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, February 12, 2010A SILVER LINING FOR BIG A?The man who made the Aqueduct racino dealpossible now is crawling out of the big escapehole he fashioned. New York Assembly SpeakerSheldon Silver, one of the slyest of the fox denin Albany, now is calling for a state investigationof the whole process. Silver took what onenewspaper -- The Buffalo News -- called “the unusualstep” of asking the state inspector generalto look into what went on between Albany andQueens. After setting careful conditions broadenough to cover his tracks, he is retracting hissupport of the Aqueduct Entertainment Group,which quickly met one of his requests -- uppingits upfront money from $200 million to $300 millionafter the bidding was over -- which he hadto know it could, easily, once it had the contract.So now he is saying “serious questions” havearisen, which need to be answered, including therole of the shadowy Rev. Floyd Flake. In challengingthe process he approved, Silver said hewas asking for the inquiry to determine whether“the Division of the Lottery and relevant stateagencies followed all applicable statutory provisions.”To show just how sly this fox is, Silveradded that he wanted to make sure the inquiryincluded how the Lottery Division would “assurethe conditions I conveyed to the Governoron January 29, and restated in my February 3dletter to him.” As Silver climbs out of his selfconstructedbomb shelter, Gov. David Patersonsinks deeper into his dark hole. The whole issueof the racino -- like the whole scene in Washington-- is likely to turn on politics. The Republicanleader in the Senate, Dean Skelos, is callingon the Democrats, who control that body, tohold public hearings. As for the governor, thebest he could do was have a spokesman point outthat Silver had given “full endorsement” of AEGjust two weeks ago. It wasn’t quite full endorsementthen, of course, but that wastwo weeks ago. That’s ancient stuff.HOW BAD CAN THINGS GET?One indication is when a 349-room Ritz-Carltonhotel closes its doors. The Ritz Carlton at LakeLas Vegas, which opened to fanfare seven yearsago, is folding. A spokeswoman said, “Our owners,Village Hospitality, decided they could nolonger fund the hotel. As as a result of that, wecan no longer operate the hotel without adequatefunding.”ANOTHER DANGER SIGNALStorm warnings are flying everywhere, andparticularly in smaller jurisdictions where theymight fail to draw adequate notice.Last week it was in Iowa, where Harrah’s offeredto pay $70 million to buy its way out of having tohave live racing at its dog tracks.Then it was Michigan, where Hazel Park endorsed,and harness horsemen rejected, a plan toback slots at tracks, but at a high tax rate. HazelPark’s spokesman and creator of the legislationthat would add eight more casinos and racinosin Michigan, has drawn negative response fromthe Michigan Harness Horsemen’s Association,which says there is nothing in Adkins’ bill thatwould benefit them. Adkins disputes their assertion,saying his measure would require the stateto take a share of its revenue and put it back intoprograms for horse breeding and racing. Thehorsemen say Adkins’ bill lets the racing percentageup to the state. Adkins called their refusalto support his bill “suicidal,” saying, “Thisis the only vehicle out there. For them to say theydon’t support it is suicidal. Effectively, withoutthis, these tracks are going to close.”In Maine, meanwhile, a legislator has introduceda bill calling for capping purses for three years.Don Marean, a former legislator and USTAdirector, said, “We all thought this was adead issue.” Now it is resurrected.