Saturday, July 7, 2007

Forbes.com: NYRA Chief 'Optimistic' on Franchise by Chris Carola...

The head of the New York Racing Association said Monday he's optimistic his organization will retain the state franchise to continue operating the Saratoga, Aqueduct and Belmont racetracks.

During a pre-Saratoga news conference, NYRA president Charlie Hayward joked that the organization didn't spend a lot of time thinking about the possibility this could be the last summer NYRA operates the upstate track.

In reality, Hayward acknowledged the clock is ticking and said his organization would prefer a decision sooner rather than later on whether NYRA will retain a franchise it has held since 1955. The current franchise expires Dec. 31, along with many of the contracts NYRA has with employees, vendors and service companies, Hayward said.

"I think there are some very real issues, for the goodness of the game and for the best interest of all people in this room, that we get this situation resolved," he said.

NYRA faces three competitors for the franchise: Empire Racing, Excelsior Racing Associates and Capital Play. A decision on the winning bid could be made by Gov. Eliot Spitzer and the state Legislature as early as this summer.

Earlier this month, the competitors were told that Spitzer was interested in having a separate racing entity operate the three tracks while allowing another operator to run the video slot machines slated for Aqueduct, and possibly Belmont.

Hayward said NYRA would support that scenario if the racing operation received its fair share of the gaming revenues for its purses.

The VLT plans for Aqueduct were thrown off kilter in May, when casino operator MGM Mirage Inc. (nyse: MGM - news - people ) withdrew its proposal to develop and manage the gaming facility at the racetrack. MGM's role was assumed by all four competitors in their proposals made in April.

NYRA's growing debt - some estimates have it as high as $300 million - and questions over who owns the three tracks complicate the situation. NYRA contends it owns the tracks, a claim strongly disputed by the state.

"We're just trying to stay as focused as we can to make sure we run a good Saratoga," Hayward said when asked about the impact all the uncertainty is having on NYRA's operations. "I'm optimistic in the direction we're headed."