10/30/2006 12:00AM

NYRA rebuffs bailout

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NEW YORK - The New York Racing Association moved a step closer to filing for bankruptcy on Monday after officials said they would reject the terms of a state oversight board's proposal to release $19 million in funds that would keep the racing association afloat through next year.

At an emergency meeting held late Monday afternoon, the panel in charge of overseeing NYRA's finances announced it would recommend to the State Division of the Lottery to release under certain conditions the remaining $19 million of a $30 million bailout package agreed upon last year. One of the new conditions is that NYRA does not file for bankruptcy for a 180-day period.

The condition that troubled NYRA officials was a three-tiered release of the $19 million. Under the proposal, $7 million would be released on Wednesday, $6 million on Dec. 1, and the remaining $6 million on Jan. 1, 2007.

"We told them this morning we weren't going to accept the payment in that three-tiered structure," NYRA senior vice president Bill Nader said Monday. "We had discussions with the governor's staff on Friday, and the spirit of the deal is we got the $19 million this week. That changed today. We told them today that wasn't going to work. I just don't think there's going to be a willingness on our side to accept these terms."

Asked if that meant NYRA would file for bankruptcy, Nader said, "I'd say its one step closer."

A spokesman for the oversight board said Monday that these were the terms under which the board felt comfortable releasing the $19 million.

"We think it's a reasonable offer," said Scott Reif, a board spokesperson. "The oversight board has a responsibility to perform their function. This is what we were comfortable with doing at this point."

Last Dec. 30, NYRA avoided filing for bankruptcy when the state legislature approved a $30 million loan package. To date, NYRA has received only $11 million and was told that it would not receive the remaining money until the State Lottery Commission gave its final approval to a contract between NYRA and MGM for a slot-machine project that would have 4,500 slot machines installed at Aqueduct.

The Lottery Commission has stated that it is still reviewing the terms of that contract.