HARNESS TRACKS OF AMERICA Executive Newsletter

HARNESS TRACKS OF AMERICAExecutive NewsletterA daily fax and e-mail report on racing and gaming developments in North America and beyondStanley F. Bergstein, EditorFriday, October 8, 2010WHERE TO FROM HERE?New York City OTB’s new president andCEO Greg Rayburn has taken his first bigstep in reorganization of the company. Henegotiated a deal with its biggest union toprovide $12,000 severance payments tosome 550 of OTB’s 1,300 workers in returnfor them leaving employment withthe company. Part of the package includestransferring NYC OTB’s account wageringoperations to creditor racetracks inthe state, principally Yonkers Racewayand the New York Racing Association.Also part of the plan is for thoroughbredand harness tracks to take a $30 millioncut in annual payments. With the unionapproving by a 271 to 139 vote, the plannow must be approved by the creditors’committee, where it faces harness racingopposition, and the bankruptcy court, aswell as legislative approval for changes instate law on some of the complex provisions.TALK ABOUT SECRET MOVESWhen the CEO of a racetrack has to readabout sale of his track in the local newspaper,one wonders about talk of transparencyin government. That was the situationin Del Mar, where CEO Joe Harperand presumably others read about thereported sale of the seashore track tothe city of Del Mar for a reported bargainbasement price of $120 million. Theproposed sale, which drew immediatecriticism, includes 350 acres ofprime property.The San Diego Union, which broke thestory, said top secret negotiations hadbeen ongoing for months, but surfacedWednesday when a bill was introduced inSacramento and then pulled when it facedfailure to gain the two-thirds majority voteneeded to pass. One member of the SanDiego area legislative group, assemblymanMartin Garrick, said, “Del Mar is atreasure located in an irreplaceable location.This bill was rushed through at thelast moment, without going through thecompetitive bidding process and not seeingdaylight like it needed to.” The mayorof Del Mar, Richard Earnest, said the citycouncil backed the idea unanimously, andwould “like to make it a first-class facilityfor horses and agriculture.” That statementalso must have surprised Joe Harper,along with others who have built DelMar into the Saratoga of the west. Continuingthe deep dark secrecy, the statedid an appraisal but did not share it withthe city. The president of the fair boardthat controls Del Mar said he had heardfigures as high as $800 million to a billionas the value of the property instead of the$120 million now offered. The mayor acknowledgedmuch debate ahead, saying,“Stay tuned. We got a lot to talk about inthe coming weeks.”PENN NATIONAL IN VEGASThe empire rolls west. Penn NationalGaming, which spurned a position in LasVegas earlier this year, is acquiringcontrol of the M Resort there.