02/08/2006 12:00AM

State hits NYRA with tax warrant

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The state of New York issued a tax warrant against the New York Racing Association on Tuesday that claims the association owes $1.125 million in taxes from a two-month period late in 2005.

The warrant is for taxes on parimutuel receipts from 30-day periods ending on Nov. 15 and Dec. 15, according to a spokesman for the New York State Department of Taxation and Finance, Michael Bucci.

Bucci said that the warrant is similar to a lien, in that the warrant is attached to NYRA's three racetracks in order to "secure the state's interest in collecting the debt." NYRA operates Aqueduct, Belmont, and Saratoga Racecourse through a franchise that expires on Dec. 31, 2007.

Bucci said he could not comment on what steps the state could take to collect the debt, citing department policy. He said he could not comment on whether a warrant had been filed against NYRA in the past.

NYRA's chief executive officer, Charles Hayward, was in Las Vegas on Wednesday attending a racing conference and did not return a phone message. NYRA's chairman, Steven Duncker, also did not return a phone call late on Wednesday.

The unpaid claim for the period ending Nov. 15, 2005 - which included the Breeders' Cup program held at Belmont Park on Oct. 29 - is for $792,973.69, Bucci said. The claim for the period ending Dec. 15, 2005, is for $332,644.24. The state assesses a portion of every bet made in New York as a tax on parimutuel wagering.

In the months that the state claims NYRA owes unpaid taxes, NYRA officials were negotiating with the state on a $30 million loan package. NYRA officials had said the association would file bankruptcy if it did not receive financial help from the state.

NYRA and the state reached an agreement on the package in late December, including a loan for $20 million that still needs to be approved by the state legislature. NYRA officials have said that the $30 million package would allow the association to operate in the black until its slot-machine casino at Aqueduct is up and running sometime near the end of this year.

The tax warrant adds to an already complex effort by the state to offer bids for the franchise to operate the three tracks and the casino at Aqueduct after Dec. 31, 2007. A committee has already begun developing recommendations about how to conduct the bidding process. During two days of public hearings last month, NYRA officials repeated claims that the association owns the tracks and the properties, citing taxes that NYRA has paid since it was formed in 1955.