01/11/2008 12:00AM

NYRA talks focused on board, slots

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Negotiations on a long-term extension for the franchise held by the New York Racing Association are continuing, but two issues - the legalization of slot machines at Belmont Park and the composition of the NYRA board - have emerged as sticking points, according to participants in the negotiations.

The negotiations are occurring with less than two weeks remaining on a short-term franchise extension that expires on Jan. 23. Any agreement to extend NYRA's franchise on a long-term basis must be approved by New York Gov. Eliot Spitzer, the state assembly, and the state senate. The legislature is scheduled to return to full session on Monday.

Negotiations over the long-term extension are being conducted by representatives of Spitzer; the assembly speaker, Sheldon Silver; and the senate's majority leader, Joseph Bruno, whose wife, Bobbie, died on Monday following a long illness. Though negotiations were conducted in earnest over the weekend of Jan. 4-5, the participants have not discussed the extension since Sunday, officials involved in the negotiations said Thursday, because of preparations surrounding Spitzer's State of the State address on Wednesday and the death in Bruno's family.

According to Scott Reif, a spokesman for Bruno, the current round of discussions is focused on how the NYRA board will be set up and whether slot machines should be legalized at Belmont Park in Elmont, N.Y., a community on Long Island. Bruno's representatives are pushing for legalization and are supported by Spitzer and NYRA, but expansion of gambling is opposed by Silver.

Reif said that Bruno wanted to resolve the Belmont issue before the state's budget is drafted this spring. Slot machines at Belmont would likely contribute hundreds of millions of dollars to the state, though that revenue would not begin accruing, at the very earliest, until 2009.

"We'd like to get a resolution on that, positively," Reif said in reference to Bruno's support for legalization. "But we most want that to be resolved either way before they start putting a budget together."

Dan Weiler, a spokesman for Silver, said that the assembly speaker remains opposed to the prospect of slot machines at Belmont Park. Slot machines are already permitted by law at NYRA's Aqueduct racetrack in Queens - though a casino has yet to be built at the track - and Silver has said that disappointing returns from other racetrack casinos in the state indicate that the market for the machines is not as robust as many analysts believed.

The long-term extension that is being discussed started as a 30-year extension for NYRA's franchise that would give the state undisputed title to the racetracks. According to several officials, NYRA has now indicated that it is willing to accept a 25-year extension, as a concession to allow the association more leeway in determining the composition of its board.

Bruno is pushing for a board that would include several appointees of the legislature and government, which would give political parties an ongoing say in NYRA's operations. Bruno, a Republican, is leading his party's attempt to hold onto a slim majority in the senate this year, when elections for the senate and assembly will be held. The assembly is controlled by Democrats.

In the meantime, the New York Thoroughbred Horsemen's Association has taken issue with a part of the long-term extension that would earmark 6.5 percent of the revenue from slot machines for subsidies for purses. A statement issued by the horsemen's group on Thursday cited "rumors" that the share was going to be even lower, and called on participants in the negotiations to dedicate at least 7.5 percent of the slot-machine revenue to the subsidies.

"It is universally acknowledged that purses define a racing industry and insure its economic health and importance," the statement read.

NYRA is operating under the protection of bankruptcy court, and the association is scheduled to appear in court Monday to ask for an extension to its "exclusive period," which expires Tuesday. During an exclusive period, only the entity that is in bankruptcy can submit a reorganization plan, and NYRA is hoping to get a short extension to allow the negotiations to continue without the potential distraction of creditors submitting their own reorganization plans.

"We just need a little more time so that everyone can get over the hurdles in Albany," said Brian Rosen, one of NYRA's bankruptcy attorneys.

NYRA has already submitted its own reorganization plan to the court, and that plan has been approved by 97 percent of its creditors. The plan, however, is based on a long-term extension, and until the extension is approved by the legislature and governor, the plan cannot be implemented.