NYRA, legislature reach agreement

The New York Racing Association and state legislative leaders have reached an agreement on a long-term extension to the association's franchise, averting a possible shutdown of racing at Aqueduct, according to officials involved in the negotiation.

The agreement, which would extend NYRA's franchise for 25 years in exchange for the state taking undisputed title to NYRA's three racetracks, was reached after two days of intense negotiations in Albany. outlining the terms of the agreement passed the state assembly on Wednesday morning by a vote of 92-40, and during the afternoon, the bill passed the senate by a vote of 39-17.

The agreement will bring to a close a tumultuous three-year battle over the fate of the franchise, which includes the right to operate Aqueduct, Belmont, Saratoga, and a yet-to-be-built casino at Aqueduct. NYRA has operated the three tracks since 1955, and a handful of companies lined up to seek the franchise over the past two years, motivated in large part by the casino.

NYRA is operating under a short-term extension that expires today. The Non Profit Racing Association Oversight Board, which has granted NYRA two short-term extensions over the past six weeks, is scheduled to meet on Wednesday night in order to discuss an additional short-term extension that would allow NYRA to operate until March 6. During that time period, NYRA is expected to strike a deal with the state and make the land transfer official.

Under the deal, NYRA will receive $75 million in order to help it fulfill its financial obligations under a reorganization plan the association has filed in bankruptcy court. NYRA filed for bankruptcy late in 2006. The association will also receive another $30 million from the state to fund its operations through 2008, if necessary.

The bill requires the state to select an operator for the Aqueduct casino, which was legalized in 2001. Construction of the casino has been blocked by state officials since the 2001 bill legalized slot machines at eight tracks in the state because of a combination of NYRA's legal and financial problems and the desire of politicians to steer the potentially lucrative casino contract to constituents.

NYRA officials were involved in discussions on Wednesday morning over the fine points of the bill, which changed several times on Tuesday night.

Also under the bill, NYRA's board will be comprised of 25 directors. Fourteen will be appointed by NYRA, while 11 will be reserved for state appointees. New York's governor will be able to appoint three directors, and, in addition, will appoint one director each on the recommendation of horsemen, breeders, state OTB corporations, and unions. The speaker of the assembly will appoint two directors, and the senate majority leader will appoint two directors.

The composition of the board had become a significant sticking point in the negotiations over the final two weeks.

*