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Saturday, April 17, 2010

It Lives....

So after all the threats about how NYCOTB was about to close down due to the legislature not providing them needed relief, OTB announced they will remain open and for all practical purposes, it will be business as usual. 

Why am I not surprised?   The whole threat to go out of business was merely a ploy to force the legislature to change the rules of the game in order for NYCOTB to survive at the expense of racing, harness racing in particular.  They wanted to stop the dark day payments to the harness tracks, something which was implemented because OTB decided to show night time thoroughbred racing from some minor league track instead of showing the New York harness product.  They wanted to cut the commission they pay all racetracks, including those in New York.  When the legislature did not budge, they magically came up with a plan to continue operating for another year during which time they will work for long term reform, meaning they will continue to work on the legislature to get the changes they want.  No doubt these future changes will apply to all the regional OTBs. 

So in the meanwhile, OTB will operate by delaying payments of statutory payments they are required to make.  Like I said, it will be business as usual.  They still owe harness tracks millions of dollars in statutory payments despite the fact courts in the past have ordered them to make payment.   They may delay paying commissions to out of state tracks (they owe some already). In the meanwhile, they will continue in bankruptcy court, 'working' with the bankruptcy creditors committee in an effort to restructure their finances.

The beast lives.  The racing industry needs to play hardball with NYCOTB in bankruptcy court to make sure they get the best possible deal.  In the meanwhile, the thoroughbred and standardbred groups should do is work together to come up with a plan they can sell to the legislature to get the state back into the business of regulating racing, not stealing the racetracks' business. 

4 comments:

Scott Jeffreys said...

Am I the only reader who was disappointed to read that NYC OTB will continue onwards?

Seriously, the money flow back to the tracks would have been most interesting to see - the racing industry needs to rid itself of the parasitic NYC OTB format and take over the ADW platform as payment in lieu of cash for all the assets owed to the New York tracks.

Instead on getting new data about the state of the on-track game, the NYC OTB brain-crust have realized that they really were going to be allowed to "go under".

Sandy Frucher, realizing the bluff was called, then turns tail and says "well, now we will restructure".

Just let the thing die once and for all. Only then will real progress be made in restoring health to the New York racing game. As things stand now, "much ado about nothing".

Scott Jeffreys said...

Regarding the thought that the beast lives, consider this release from Harness Tracks of America and the second paragraph :

Tucson, AZ --- Sandy Frucher announced over the weekend that Albany had agreed to an “interim plan” which would enable him to keep New York City OTB open and alive for another year after twice announcing its closure.

He says NYC OTB will be smaller, trimmer, and “paying market rates to tracks for their races.” He didn’t announce what market rates were, saying, “I can’t quantify at this point the amount of pain we’ll be inflicting on the racing industry. There will be pain.”


There will be pain? Pain inflicted by NYC OTB on the horse racing industry that OTB itself needs to even have a product to offer?

We ask "why continue the pain?" Liquidate the assets and allow the New York racing interests to operate the Advance Deposit Wagering platform while final ownership can be concluded. There is no reason for the pain to be continued. In fact, now is precisely the time to cut the rope from which NYC OTB is hanging.

Scott Jeffreys said...

As if the pain discussion was not enough, there are more jewels to be considered.

Frucher said NYC OTB would be half the size it was within a year, with half of its 1,300 workforce laid off and dozens of its betting shops closed. Reports from Albany said the proposed 15 percent cuts in payments to tracks would not be part of the solution, but as to monies NYC OTB owes to tracks nationwide, including millions to Yonkers and NYRA in New York, prospects were dim.

“You can’t pay what you don’t have,” Frucher said.


Let's look at this issue. The only thing that Frucher has right in this equation is that you cannot pay what you don't have.

As a consumer, if you cannot pay the price for the goods and services you want or desire, you do without those goods and services.

Isn't the real issue then for NYC OTB to pay only for those signals that it can afford? Frucher will come up with the NYRA signal money in a New York minute if he thought for a second that he could lose that access and be the home of the Beulah/River Downs Ohio 7/7 signal.

This whole situation is just so damned simple - it takes the twisted world of New York's OTB system to make it difficult. Anything that should be so easy that is so hard should be eliminated. Discontinue NYC OTB in its entirety for the good of the national racing scene.

Pacingguy said...

Regarding "Inflicting Pain", what's new? OTB in NY has been inflicting pain since 1971 when the first parlor opened up.