayward contends that NYRA is best suited to operate the OTBs, and he argues against granting licenses in the city’s five boroughs to any of the five existing OTB companies in New York state, citing the dissolution last year of New York City Off-Track Betting Corp. and the bankruptcy filing this year of Suffolk OTB.

“An analysis of NYCOTB, which is endemic of the other regional OTBs, demonstrates that the parlor distribution system, combined with excessive operational and legacy costs, resulted in its financial demise,” Hayward wrote.

Under a decades-old law, NYRA has the authority to operate up to eight OTBs in New York City, provided it receives approval from the city and state regulators. In his testimony, Hayward said that NYRA intends to establish OTB parlors in “selected bars and restaurants” in the city so that it can “successfully recoup much of the handle that was lost” when New York City OTB closed.

Several of the state’s existing OTB companies also are lobbying to be granted approval to operate in New York City. Despite their financial problems, the OTB companies have considerable political clout in New York.

The Senate Racing, Gaming, and Wagering Committee held a hearing last Thursday in which Hayward was expected to appear. However, Hayward did not attend the hearing after getting stuck in traffic following a NYRA board meeting that morning in the city. At the end of the hearing, committee members asked Hayward to provide written testimony by Tuesday.

In his statement, Hayward said that the OTB companies would be unable to operate profitably in New York City. Additionally, Hayward said that NYRA’s recent efforts to reach out to former New York City OTB customers have indicated that the association is best suited for operating OTBs in the city.

“NYRA should be given the opportunity to replicate this success in [New York City], which is NYRA’s own marketplace,” Hayward wrote.