OTB To Vote Today on Closing, With 1,500 Layoffs Possible

The board of directors of the New York City Off-Track Betting Corporation is set to vote today to shut down the gambling franchise, which could result in about 1,500 layoffs and the closure of more than 70 outlets across the five boroughs as early as June.Sources say the OTB board of directors is poised to adopt a closing plan proposed by the president of the Off-Track Betting Corporation, Raymond Casey. Accounts differ as to the financial condition of the corporation, which has been famously described as the only bookie in the world that loses money. Mayor Bloomberg, who controls the OTB board through appointees, is set to shut down the corporation because he says the city has no interest in subsidizing its losses.If the closure goes ahead, it could mark the end of the often seedy storefronts that dot the streets of the five boroughs, and it could deepen the financial troubles of New York State’s horse racing industry, which depends in part on funds from New York’s government-operated betting parlors.OTB pays the state for the right to broadcast races and take bets on the state-controlled racetracks at Aqueduct, Belmont Park, and Saratoga. For the past four years the city has been lobbying the state to rework the revenue-sharing system in a way that would be more beneficial for the city, but a deal announced last week with the New York Racing Association failed to do that.An official with the New York City Off-Track Betting Corporation said last week’s NYRA deal represented the “last straw.” The state Legislature approved a deal that extended the 25-year exclusive franchise rights to the New York Racing Association for the operation of Aqueduct, Belmont Park, and Saratoga racetracks. The terms of the deal also called for $105 million in direct state aid to NYRA, the forgiving of about $120 million in past debts to the state, and an end to NYRA’s ownership land claims of the three tracks.“It looked like every interest in racing got dealt with except for the OTB’s,” the OTB official said. The official said each year OTB pays out $60 million to Albany that acts as a subsidy for NYRA, and by ignoring the city’s desire for a reworked revenue distribution formula with OTB, the legislature was forcing the city’s hand to shut down the corporation.If the closure went ahead, more than 70 storefronts spread across the region would be vacated.“I don’t think anyone wants that to happen,” the chairman of the City Council’s finance committee, David Weprin, said. Mr. Weprin said he blames Albany for the predicament, and he said the revenue distribution plan has made OTB less profitable as state legislators demanded more money from the corporation in the last several years.“Every year the state kept imposing more requirements. The original formula was much more fair and it’s just gotten worse and worse,” he said. “It is not that they are not profitable or didn’t save money. They have been very efficient in their management but it was this formula.”The chairman of the state Senate’s committee on racing, gaming and wagering, William Larkin, said he is sympathetic to OTB. “I think it is very important to have an inclusion for OTBs to be compensated for what they are paying,” he said.Some people are still holding out the possibility that a deal can be brokered before the June deadline. One proposal calls for city’s Off-Track Betting Corporation to make its payouts to NYRA and to the state from their net revenue as opposed to their gross revenues.Mr. Weprin thinks today’s vote could be a tactic to pressure state legislators’ to strike a new deal. “This is not unusual for Albany,” he said. Mr. Bloomberg has been a critic of using funds derived from gambling to help balance state and city finances.“There’s no free lunch here. It may be easier to take money out of the public’s pocket in a lottery than it is in taxes, but it’s still coming out of the public’s pocket,” Mr. Bloomberg recently said in Albany.

OTB To Vote Today on Closing, With 1,500 Layoffs Possible

OTB To Vote Today on Closing, With 1,500 Layoffs Possible

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