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Wednesday, June 24, 2015

Cap This

Here's the latest bit of hilarity from NYRA CEO Christopher Kay (at least before Wednesday's board meeting - with this being posted a few hours prior - which is likely to include even more yuks):

"Anyone familiar with Saratoga Race Course will understand the impact of the promotional giveaway days in influencing attendance numbers, which renders inaccurate a direct comparison to today’s gate numbers.

Two years ago, Saratoga hosted four giveaway days and recorded each “spin through the gates” by guests to secure multiple souvenirs as paid attendance. Each of these days yielded an average attendance of anywhere between 50,000 and 55,000. Contrast this to last season when the New York Racing Association discouraged spinners, resulting in an accurate promotional day count of between 25,000 and 30,000 guests during each of the four giveaway days – as opposed to totals of between 100,000 to 120,000 “phantom” guests for the entire Saratoga meet in the prior year. And data from earlier years indicated even larger discrepancies due to the counting of spinners." [Saratogian]
This coming from the man who presided over an equally - if not an even more insidious - padding of attendance numbers last summer, when season pass holders were counted as attending every day of the meet whether they were there or not.  With a total of 6,370 passes sold (though not from day 1), and 40 days in the meet, you can do the math to determine what the potential exaggeration was last year. May, or may not, have been 100,000 to 120,000, but I'd guess that it wasn't tremendously far off those numbers. Of course, Kay did not allude to that little bit of accounting wizardry.  This goes squarely in the category of you can't. make. this. stuff. up.  And I say it's possibly even more insidious than the spinning numbers because, at the same time, this NYRA regime was trying to tell us just how transparent they are.

Kay also announced that, should American Pharoah run at Saratoga - possibly in the Jim Dandy on August 1 - attendance at Saratoga would be capped at an unspecified number.

Oh boy.  Well, as you probably know by now, NYRA capped the attendance on Belmont Day at 90,000, though, as I contended in the last post, they quite obviously didn't even manage to sell that many admissions; all one needed to do was look at StubHub the morning of the race to know that was the case. (And that, by the way, was a major fail.  Can you imagine if the prior regime couldn't sell out a Belmont Stakes with a Triple Crown possibility with a limit of only 90,000?   As was the case last year - and as they bragged to the NYRA Board - NYRA saved money on marketing, letting the news-worthiness of the event do the advertising for them.  Apparently, that publicity did not outweigh all of the terrible publicity garnered by the way they mishandled the bigger crowd in 2014.)

Now, I've seen people who were there say, 'well, I was opposed to capping the attendance, but it worked out!'  Well?  Of course, if one is at a big event and there are not all that many people there - say around 87,000 people in a plant which has handled as many as 120,000 (and better that year than this "big event" team handled a smaller crowd in 2014) - they're going to think 'hey, that was great!' By that logic, why don't they limit the crowd to 60,000, imagine how convenient everything would be!  But, in my opinion, that's hardly the point.  Big racing days draw big racing crowds, and the challenge is for management to accommodate everyone who shows up and make them as comfortable as possible under the circumstances.  The attendance cap was nothing but a copout by a NYRA team that proved itself incompetent the prior year, and which was unwilling to step up to the plate to make the necessary improvements.

Horse racing has been conducted at Saratoga for some 150 years and never, at least as far as I know, has the attendance been capped.  Some of those days have sucked for some people, whether from it being too crowded or too hot or too wet or too whatever.  Yet the track's reputation has never emerged worse for the wear, at least in my experience.  The worst day I can personally recall was the Travers in 1978 when Affirmed and Alydar converged on the old track after slugging it out through the stretch in the Belmont.  Yet, it was a historic day about which I have only fond memories (other than the unfortunate circumstance of the race itself).  I think that people come to Saratoga on big days with tempered expectations as to their comfort level, and with a forgiving attitude.

Harvey Pack used to warn racegoers on rainy days that "You're not going to have a good time today." Yet, how many times have any of you that have been there ever seen a single unhappy face, no matter what the conditions?   And besides, over the years, with advances in technology and the wisdom of experience, the Spa has proven to be perfectly able to handle huge throngs with relative ease.  The fact is that the all the seats are sold on a weekend day anyway no matter who is running, and, as I've discussed and documented here in the past, the overflow crowd is perfectly content to simply hang out in the backyard and watch the races on television.  It's fine.  Always.  (Especially before this NYRA team started to usurp areas where people used to hang out with merchandise tents and hall of fame buildings.)

I can guarantee you that NYRA would piss off far more people should they deny them entry to see a Triple Crown winner than those who might gripe because they couldn't buy a Bud Light.  (And, unlike on Belmont Stakes day, everyone is free to bring in their own swag as long as it's not in a glass bottle.)  And, as far as I'm concerned, anyone who whines about an inconvenience at Saratoga is someone who we don't want there anyway. It's Saratoga.  Just deal with it.  We don't need these ridiculous know-nothings, who came in here bragging about their ability to stage big events - to come in and tell us that only a certain amount of people can come to the track.  It's just ridiculous.

And you know what else?  If, by some chance, 100,000 people descended on the track (extremely unlikely given historic attendance numbers and the geographical and logistical limitations in the area), causing the fire department if no one else to say enough is enough and turn people away, the news stories reporting that turn of events would be the absolute greatest bit of publicity this sport has experienced since just about ever!

 - I've seen some great concerts lately.











Tuesday, June 09, 2015

Now What?

These are my daughters, Chelsea and Kayla, at the Belmont Stakes on Saturday.






















I was not there.  Partly because I had such a miserable time there last year, and mostly for reasons that I'll get into later in this post.  Anyway, if anyone had told me 10-15 years ago that my daughters would be at the Belmont and I wouldn't - especially with a horse going for the Triple Crown - I would surely have figured that it was part of some kind of memorial ritual for their old man!

The big question - considering how bad of a time so many people had there last year - is: did they have fun?  Let's see.





















Guess we'll take that as a resounding 'yes!'  Along with two friends including Amanda (the Panda), pictured in the middle here, they headed to Jamaica station to catch the Long Island Railroad at around 2. They arrived at the track around an hour later with no problems.  They immediately hit the bathroom, no doubt due to consuming all of their drinkables on the train (I offered help in sneaking in alcohol); and reported that the line was long but moved quickly.  Apparently, they had no problem purchasing additional beverages at the track.  After the races, they enjoyed the harmless, though pointless, wimpy pop of the Goo Goo Dolls, and then headed back to the LIRR.  Prepared for the worst by railroad officials and by their dad, they instead walked directly onto a train with no wait, and even got seats.

The combined gross betting handle for the four of them on the day was $1.....though Kayla generously allowed NYRA to retain the $1.75 that her ticket on American Pharoah was worth at the time (it's now apparently worth around $25 on eBay; more if you include some finish line dirt [looks more like a dime bag]).  Kayla is actually a fan; along with my stepdaughter Chloe, she has attended the races with the Head Chef and I on more than just a few occasions, including at Saratoga and Del Mar. They're usually good for about ten bucks a day each (generously supplied by you-know-who) based largely on paddock observation.  Chelsea is not a fan, nor is Amanda (the Panda); but, based on this experience, no reason why they wouldn't go to the Belmont again, especially if a comparable wimpy pop or faux-punk band is playing.  (Or, especially, Diplo, but I don't see that happening anytime soon.) Unfortunately, there were no coupons issued for free admission in the future, guess that's too complicated of a concept for NYRA.

From what I've read, theirs was a pretty typical experience.  Unless I've missed something, aside from a few complaints about bathroom lines (women in the mens room again) and wifi (the girls had no issues with that), seems like everything went pretty smoothly.

That does not mean, however, that I'm here to praise NYRA for the effort. Chris Kay and his minions came into town touting their ability to stage the "big" events.  On that count, they failed miserably last year; both in the execution and the aftermath.  I find it pretty hysterical that the main strategy from this "big day" team was to make their biggest day significantly smaller, by capping the attendance at an alleged 90,000.  To me, handling a big day at the races means being able to accommodate the largest crowd possible by anticipating the worst and having the contingencies in place to deal with an overflow.  Under these controlled conditions, the task was made far easier. Sure, some credit is due; it was still a big crowd; and the music surely helped in controlling the outflow after the races, so that was a good plan. But it was also a huge copout, and the easy way out. And NYRA doesn't actually care if my girls or the other 86,998 or so paid attendees had a good time; only in the sense that they can take a PR victory lap and go before the board with their hands out for raises and bonuses.

And yeah, about that crowd, I don't believe for a single second that NYRA really sold 90,000 admissions; I think they're full of it.  I looked at Ticketmaster late on Friday night, and there was still no 'Not Many Left' designation.  And then, suddenly the next morning, they're sold out? Meanwhile, the prices on StubHub dropped precipitously throughout the morning, settling at around 7 bucks by 1PM (as opposed to the actual face value of more than $22, including all the Ticketmaster fees; great business when you can charge over 50% of the ticket price in fees).  Not only that, the number of admissions available on StubHub was actually increasing; there were some 2600 grandstand admissions and 500 clubhouse admissions available as of 1:30, when I left to join those millions of New Yorkers who couldn't care less about the Triple Crown for a day in Manhattan (while all of the supporting stakes that I couldn't care less about were being run).  Little doubt in my mind that a good portion of that inventory was NYRA's itself; I could picture Chris Kay himself sitting at his computer trying to sell them off.

As for me, I did not suffer from any FOMO; and nor do I have any regrets about not going.  Maybe I'm just too old at this point in my life to deal with big crowds and drunken preppies at a dilapidated racetrack.  One thing I was definitely wrong about though:  I figured that even if American Pharoah won, it would be due more to the mediocrity of the competition rather than the kind of greatness I witnessed when I saw Seattle Slew and Affirmed win their Crowns from excellent vantage points right around the finish line.

However, American Pharoah's Belmont win was nothing short of spectacular.  His final time of 2:26.65 was easily the fastest since Baffert's Point Given in 2001 (2:26.56).  Since the "tremendous machine" stopped the clock in 2:24 in 1973, only Risen Star (2:26.40), Easy Goer (2:26.00), AP Indy (2:26.13), and the aforementioned Point Given ran faster.  And, in this day and age, for a horse to complete the mile and a half by getting his final quarter in 24.32 - faster than any quarter mile of the race save for the opening one - is virtually unheard of.  By comparison, it took Easy Goer and Affirmed/Alydar 25 1/5 seconds to finish the race; Empire Maker 25 3/5; Afleet Alex 24.50.  (Rags to Riches/Curlin came home in 23 4/5; those horses were pretty damn good.  Secretariat got home in 25, but he was just loafing.)  This was truly a race for the ages, and we didn't need the track announcer to punctuate his call by yelling at the top of lungs to hammer that point home.

So now, you have your Triple Crown winner, after all these years and all the anticipation of the day when we would finally see this happen.  Which leads to the inevitable question:



As for the horse, happily, the connections apparently intend to continue his three-year old campaign; though the skeptics who are expecting some kind of benign career-ending injury to soon pop up can surely be forgiven. Baffert has mentioned the Haskell at Monmouth, and the Pacific Classic at Del Mar as possible races leading up to the Breeders' Cup.  That would be awesome.  However, the chances of American Pharoah following in the footsteps of Seattle Slew and Affirmed, and affirming his greatness beyond this year seem remote, to be sure.

As for the industry, the buzz will persist for awhile - obviously, the longer he continues to race, the better - before it dies down and "racing" turns back to the brooding and hand-wringing that has dominated over the last several years.  It's also possible that the hoopla over the Triple Crown will die down (been there, done that), and that this Crown will actually turn out to be a net negative over the next few years as far as publicity goes, as compared to what would have been had the streak started to approach 40 years. But no time for negativity right now.

As for me and my current status as a horseracing fan, bettor, and blogger (and if you care).....the truth is that I haven't been much into the racing game of late, for reasons both professional and personal. I went to Belmont a few weeks ago; it was the first time I'd been to a racetrack since last September, some eight months prior.  I was actually hoping that there, a spark would light and I would rediscover the joy that made me a regular railbird for some 40 or so years.  But, alas, it was not to be.  Belmont Park can do that, as depressingly empty as it tends to be even, in this case, on a pleasant Sunday afternoon; and especially if one ventures inside the mostly-unused plant, where the echoes of the crowd's roar in better times has long since evaporated into the filth and grime that serves to amplify the void. Can't say if I'll be back there anytime in 2015.

I've been involved in the industry due to my involvement with TimeformUS over the last few years. They say that one shouldn't work in a field that one loves, because you may end up hating it.  I wouldn't go that far, but I'm surely disillusioned.  Not free to go into the details here, but let's just say that a lot of industry people talk about what the industry needs, but when it comes down to it, they're full of shit and only interested in themselves.  (Though surely, that does not make horse racing unique....surely!)

And on the personal side, and without going into too long of a spiel (as I've written much of this in the past)....let's just say that I used to find this game a lot - and I mean, a LOT - more fun when it was accepted - and embraced - for what it is. And that is: a game.  And a game in which at least some, if not many, of the participants are scoundrels and rascals who flaunt the rules and push the boundaries of what we consider to be acceptable, both in terms of honesty, and how they treat the animal athletes.  When I first got involved, making the trips to Roosevelt and Yonkers back in the 70's, that was all OK.  In fact, it was part of the appeal.  Nobody I knew really wagered their money with the expectation that this was a totally honest enterprise, and any notion that we might have been scammed was met with smiles and smirks (at least the day after the latest Oscar or Frankie Martin claim won by five, or Herve won six on the night as the other drivers seemed to be pulling back on the reins).  It felt like we were doing something that was more than just a little on the disreputable side, a bit dirty; and I personally found that to be rather thrilling and liberating. Racing Forms were hidden behind the counter of the local newspaper store; and the lack of any pay phones at tracks lent to the feeling that we were in our own private little den of iniquity, cut off from the more legitimate outside world. (Now we cry and whine if we lack total connectivity to the outside world for even a single minute.)

Of course, now I'm much older, so I can't expect to experience those exact feelings at this point in my life. However, it's also largely due to the internet and social media that that kind of perverse joy is gone, in my opinion.  It's funny....I remember as we approached the year 1984, how we were obsessed about the notion of Big Brother watching over us to keep us all in line.  And though that's still a big concern (though one wonders how much we'd know about it today were it not for Edward Snowden), it seems that we've all established our own Big Brother in the form of Twitter and other social media.  Anyone who even approaches the line of what is considered to be immoral or unethical, or who is unfortunate enough to commit even the slightest misspeak, is immediately brought into line, and can easily have their careers or lives ruined immeasurably.

So, now I go on my Twitter timeline and read people bitching about which trainers are cheating with which drugs and how we should cut off their heads!  (So to speak, and probably a really bad metaphor to use at this point in time.)  We must have 72 hour pre-race detention and access to vet reports (snore).  We read multiple live tweeting from the latest conference or seminar regarding levels of cobalt, whether or not Lasix should be banned, how many horses died last week and who/what is to blame.  We read how horrible and cruel it is that a ten-year old gelding is being forced to - gasp - do what he was actually bred to do, and what he looked to me to be perfectly happy doing in winning his last three races before he was effectively ruled off the track by the ethicists who know what is best for everyone.

And we read people agonizing, insufferably in my opinion, about the ethics of the sport.  If I love animals, how can I love horse racing, pondered my friend Teresa (who I hope will still be so after she reads this).  If I was still going to the track, I'd have to discuss that with her at her upcoming birthday BBQ at Belmont over the hot dogs and hamburgers that she generously serves.

Now, perhaps you find it distasteful for me to be trivializing these things. But, to me, none of this is particularly serious in the scheme of things.  It's just a game!  Not only is all of this a bummer, it's boring too.  Not that the industry should not be attempting to cut down on cheating (it will never be completely eliminated, in any endeavor involving money or politics). However, this industry needs to be spending most of its conference, seminar, and hand-wringing time on: How Do We Make This Game Relevant Again Beyond Three Races a Year (two if there's no Triple Crown possibility).  As long as it's spending time on anything other than that at this point, it's a losing battle, as far as I can see.

And as far as the animals go, I wrote here about how, on the scale of cruelty to animals in this world, these horses have it pretty damn good.  In fact, the vast majority of these horses receive more love, care, and respect than a significant portion of the human population.  So I'm not going to repeat myself; you can read that post if you'd like. (Though I will link here with no further comment to the unfortunate tale of the late Allan the rabbit, clubbed to death with a bicycle pump by a Danish radio host in order to make a point; a very fair one in my opinion.)

Look, we are all put on this earth for a short time, and I figure we need to get as much enjoyment out of it as we can.  Fortunately for us humans, we're at the top of the food chain.  As the zookeeper who advised the abovementioned Danish radio host on how he clubs rabbits to death before feeding them to the snakes said: “It’s the animals who are there for us.....Not us who are there for the animals.” That's life; that's the way it is.  And, after all, since video serves as proof these days, we all know for an absolute fact what would be the case if it were indeed the other way around.



Oh, wrong clip (though I couldn't help it).  Here we go:




So, we can just accept this game for what it is - and after all, as I've said many times, if you've gotten past the fact that we breed this animals solely to exploit them for our own entertainment and enrichment, then you really already have - or you can agonize and moralize about it online.  The preponderance of the latter has really turned me off.  Maybe the answer for me is as simple as just not being on Twitter anymore.....or to unfollow all of my racing friends and peeps (but then I'd feel bad!). In any event, the fact is that I was due for a long, long break from this, so maybe it's really just that. Used to regularly take at least a couple of months off every year, but that went by the wayside for many years since I started this blog in January of 2005; not to mention my recent involvement with TimeformUS, in which play becomes work.  So, perhaps it's just fatigue.  And part of it is definitely my distaste for the current cynical corporate know-nothings running my favorite NY tracks. They'll be out of here at some point relatively soon!  Right? Right??  

The Head Chef and I will be venturing out to our favorite spot in Southern-most California this August, so perhaps a couple of days at Del Mar will do the trick (assuming I can tear myself away from the spectacular beaches).  In fact, we'll be there on the day of the Pacific Classic, so, if all goes well, maybe seeing the latest Triple Crown champion will bring me back in full force.  If he's not retired by then.

Friday, April 24, 2015

Casinos Losers Looking For a Do-Over

Here is the letter sent to Gaming Commission Chairman Mark Gearan, respectfully requesting that the state re-open the casino bidding process.  It was composed by an attorney writing "on behalf of several clients" who participated, unsuccessfully (obviously), in the NYS casino selection process last year.



It reads a lot more like a formal legal petition to a court of law than a friendly missive, complete with sections and subsections, footnotes, legal citations, and repeated mentions of ominous phrases like "arbitrary and capricious."

So, one can surely surmise where this is likely headed after the Gaming Commission either issues a polite declination or ignores it altogether.  After all, this attorney is not one who spends her time saying "pretty please," and I do not think she was engaged simply to write a letter.  Michelle Merola is a partner at Hodgson Russ LLP, a prominent name in gaming law.  And, on their website, she is described as a government-disputes lawyer with extensive experience litigating civil and criminal matters in a variety of federal jurisdictions as well as New York State. 
A significant portion of her practice is dedicated to defending corporations and individuals in government investigations, audits, and administrative proceedings related to tax, environmental, fraud, and health care matters. She also regularly challenges agency determinations in New York State courts through Article 78 proceedings.
We've discussed Article 78, in detail, in the distant past; and it is the means by which the Finger Lakes racetrack/racino is challenging the license recommendation to the Lago facility in Tyre, a lawsuit in which Hodgson Russ and Ms. Merola are also involved.

In addition to being an accomplished litigator, Ms. Merola is also apparently more than just a bit of a masochist. 
For the reasons set forth below, the Commission should decline to issue any licenses based on the current recommendations and direct the Location Board to start the entire process anew...
Oh, man.  Can you imagine going through this again, from scratch?  Another round of cheesy presentations of bucolic ponds, designer gardens, and happy families golfing and eating and drinking and laughing and frolicking through the grass or snow and doing everything and anything other than the only reason why they are being lured there in the first place?  Six more months of Kevin Law and Stu Rabinowitz?  I think I'd rather be strapped to a chair a la Alex in A Clockwork Orange and be forced to watch the video of Happy for as long as it took Senate Republicans to allow a vote on Loretta Lynch.  (Well, maybe not quite, but....)  Besides, by the time a second round would be over, the casino bubble may already be shattered to smithereens and we may be on to the next big thing, like......oh I dunno, maybe reading books, or going to the movies. Or the track.

Well, this would seem like a desperate shot in the dark, except that I'd imagine that Ms. Merola has better things to do than to sign up with a lost cause.  The letter delves into the language of the enabling legislation, and attempts to show how the process evolved in a way that violated the "very specific statutory requirements set therein."  It refers to the weighting percentages that the legislation quite specifically directed the Location Board to utilize - 70% for "economic activity and business development factors," 20% to "local impact and siting factors," and 10% to "workforce and enhancement factors" - about which Ms. Merola makes two main points:  1) The board, in fact, strayed from that "required scoring;" and 2) the board added a new criteria after the applications were in.

With regard to the first point, she uses the board's own words against it....words taken from the Final Report issued by the Location Board. 
The Board considered these summaries, its experts’ observations, additional facts and observations the Board obtained through its public hearings and dialogues with its experts and subsequent analyses prepared by such experts at the direction of the Board, in making determinations and reaching conclusions about the Applicants’ ability to advance the objectives of economic activity and business development, local impact and siting and workforce enhancement. The Board did not create numerical scores with regard to the criteria, but reached its conclusions based on a qualitative judgment after careful consideration of all these factors in determining which Applicants would best achieve the objectives of the Act, giving a qualitative weight to categories of factors as the legislature directed in PML section 1320.
"Here," Ms. Merola writes, "[the board] acknowledged that it chose to rely exclusively on a qualitative evaluation, rather than employing the quantitative weighing required by the Act, or scoring the applications in a manner consistent with general procurement practice."

The second point involves "additional criteria" that the board added after the proposals were due.  Specifically, Ms. Merola objects to the added notion that the proposals should address which "would best provide economic assistance to disadvantaged areas of the State." 
For example, the Location Board considered which proposals would best provide economic assistance to disadvantaged areas of the State.
  Oh, the Horror! 
This factor, crucial to a decision about what location to select for an applicant's proposal, was not disclosed prior to the submission of applications and hundreds of thousands of dollars.  And, not only did the Location Board utilize a previously unarticulated factor in its evaluation, but it apparently elevated that factor above all others.  In fact, all of the successful applications share the distinction of being sited in the most disadvantaged areas of the State.
OK, well, here I must diverge from my usual role as neutral and dispassioned observer.  Let's, for a moment, forget the formal letter of the law, and talk about common sense (for whatever that may be worth).  I think everybody, all along, realized that one of, if not the most important, goal of Governor Cuomo in limiting the first round of casinos to upstate New York was indeed to provide assistance to areas of the state that are struggling financially.  In fact, the very first line of the RFA reads as follows: 
Dear Applicant: New York Governor Cuomo has made reviving Upstate New York's long-stagnant economy a priority of his administration.
Get the point?  It's true, we must acknowledge, that the legislature did not do a good job of articulating this in the language of the enabling law.  Indeed, the section describing the 70% weight to economic activity does not specify anything about helping distressed areas.  But it was surely no secret. That's what the governor spoke about when he went to the Catskills the day after the referendum was approved (a speech which was cited critically by critics when attention turned to Orange County).  And it was surely well known to the bidders when they made their oral presentations to the board, as evidenced by all of the segments in their slick videos which were devoted to tear-jerking tales of economic distress and chronic unemployment.  The notion that, had the criteria been stated clearly in the RFA, that the bidders may have chosen different sites is hogwash.  The only thing that would have perhaps - mabye - been different is that the Orange County bidders may not have bothered; but I rather doubt that.  The "hundreds of thousands of dollars" in bidding costs was just pocket change to them, and well worth taking a shot, even a long one, at the riches that a casino location within an hour of NYC would have brought.  And again, they all knew what the implied, if not properly stated, purpose of this exercise was.

So, personally, I would stick to the first point; they're not going to find much sympathy with this one.  In fact, the idea of a company like Genting whining because "the successful applications share the distinction of being sited in the most disadvantaged areas of the State" is rather distasteful, to say the very least.  Based on the crocodile tears for the poor that we saw at the presentations, one might think that the losers would magnanimously be toasting the board for doing the proper thing.

The letter makes some final points; it points to the inconsistency between the board's refusal to recommend a location in Orange County due to the threat of cannibalization, but selecting Lago despite the huge threat of such to neighboring facilities such as the Finger Lakes (based largely on a report commissioned by the Finger Lakes) and Vernon Downs (both exacerbated by the fact that the tax rates on the existing racinos are significantly higher than those for the casinos to which they would lose customers).  It simply and succinctly points out that the winning bidders' projections of revenues to the state lagged behind those of many of the losers; thus ignoring the legislation's directive to maximize revenue to the state.  And finally, it notes the conflict of interest inherent in its outside consultant who had previously worked for five of the applicants, including all three winners.

Again, I wouldn't expect anything to come out of this letter; but we might very well expect it to proceed to the legal arena once the Commission turns its collective noses up at the thought of a do-over.  Perhaps I'll follow up in my next post, which you can probably expect sometime around Thanksgiving.

(Just kidding.)

(Maybe.)

Until that time....Let's Go Rangers!!

Friday, January 16, 2015

Tyre Casino Opponents Heading Back to Court

As all eyes were on the Gaming Facility Location Board as they voted unanimously to re-entertain the notion of a casino in what is considered to be the "true" Southern Tier region, casino opponents in Tyre are gearing up for another attempt to stop the Lago Casino which was recommended for a license for the region instead.  Despite the fact that Wilmorite has not yet been issued a license by the Gaming Commission (and apparently don't yet own the land), it is already building a retention pond in an area away from the main road.  Casino opponents are keeping an eye on the proceedings with a drone, and I received this photo along with a note declaring that Wilmorite is already "destroying some nice woodland and farmland."












As you may recall, the casino opponents suffered a resounding defeat in court when they first filed their Article 78 proceeding against the process by which the Town Board conducted the required environmental review (SEQRA).  I wrote here about the SEQRA process and some of the objections as to how it was conducted in Tyre; about the lawsuit here; and about the verdict, in vivid detail and with an appropriate amount of dismay, here.

Now, CasinoFreeTyre is back with an appeal to the New York State Court of Appeals, with some new legal help and a motion bolstered with new arguments, a multitude of case citations, and a bit of swagger.  It's a good read as far as these things go, so I've embedded it below for those of you who are interested.  For those of you who aren't, the opening paragraph, reprinted below the document, pretty much sums up the substance and spirit of the document.



At the dawn of the SEQRA era, State and local officials rushed through approval of the Carrier Dome at Syracuse University on the strength of a negative declaration of environmental significance.  This Court rejected such an obvious violation of SEQRA's mandates, and in doing so, created the "hard look" standard now embodied in the SEQRA procedures.  See H.O.M.E.S. v. New York State Urban Dev Corp., 69 A.D.2d 222 (4th Dep't 1979).  Now before this Court is a similarly rushed review, for a project of even greater scale than the Carrier Dome - a half-billion-dollar, 450,000-plus sq. ft. hotel and casino with 3,300 parking spaces, and related infrastructure - on the strength of a review notable for its acknowledgment of multiple significant potential adverse impacts, but absent any consideration of those impacts.  If Wilmorite's Lago Casino can pass muster with solely a negative declaration, then this Court should simply declare H.O.M.E.S. overturned and SEQRA repealed. 
(Of course, the Carrier Dome was ultimately built.)  Briefly, for those of you not inclined to dig back into the past posts linked to above, the Town Board, in Part 2 of the SEQRA forms, identified ten items as likely to result in "significant adverse environmental impacts," but then proceeded to gloss over each and every one in summarily dismissing them as concerns in Part 3.  The plaintiffs assert that the Board "failed to take a hard look at the relevant areas of environmental concern, failed to discuss what, if any, mitigation was contemplated to ensure the impact areas it identified as potentially significant would not be, never reviewed the criteria for determining environmental significance, and did not provide any basis for its determination whatsoever."  Again, further details on their complaints, as well as how this SEQRA process is totally stacked in favor of the "lead agency" conducting it (in this case the Town Board), - which is free to interpret the issues in a way that favors their agenda - in this post.

A few points from the injunction:

 - Particular emphasis is placed on the proximity of the casino site to the Montezuma National Wildlife Refuge, a "critical environmental resource," which is situated "in the middle of one of the busiest bird migration routes on the Atlantic Flyway."  It's home to six bald eagle nests; and includes habitats for several other endangered species, including the pied-billed grebe.













Cute little guy, eh?

 - The attorney for the Town Board openly admitted that the board failed to provide the required elaboration on Part 3.  She provided her own text a full month later, and it was sent to SEQRA-related agencies as an attachment to Part 3, even though it was never adopted by the Town Board; not to mention subject to public comment.  The document cites a past case in which the court declares that "post hoc rationalizations are not permitted."

 - The item of potential environmental impact that I've been most incredulous about is the one regarding community character; the fact that the Town Board could so casually dismiss the notion that a giant casino would profoundly affect the character of a tiny rural town.  The motion cites some past cases in which the court agreed with the plaintiffs in that regard, and notes:
The Casino Project Negative Declaration is as dubious as those annulled in the cases cited above - although those were for smaller projects.  The two-year construction of an approximately $450 million casino complex, with significant parking for vehicles and a more than 287,500 sq. ft. building footprint, holding over 450,000 sq. ft. of total space, on an 85-acre parcel of farmland in a rural, agricultural community, will have an "undeniable impact" on the aesthetics of the area.
  - The plaintiffs conclude that since they have demonstrated a "blatant failure" of the town to comply with SEQRA, they are "likely to succeed on the merits of this appeal;" and they request a preliminary injunction to halt construction that would cause them "irreparable harm."  They hope that the case will be heard no later than early next month.  We obviously wish them well.

 - Meanwhile, Jeff Gural/Tioga Downs is, thus far, the only party participating in the re-opened bidding for a casino in the southern part of the Southern Tier.  Still, Gural is going to have to sweeten his proposal, which was rejected in part because it was small in comparison to Lago; especially considering that he would only be adding on to an existing facility.  Guess that cuts both ways, and the fact that he could be up and running in a matter of months did not outweigh size in the minds of the Location Board members.  So, Gural is really piling on those amenities! 
The new proposal will feature more amenities: a second restaurant, a miniature golf course, batting cages and a climbing wall. [Albany Times-Union]
  Oh yeah, that should really do it! 

Look, the problem with this whole thing is obvious to me, and it has nothing whatsoever to do with a putt-putt course and how many extra tens of thousands Gural is willing to throw in here.  He's a polarizing guy to be sure, and I know a lot of people who will brook no dissent as to him being an evil man.  I don't necessarily agree; I think he's an interesting guy and more complex than the villain he's made out to be.  But here, he's tipped the process into the realm of the unacceptable and absurd.  When he was passed over for a license, Gural stomped his feet and whined quite loudly that he spent $600,000 or $800,000 or whatever the real figure was on supporting the governor's referendum and how dare he be rewarded like this.  So, what does the governor do; the same governor who has publicly pledged that he wouldn't interfere in this process?  And who has decried the influence of money in politics?  He writes to the board, asking them to reconsider, and they dutifully go along.  Now, Gural is awkwardly pandering to the board, and this promises to become a cat and mouse game of how little he can add on and still convince the board to recommend a license for him (if that decision has not already been made for them).

Wow, talk about appearance!  We always lament about how people in this state are able to buy influence and favor behind closed doors, but this is playing out right out in public.  Wah wah Andrew, I spent all this money to support you, so I want my license. Oh OK Jeff, sorry, I'll tell my buddies on the board to give you one, don't worry, sorry that this happened.  I mean, I think that they just can't give this guy a license under these circumstances.  Can you imagine all the foot-stomping we'll have  from the entitled in the future if Gural is ultimately rewarded for this kind of behavior with a casino?  And I'd like to produce the negative campaign ad should Cuomo ever decide to run for some kind of higher office.  Man.

 - Opposition to Nassau OTB's plans to build their slots parlor at the old Fortunoff store in Westbury is gathering momentum.  Here's yet another absolutely incredulous development that just does not reflect well on the governor and the process that he helped create.  You just can't go through months of a process that went out of its way to accommodate public comment (if not, as the Tyre casino opponents and spurned applicants know, to accommodate all of the interested parties), and then allow an entity like OTB to summarily and unilaterally declare and decide that they're going to build a casino - or a slots parlor or whatever you want to call it, it's all really the same - wherever they want.  You just can't.  And remember, this slots parlor was not even subject to the referendum vote - the governor's casino law provided for them even if the referendum went down.  So the residents of Westbury have had absolutely no say in this at any point in the process.  Man.

Monday, January 05, 2015

Odds and Ends, Briefly (Kind Of)

Greetings from the spectacularly beautiful island nation of Grenada!  As I'd mentioned, the Head Chef and I are away on vacation to mark a special occasion, and we still have several more days to go.  Once again, a happy, healthy and safe new year to all.  Just checking in with a few thoughts while I have a wireless connection, but will endeavor to be uncharacteristically succinct so I can get back to doing not much of anything at all.. 

Governor Cuomo lost his dad on the same day that he was inaugurated for his second term.  I wasn't much into state politics when Mario was governor, so, by far, I remember him most for his 1984 convention speech, and his flirtation with a presidential run.  His far less articulate son will never be the keynote speaker at a Democratic convention, and likely will never be anointed as the party's presidential candidate at one.  He has however done a graceful job of balancing his comments in the wake of the Eric Garner grand jury decision, the protests that it spurred, and the tragic and senseless cop killings that neither the protestors nor the mayor had anything to do with.  I could go on a bit here....but I'm on vacation, remember?  Having said that, one can surely understand why police officers would be inflamed by the mayor and police commissioner's deference towards Al Sharpton, who built his career by inflaming racial tensions with spectacular accusations when- and wherever he could get his then-fat face in front of a camera (at a time when that didn't come as easily as it does today).  Our buddy and longtime reader jk posted an article from the Post about the Reverend's involvement with bidders for the Aqueduct casino.

 - The governor's letter to the Location Board asking it to reopen the bidding for a casino in the real Southern Tier has the potential to open up a can of worms.  Ulster County Executive Michael Hein wants the board to re-consider a license for the Nevele. 

On a Tuesday letter to the Gaming Commission and its siting board, Hein, a strong supporter of the Nevele plan, wrote: “It is my strong belief, motivated by legislative intent and fairness, that the new round of applications includes the Catskills/Hudson Valley Region, not just the Eastern Southern Tier/Finger Lakes Region.” [Daily Freeman]
The Nevele was the only unsuccessful bidder in the Catskills/Hudson Valley region that was singled out in the board's final report; it noted that their financing was not complete.  Hein noted that, back in the day, competition in the Catskills "was not a detriment, but rather fostered broad commercial success among a network of resorts."  I imagine that Mohegan Sun and Louis Cappelli, rejected in their bid at the Concord, would share these sentiments as well.

This article, which I found at the Ithaca Journal site, is chock full of information about the tracks that are likely to be negatively affected by the controversial casino in Tyre; the non-Southern Tier selection in the Southern Tier region.  Could go on extensively about it if I wasn't....you know.  It's worth a read if you're interested in the subject.  In summary though: Finger Lakes is screwed.  In another example of something that those who wrote this law and created the gerrymandered Southern Tier region obviously didn't think about:  Finger Lakes, only 27 miles from where Lago is supposed to be built, will not have purses supported by the Lago casino at 2013 levels because it is in Region 6.  But Tioga Downs, which is nearly two hours away, will receive purse support because it's in the same Southern Tier region.  Go figure that one out.  Estimates as to how much business Finger Lakes will lose range from 21% (the study commissioned by Lago) to 50% (the track's estimate).  Guess we can figure the real damage will be somewhere in between.

 - Business is brisk for commercial real estate developers in Schenectady now that casino gambling is coming there. 
Among those looking to benefit are property owners on a stretch of Erie Boulevard west of the casino site that has a hodge-podge of businesses and buildings, some of which are run-down, empty or not fully utilized. [Biz Journals]
All well and good....but these folks are presuming that the casino customers are going to stray outside the gaming floor that the Rivers Casino will be doing their best to keep them at.  So, that's one of the many assumptions about these casinos that we'll just have to wait and see how they turn out.

 - Nassau OTB has settled on the old Fortunoff's building on Old Country Road in Westbury for its VLT parlor.   Those of you from my generation who grew up at the NY harness tracks know that Roosevelt was right there, so the location is more than just a bit ironic.  It's also infuriating to some residents of the area. 
Some local residents told Fox 5 it doesn't belong there and that they fear increased traffic and crime.  The issue has even taken to social media with a Facebook page called Stop the Casino at Fortunoff. It has more than 1,700 likes. [MYFOXNY]
That all sounds quite familiar from the recent casino bidding.  What is quite different though is that these residents didn't have a chance to express their concerns directly to the decision makers like those in the cities and towns targeted for casinos did (for whatever that was worth for those in Tyre).  So, you can't blame those opposed to this gambling facility for being outraged.

 - And finally, I noticed this photo essay in the Times.
Thoroughbred horse racing provides one of the great American spectacles: the magnificently chiseled athletes, the elemental contest of speed and power, the libidinal rush of personal fortunes won or lost by the margins of a split second.  The photographer Theo Zierock, who spent last winter shooting Aqueduct Racetrack in Queens, found none of that. What he found instead was a decaying building populated by lonely old men.
Well, first of all, I have to presume that "last winter" means a year ago.  So, in addition to its appearance at this time being totally random, there have been improvements made to the facility since then; so that it's a bit less of a dump now than it was then.  More importantly, it seems to me that if the photographer Theo Zierock really wanted to take photos of magnificently chiseled athletes, the elemental contest of speed and power, and the libidinal rush of personal fortunes won or lost by the margins of a split second rather than of lonely old men, he surely could have done so.

I myself have not been to the Big A since it opened in the fall; and, believe it or not, I can honestly say from this paradise that I don't miss it at all.  I wouldn't call it a boycott.  I just don't want to go there. 

When I first started writing this blog ten years ago this month, this was one of my favorite times of the year to go to the track in NY.  Forget the dismal inner track racing; I'd get there at 4 PM and spend the rest of the afternoon/early evening betting on races from Gulfstream, Fair Grounds, Oaklawn, Santa Anita, and just about whatever else was offered.  Can't say how many other people were there in the back rooms of the second floor of the clubhouse; but the atmosphere was crackling.  It was hardcore, but in a comfortable, if not elegant, setting.  Over the last decade, with the continued deterioration of the plant - particularly in my second floor hangout, where the only attention paid was the unfortunate decision to install those horrible desk units, which totally changed the ambiance for the worse- combined with the ease of wagering at home, it has become a place where I don’t particularly want to spend the afternoon.  I can't really remember the last time I walked in and wasn't wondering, within an hour, why the hell I was there.

I know, it's been prettied-and-cleaned up.  But a prettied-and-cleaned-up dump is still a dump. And the old haunts on the second floor is the pleasantly functional Longshots bar that they now want even NYRA Rewards members to pay $5 to enter.  I find that I just don’t want to pay that.  It's not that the five bucks is gonna make me broke.  I just don't want to pay it.  Nor do I want to pay for overpriced food and drink.  I'm just not interested in being an ATM for these guys in their pursuit of the mythical "profitable without slots" holy grail. 

As we've noted, this whole notion of being "profitable without slots" is just a number on a piece of paper that means nothing in the real world.  NYRA is dependent on slots revenue to support the purses that they use to compete with other slots states, and to promote their "big days," scheduled to be even bigger this year (oh joy).  The slots revenue earmarked for capital projects allows NYRA to modernize their facilities in ways that facilitate increased revenue, mutuel and otherwise.  And it no doubt helps to lessen the occurrence of maintenance and repair problems/emergencies that they'd have to pay for out of their operating expenses.  So the idea that a number on an income statement means that NYRA could truly be profitable without slots is a fictional one.  However, it is a number that will earn Chris Kay more bonuses and be highlighted on his resume when he moves on to his next gig.  I do think that Kay is earnest about wanting horse racing to prosper in New York.  But we also know that this is merely a step in his corporate career, and success, even if defined on his own terms, would be quite the feather in the cap.

None of the above is to belittle the pursuit of a NYRA that is able to prosper without the miserable machines next door, even though the political pressure to do so seems to have eased, at least for now. The last regime wanted to move in that direction organically, by replacing the void left by NYC OTB. This regime is doing so by trying to bleed the money from its customers.  Speak to you again soon.

Wednesday, December 31, 2014

Cuomo Seeks A Do-Over

When the Gaming Facility Location Board announced their three casino license recommendations a couple of weeks ago, we acknowledged that the process appeared to have been independent of outside influence - particularly that from the office of Governor Andrew M. Cuomo - and admitted that we were wrong to predict and insist that that would not be the case.

But now, instead of interfering with the board's deliberations and decisions behind closed doors while the process was ongoing, the governor is doing so right out in the open, asking it to reconvene and reconsider its refusal to issue a license to the Southern Tier....the "true" Southern Tier, that is. 

"The Binghamton area is tied for the region with the highest unemployment rate in upstate New York, and stands to benefit greatly from new jobs and economic development in the region," the letter states. Cuomo wrote that he wants the siting board to consider issuing a new request for application "to seek a qualified applicant to submit a new bid" for the fourth license in the "true Southern Tier." [Albany Times Union]
  The governor is trying to get a do-over.  You know.  A do-over.  You remember.  When the whiny and entitled kid in the street or playground pick-up game would demand that a play that didn't go his/her way be re-played.  "I wasn't ready!"  "I called time out!"  "The ball hit the wire!"  "A car was coming!"  "Sally farted in my face!"

In this case, the lead crybaby was Jeff Gural...though, to be fair, he was leading a chorus of complaints from not only those in the Southern Tier who felt they were bypassed unfairly and unwisely, but from those who questioned the decision from around the state as well.  And we don't at all disagree with those cries.  The decision to award the Southern Tier region license to a location well north of it - one which is already filled with gambling options; and in a little rural town where opposition to a casino is adamant  - was a baffling one, no doubt.

But the problem is this: Cuomo's letter to the board comes not long after Gural, acting like the entitled crybaby that some consider him to be, ranted and raved like....well....an entitled crybaby. 
  ""Um, I was asked to help get the law passed. I spent about $800,000 of my own money to get Proposition One passed, only to get put out of business. I mean, I, I think it’s a joke to be honest with you."
.......
"And what really pisses me off is the governor asked me to spend $800,000 of my money to pass Local Law 1, Proposition One? What was that all about? I mean—why would—the whole thing is sickening to be honest with you." [Capital New York]
So, for the governor to react shortly thereafter by appealing to the board - which is made up of a co-chairman of his first gubernatorial campaign, another former campaign aide who he later appointed to chair a state agency, two gentlemen who he appointed to their current co-chairmanships of a regional economic development council, and another whose wife, a current Westchester District Attorney, he once appointed to head a prominent ethics committee - to let the crybaby get his way, seems rather inappropriate.  Though hardly atypical or surprising.  Sure, Cuomo's letter couches his intentions in an effort to "excite national competition by interested parties that submit even better applications than the first round." But nobody really believes that any parties other than Gural and Tioga Downs would be interested in a region in which no outside companies were interested even before Atlantic City casinos started going broke, making it increasingly apparent that the northeast is over-saturated with gambling facilities.  Nor that this is anything other than a direct effort to set things right with a person who actively supported one of his key initiatives with his mouth and his money.

The governor, having sat out the casino selection process, contrary to every bone in his body and perhaps due to federal investigations into the Moreland Commission which we have good reason to believe are underway, can no longer help himself.  If the board's recommendations served to quash your belief that there were no stated or implied understandings whatsoever when the NYGA agreed at the last minute to not oppose the casino referendum, these developments should serve to make you think again, as I have.  And, again, none of this is to mean that, strictly on the facts on the ground, Cuomo is wrong to ask the board to reconsider what would indeed appear to be a questionable omission.  It's just that the way it has come about, and considering these persons involved, as well as the history of inside dealing behind closed doors that Albany, and this administration in particular, is notorious for, makes it all seem quite unseemly.  To put it one way.  Though equally quite typical. 

 - The Head Chef and I are currently down in Florida; and, as we are marking a special celebration as the calendar turns to 2015, we will be headed towards climes even further south of here on New Year's Day for an extended vacation.  So, I'm thinking that you likely won't be hearing from me for a bit!  A Happy, Healthy, and Safe New Year to all, and thanks, as always, for your readership and support.

Tuesday, December 23, 2014

Expected Reactions in an Unexpected Place

The language in the reactions we heard last week regarding the selection of the Lago Resort & Casino in Tyre was the kind that we thought we might be hearing from aggrieved casino supporters in the Catskills had licenses been issued to Orange County applicants instead.

"Something's wrong," Broome County Executive Debbie Preston said. "It's a slap in the face to the people of Broome County and the people of the Southern Tier." [PressConnects]
.......
State Sen. Catharine Young, R-Olean, called the news "a punch in the gut to the Southern Tier." [Syracuse.com]
.......
"To not pick a Southern Tier location — Seneca County, in all due respect, is not in the Southern Tier," [Sen. Tom] Libous said. "I'm extremely upset. I'm very, very disappointed." [PressConnects]
.......
A day after the casino vote last year, Cuomo showed up in Binghamton and applauded the addition of new licenses as he stood in front of a podium with a sign that read: "Funding for Schools ... Jobs for the Southern Tier." [PressConnects Editorial]
Well, no casino jobs for the Southern Tier; at least what those living in that part of the state would consider to be the Southern Tier.  As in....the actual southern tier.  The above-referred-to editorial continues:
As Cuomo said at the time: "We're losing over a billion dollars to the neighboring casinos — New Jersey has casinos, Pennsylvania has casinos, Connecticut has casinos." 
Cuomo was right.

If a Binghamton resident decides to go to a full-service casino, that gambler likely drives 76 miles south in Pennsylvania to the Mohegan Sun casino in Wilkes-Barre. After all, Turning Stone Resort and Casino is 87 miles north. Others in New York are even farther away.
Of course, not everybody up in the Finger Lakes region is thrilled about the decision either....especially those in Tyre who have been trying to block the construction of a casino there.  The CasinoFreeTyre group, unsuccessful thus far with their legal actions, will try again; this time, asserting that the developers' plans grew larger between the time that they were, controversially, approved by the Town Board, and the time that they were formally submitted to the Gaming Commission. That may sound like a technicality.....but recall that a judge ruled in the previous lawsuit that the town was not required to post the SEQRA forms on their website because it didn't have a high speed connection.  So maybe technicality is a language the court will better understand than it did common sense.

And the horsemen at the Finger Lakes warned that a casino in Tyre could put the track out of business.  
 If actions are not taken by state officials to protect purse account levels and avoid a drop in state tax rates paid by the state, Brown said "racing at Finger Lakes will be gone in two to three years." He said 90% of his 500 members could not stay in business if purse levels drop below the $20 million or so mark they've been running in recent years. [Bloodhorse]
Kevin Law, the chairperson of the Location Board, told reporters that the decision was between Lago and nothing....prompting Jeff Gural to call that the stupidest statement I've ever heard anybody make in my whole life. And, in that interview, Gural again demonstrated the sense of entitlement that he had about this process.
"I finished the garage. I spent a quarter of a million dollars on Winterfest, thinking I would get the license. And I got screwed." [PressConnects]
In an absolutely delicious bit of irony, Gural is conducting a joint press conference on Tuesday morning along with Traditions at the Glen, the other unsuccessful applicant in the so-called Southern Tier region.  There - and I am writing this before the press conference whereas you are likely reading this afterwards - he and Traditions are reportedly set to announce a joint effort to win the 4th casino license which was expected to be awarded in the Catskills/Hudson Valley region, but which was withheld by the Board. You may recall that Gural had previously scoffed at the notion of a cooperative effort with his competitor when it had been raised by Traditions CEO Bill Walsh a few months ago.  
"We don't see any kind of partnership down the road at all with Traditions, and I think that our chances of getting the license are pretty excellent," said Gural.
...........
"Truthfully, I think if (Traditions owner Bill Walsh) won the bid, he would go broke," said Gural. "I told him that. I don't think that there are enough customers for both of us." [WBNG]
Well, as Gural most colorfully informed us last week, he's wealthy and is in no danger of going broke himself.  Unexpected developments often bring unexpected bedfellows.  And I guess Gural has changed his mind about there not being enough customers to go around.

Thursday, December 18, 2014

Location Board Gets Two out of Three (Not Four) Almost Right

The Gaming Facility Location Board has spoken, and no, their decision did not favor the politically connected bidders as I'd anticipated would be the case.  If there was a backroom deal with members of the New York Gaming Association in the weeks preceding the referendum vote in November, 2013, it was obviously scrapped and left on the editing room floor.  Jeff Gural, the owner of Tioga Downs, and James Featherstonhaugh of Saratoga Raceway and Casino are both left without their coveted casino licenses. Instead of sticking to the script of intervention, influence, and interference which is well worn in Albany, particularly with the sitting governor of New York, the board did their job earnestly and independently, so it seems.  I'm happy to admit that I was wrong, though I will offer no apologies for the nature of my suspicions.

That said, I don't think that the location board got this all right.  And they surely showed zero sense of drama!  They led off with the most anticipated aspect of their decision, revealing right off the bat that there would be only three license recommendations, with none of them awarded to an Orange County bidder.  Which, as you may recall, wasn't really the idea in the first place.  Not sure what the point of that entire Orange County exercise was, other than to cause a lot of angst and a lot of wasted time, effort, and money on the part of those who mounted bids for a facility there (including money that was directed to well-connected lobbyists and to politicians' campaign funds).

It also appeared as if the board didn't succeed in keeping their decision entirely to themselves.  Trading in the stock of Empire Resorts, set now, pending final licensing by the Gaming Commission, to be the operator of the Montreign casino at the old Concord resort in Thompson, NY in Sullivan County, was frenetic in the days leading up to the decision.  The stock (NYNY, and I still don't understand how they got that symbol!), flirting around 6 1/2 on Dec 12, rallied to 8 on Tuesday on heavy volume.  (It soared to 9 after the announcement before selling, and perhaps some buyers' remorse, took hold and drove it down to 7.13 by the end of Wednesday's trading session.)   And I was surprised on Wednesday morning to see that I was now being followed on Twitter by Galesi Group, who teamed with Rush Street Gaming on the winning bid for the Rivers Casino and Resort in Schenectady.  Perhaps that didn't mean anything, and I don't mean to be presumptuous enough to think that anyone there or anywhere really cares about what I write or think; but I wouldn't think that the folks at Galesi would be curious to see what anyone had to say on Twitter if they didn't think they were going to be selected.

The third license, awarded to Wilmorite for their Lago Resort and Casino in Tyre, is where I think this board really went off the track, ethically and logistically.  We'll get to that in a moment.

The recommendation for Montreign is surely no surprise, even to those who weren't trading NYNY stock, given its location in the Catskills, an area which has been practically begging for casino gambling for decades.  It's a lavish proposal with all of those amenities which we're told will attract gamblers to travel to upstate NY from NYC and beyond; an unproven concept which has no precedent here.  Just go their homepage, roll over the letters as instructed to see all of the nonsense intended to dazzle and distract from the facility's true purpose - to get people onto the gaming floor and keep them there as long as possible.

I have some mixed feelings about their selection.  Of all of the regions that were considered, the Catskills is surely the one which warranted a casino given its history as a faded resort area, the enthusiastic support there, and the long effort to bring this to fruition.  So, even as someone who opposes the whole idea of expanding gaming in the state, it's hard to argue with this location.  And it's great news for the horsemen at Monticello, who recently concluded a deal with management which depended on Empire getting the casino.  It guarantees the existence of the racetrack for the next nine years, and grants the horsemen, in lieu of a share of casino revenues, equity in the company (which they may wish they had when the stock was at 9 yesterday).

On the other hand, Mohegan Sun's proposal for a casino on an adjacent slice of the Concord property seemed slightly less cynical and insincere than most of the others in the state; and may have provided more wide-ranging benefits in the region.  The company's CEO, Mitchell Grossinger Etess, has family roots in the area, and may really have cared about revitalizing it instead of just paying lip service to the idea in order to line his own pockets.  His proposal would have included a revival of Grossinger's (which the Etess family used to operate), as well as commercial development in the city of Monticello.  (Etess said afterwards that he is "happy for Sullivan and wish Montreign the best of luck.”)  In its explanation of its decision, the board did not specify any negatives about the Mohegan Sun proposal (as opposed to the Nevele, which it noted had not completed its financing); only that Montreign is "a more comprehensive and well-measured proposal."

Schenectady was also no surprise; indeed, the rumors that it was the leading candidate had been swirling for weeks.  It fits the bill in that it's a city that has struggled financially (though already in the process of a revitalization); and the location, along the riverfront on a long-abandoned industrial site, seems a logical one; it doesn't sit squarely in a residential area like others will or would have.  However, the sentiment was hardly unanimous in favor of the casino; there was opposition to the proposal there.  Didn't cover it much here, and, in fact, when I did, I got yelled at by someone from the group for belittling the notion that the casino would prey on students at Union College (from which I graduated a really long time ago).  Indeed, the school again expressed concerns after the decision.

Personally, while acknowledging the proximity of the campus to where the facility will be and the potential to lure students, I still think that the casino presents more profound problems than preying on students whose parents are spending $60,000 a year to send them there; I'd be more concerned about the community college myself.  The Stop the Schenectady Casino group, seeming resigned to the decision on its website, outlined some of those concerns, particularly those of problem gaming, and the need to "protect the Historic Stockade neighborhood from an increase in traffic that will almost surely reduce the quality of  life in the neighborhood, and threaten the integrity of its historic structures."  (Preserving that neighborhood was the original goal of this group before they pivoted to the casino.)

That brings us to Tyre.  Along with East Greenbush, where Saratoga harness' proposal, led in part in a most arrogant posture by Morgan Hook of the lobbying firm SKDKnickerbocker, was most rightfully denied in the face of the fierce opposition there (though the board would only acknowledge that "the level of public support....was significantly less" than the other proposals), Tyre was where I heard the most from residents terrified at the prospect of a casino destroying the nature of their residential area.  I feel terrible for the people there who will be affected.  Imagine living your life in a quiet area, minding your own business, and some millionaire dude comes along to plop a 24 hour casino right next door.  I wrote extensively about Tyre in this post, and here I'll once again post the Google Maps satellite views - one closer and one wider - of the rural area where this casino would be built.




The red sign post is where the Dawley family lives, and, should this casino indeed be built, their lives and those of their neighbors will surely never be the same.  The residents have mounted court challenges which have thus far been entirely futile.  They've targeted the environmental review process (SEQRA) which, as we detailed here, is designed to be manipulated by the "lead agency" - in this case, the town itself - to fit its agenda.  The Town Board members simply declared that the casino would have no significant environmental impact on community character, and - poof - it became so. One need only to look at the above photos to realize that that assertion is nonsensical and self-serving.  So, we hope that the community will endeavor to carry on their legal challenge.  It seems unconscionable that the location board would allow a casino to be constructed there.

And that's besides the fact that this award to the Southern Tier region is not actually in the southern tier of the state, as we discussed here.  Despite the fact that Governor Cuomo again reiterated yesterday that these casinos will act as a "magnet" to lure New York City residents to Upstate destinations, I can virtually assure you that no one - and I mean nobody - from the city is going to be traveling up to Tyre to gamble, I don't care how many scenic lakes there may be.  (And in fact, I highly doubt they would have traveled to one at Tioga Downs either....and it surely remains to be seen if they do so to the Catskills or Schenectady).  It's been estimated that as much as 80% of the business in Tyre will simply be gamblers relocated from Turning Stone or Vernon Downs or the Finger Lakes; and though that's a self-serving estimate by Turning Stone, it makes far more sense to me than the idea of a family trip from Manhattan.

As you might imagine, Tioga Downs' owner Jeff Gural is not very happy about this.
“I’m totally shocked. I really am. I didn’t think that, first of all, I didn't think that they belonged in the competition, they’re not in the Southern Tier..

“The governor came to Binghamton and announced this and promised the people of the Southern Tier a casino....Um, I was asked to help get the law passed. I spent about $800,000 of my own money to get Proposition One passed, only to get put out of business. I mean, I, I think it’s a joke to be honest with you." [Capital New York]
 Note here that the amount that Gural spent to get the referendum passed has suddenly gone up from $600,000!  And here we see the sense the entitlement that Gural, and surely also Feathers, had about this.  And he went on, and on, and on....
 “It will hurt me at Vernon. But, I don't give a shit about me, I’m wealthy."
....
"It’ll hurt me at Vernon eventually. I wouldn't be surprised if Finger Lakes closes. This is a devastating impact on the racinos in the state that have provided millions of dollars to the state and our thanks is this idiotic decision? It’s a disgrace. No fracking and no casinos? Why don’t you just tell them they should all move someplace else?”
....
“I mean I was concerned, to be honest, that they had a committee of people who knew nothing about the industry, and that’s what you get, you know? I think they’re well-intentioned, but how, they certainly screwed Turning Stone and they put Finger Lakes out of business. They probably put Vernon Down out of business. So basically, they put two casinos out of business and screwed the third one.”
.....
"And what really pisses me off is the governor asked me to spend $800,000 of my money to pass Local Law 1, Proposition One? What was that all about? I mean—why would—the whole thing is sickening to be honest with you."
 The reference to fracking is with respect to Cuomo's announcement that he will ban the practice in the state; curious that he would make that long-anticipated decision on the same day as this one!  Not sure which one he was trying to distract attention from!  (Of course, I'm sure there are some, if not many, in the Southern Tier who believe that yesterday's developments saved them from the ill effects of gambling, air pollution, and contamination of the water supply.)  In making the fracking announcement, Dr. Howard A. Zucker, the acting state health commissioner, noted that his review boiled down to a simple question: Would he want his family to live in a community where fracking was taking place? [NY Times]  That's obviously not the approach that the location board took in deciding to site a casino in the residential town of Tyre.

Tuesday, December 16, 2014

It's Show (and Tell) Time for Location Board

It's a busy time of year, so sorry again for the sparse posting of late, as the announcement of the Location Board's recommendations in the casino sweepstakes fast approaches.

However, the action will really just be getting started once Kevin Law tells us who the winners and losers are (and it's subject to one's interpretation as to whether the winners are the winners or the losers) some time shortly after 2 PM on Wednesday.  The reactions from the developers and the communities will surely span the full gamut of emotions ranging from euphoria to rage, and either, or both, will likely be heard and felt from winners and losers alike.  Some will appeal directly to Governor Cuomo, questioning how the results comport with the spirit of the casino law. Some of the bitterness could spill into the legal arena.

Then the Gaming Commission will begin their process of assessing each of the recommended candidate's licensability, with the help of the State Police.  As I've pointed out, recent history suggests that the ultimate result could differ from what these gentlemen come up with on Wednesday; I'd rate the chances at around 25% that that turns out to be the case.  That phase will be another chance for the meddling governor to meddle.  This location board is one thing.  Despite the fact that it's comprised entirely of men with past ties to the governor - some more so than others - they seem to be earnest about their task, and we can only hope that the two members, at least, who I'd surmise are certainly on Cuomo's contacts list haven't been getting gubernatorial texts in the middle of the night.  But the Gaming Commission is Cuomo's commission. If, for some reason, he has a strong opinion against any of these development teams, it's hard to believe that this commission will proceed contrary to his wishes.

Regardless of whether or not that's the case, you can be sure that not all of the losing developers are just going to slink away.  One can expect a plentiful helping of mud to be slung towards those winning teams in whom the others may sense some vulnerabilities with respect to their licensability.

And, of course, once everything is worked out, we shall see just how fast they get built, how many good jobs they really create, how much business they bring to (or suck from) surrounding communities, how their results stack up against their projections, how many local customers declare bankruptcy or lose their homes.

But it will all start on Wednesday.  The Public Notification issued by Gaming Commission would qualify, I believe, as being cryptic:

 MEETING AGENDA

1.            Call to Order

2.            Consideration of Meeting Minutes for December 9, 2014

3.            Consideration of Recommendations of Gaming Facility Applicants for Gaming Commission Licensure

4.        Adjourn

So, let the licensure-ing begin!  You'll be able to watch the proceedings live via the Gaming Commission homepage; I'm sure they'll be a direct link right here somewhere come game time if it's still not there now.  And of course, Twitter will be the place to be for those of us who just have to experience the world in real time.  Unfortunately, I expect to be otherwise occupied, and I'm fine with finding out an hour later (though not much more than that!).  But I'm sure that you can get live updates here, amongst many other places.

I guess I should try to squeeze in some picks, which I will endeavor to do at some point on Tuesday.  But seriously, other than my original suspicions towards those who I consider to be politically favored, I have no idea at this point. And I don't think anyone else really does either. "There are a million rumors running around, but nobody knows anything."  So said Thomas Wilmot, hoping to build the Lago Resort and Casino in Tyre (one of the scenarios which would definitely spur a flurry of legal action). We've heard the rumor about Schenectady having an inside track; this above-linked-to article on Syracuse.com refers to the belief that the Catskills will get two licenses after and despite all the angst over Orange County.  That's what everyone assumed would be the case when this started.

I don't know where any such rumors would be coming from though.  I wonder, as I write this as midnight approaches on Monday, whether the location board itself knows definitively what they're going to announce.

 - In the meantime, VLT's are coming to Long Island, likely before any of these casinos are up and running (with the possible exception of Tioga Downs, where Gural says he can have casino table games up in six months). As you may recall, Governor Cuomo inserted a provision that provided for VLT parlors whether the casino referendum passed or not.  Since it did, we get both, oh goodie!  Both Nassau and Suffolk OTB have plans for 1,000 machine facilities; "slots in a box" as the Times article refers to them.  One thing to be said about that: it at least dispenses the hypocrisy about some of the window dressing that we've seen in the casino proposals.  No idyllic gardens or ponds here; just a bunch of machines catering to mindless gambling......to the tune of some $150 million in net profits a year expected at the Nassau facility.

One thing's for sure: whatever Cuomo's motivation was for supporting these smaller VLT parlors - a bone for Senate Majority Leader Dean Skelos, a hedge against the referendum being defeated, or simply a further effort to bleed more out of the gambling stone - one can be sure that he wasn't thinking about the fortunes of the racing industry.  While Yonkers could lose a very small piece of its action (GM Bob Galterio did note during his FIOS interview that they've managed to maintain a number of customers from Long Island even after Resorts World opened), one would think that the Big A racino would surely stand to lose out the most.  And for NYRA, it's a potential double whammy: Any reduction in Resorts World action would negatively effect payments for purses and infrastructure.....while the new slots parlors will be new competition for Long Island OTB dollars that presently go to racing.  [UPDATE: Reader Dan points out that the NYRA horsemen will get a portion of this slots revenue.  Mr. Hegarty reported last year that it's 2.75% to horsemen and .5% to breeders.)

Saturday, December 06, 2014

Is Schenectady Casino in the Bag?

Hi.  Hope everyone had a great holiday!

As I'm sure you know by now, the next meeting of the location board, scheduled for December 17, is expected to produce the announcement of its recommendations as to who to license for up to four casinos in the state.  And let's emphasize again that these will be exactly that: recommendations to the Gaming Commission, which will ultimately decide whether or not to issue the licenses accordingly.  It's not an insignificant point, considering that the last two big decision processes of this sort that we've covered here over ten years of being Left at the Gate ended with a twist:  Governor Paterson himself selected AEG to get the Big A racino, but it ended up with Genting; and, an Ad Hoc Committee selected Excelsior Racing to get the racing franchise in 2006, but Governor Spitzer ultimately went back to NYRA (a longer and more complex story to be sure).

In a concerted push for the Hard Rock proposal in Rensselaer, just outside of Albany at the Amtrak station, mayor Dan Dwyer and some 30 other elected officials gathered at the site on Wednesday to announce their support.

What impact the announcements will have on the selection process is unknown, said McDonald, of Cohoes, and a fellow Democrat, state Sen. Neil Breslin of Bethlehem.

With time running out, the group deemed it worth making the public effort within sight of the state Capitol. They brought in for support Democratic Assemblywoman Patricia Fahy of Albany and three retired state lawmakers: Republicans Roy J. McDonald, who represented Saratoga in the state Senate, and Bob Reilly of Colonie, who served in the Assembly, and Democrat Jack McEneny, who was an Albany assemblyman. [Albany Times Union
Additionally, Mayor Dwyer announced the completion of the previously-contemplated deal with Albany to pay the city $1.1 million annually from gaming revenue, and commit to job opportunities for residents.  Dwyer had previously insisted on exclusivity, which was thwarted when Albany Mayor Sheehan reached a similar, yet different, agreement with the Capital View project in East Greenbush.
Rensselaer's payments will come for the city's annual $5 million to $5.7 million host community payment, while the payment for East Greenbush would be made by the casino developer. The money from Rensselaer would go to the city's general fund. The East Greenbush developer would pay Capitalize Albany, the city's economic development wing. 
This above-linked-to Times Union piece serves to support those loud whispers we've been hearing that Schenectady has the inside track on this thing, and portrays this as a last ditch effort to persuade the Gaming Commission that Hard Rock is the best option.  Columnist Chris Churchill, writing for the same paper, goes further, writing that the notion that this is in the bag for Schenectady is "widespread amont insiders."
That suggests the deal between Albany and Rensselaer, officially announced Wednesday, could be a Hail Mary by a casino team that's desperate and realizing it's not going to win.

Or maybe, just maybe, the deal is a response to a whispered message from someone in state government that sounded something like this: "Listen, we want to give this to you. But you need to bolster your local support before we can."

As troubling as it would be for the integrity of the gaming commission's process, the second scenario seems as likely as the first. And that would mean Schenectady doesn't have the casino competition wrapped up after all. 
To me, the developers of the proposed Rivers Casino and Resort, on the shores of the Mohawk River in Schenectady, bring precisely the kind of concerns that has the potential, however slight one may believe it to be, to cause the kind of licensing issues that could lead to the type of twist we mentioned above.  Rush Street has received negative publicity over its involvement in the development of casino-type games aimed at kids; and has been the subject of intense criticism by the UNITE Here union over its labor practices. And Och-Ziff Capital Management, who would solely provide the funding, is a subsidiary of a company being investigated by the SEC for investments said to prop up the brutal reign of Zimbabwe president Robert Mugabe.  [Ooops, they are actually the Hard Rock funding arm, sorry for the mixup.]

Churchill also criticizes Och-Ziff Capital for not being willing to make the payments to Albany itself, as Capital View is proposing for East Greenbush, rather than have it taken out of casino revenues that may otherwise flow to the city of Rensselaer.
Och-Ziff isn't even donating to the other newly announced sweetener of the proverbial pot: a pledge of $500,000 to build a dock for the Half Moon, the financially troubled replica ship. That money would come from the city of Rensselaer, along with casino partners Flaum Management and Capital District OTB.