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, EditorThursday, April 15, 2010NY OTB AID PLAN COLLAPSESDon’t bet that it won’t be revived next Monday,when the well-rested New York legislators returnfrom their long weekend recess, but as of rightnow help for desperate New York City OTB isgone, with the old story of disparate intereststrying to get a legislature to deal with all theirrequests and demands. Assistance fell apart yesterdaywhen labor unions objected to severancepayment arrangements, tracks objected to a 15%cut in OTB proceeds, and the boys in Albany simplythrew up their hands and went home. NYCOTB, which was scheduled to shut down last Sunday,now is due to shut down this coming Sunday,but could delay that a day in the hope thatsome compromises might have been arranged inthe down time in Albany between now and then.Some legislators balked at the retirement benefitspromised by NYC OTB, which they said aren’trealistic given the company’s financial problems;others with tracks in their districts said no to the15% cuts; and the governor said he was “deeplysaddened” that the legislature’s reluctance to accepthis plan for OTB would lead to unemploymentfor NYC OTB’s 1,300 employees. In anexcellent summary of what the bailout plan actuallyconsisted of, Rick Karlin of the Albany TimesUnion provided an outline of the major points.They include:A 15% cut to tracks for a year, worth $1 million,and 75% cut to New York City and the five boroughsfor a year, provided a positive cash flow isshown by NYC OTB within 60 days or that provisionwill be lost;Allowing NYC OTB, instead of the state, to keepunclaimed ticket money for a year;Allowing 1 year of Internet streaming of races forany OTB;No requirement to pay the tens of millions owedto tracks and others by NYC OTB;An $18 million loan to pay for early retirementincentives;Allowing joint ventures for OTBs, tracks;Eliminating the memorandum of understandingbetween unions and NYC OTB.DELEO SLOTS BILL SAILS THRUThe power and popularity of Robert DeLeo,Speaker of the Massachusetts House, and thestate’s urgent need for money, was made evenmore apparent yesterday, when his proposal forslots at state tracks along with approval of twocasinos breezed thru by a veto-proof vote of 120-to-37. An ecstatic DeLeo told a packed Housechamber, “We all did ourselves very proud. Ithink what we can say is that we are the envy ofevery other state in the country.” DeLeo’s pointman on the legislation, Rep. Brian Dempsey, saidthe bill will create more than 15,000 jobs andbring the state $100 million a year, and said thepositive impact of the bill will clearly outweighthe negatives raised by opponents. The measurenow goes to the Senate, where it faces a toughervote, particularly on the slots portion of the bill.NH BILL WILL BAN DOG RACINGThe New Hampshire Senate has voted to banlive dog racing in the state, following the actionof the legislature in neighboring Massachusetts.Proponents noted that the two remaining dogtracks in New Hampshire, Seabrook and Belmont,no longer offer live racing, surviving onsimulcasting, and banning the sport will save thestate regulatory expenses. Opponents arguedthat the tracks, not the state, should decide onthe prudence of racing. HB360 now moves backto the New Hampshire House.$65 MILLION HIT AT MIGHTY MA New York Supreme Court judge has ruled thatMonticello Raceway must pay its bondholders$65 million. The track had gone to court hopingto escape meeting the calls, triggered whenPlainfield Asset Management, a lead investor,called in $22.5 million of the notes of the track’sowners, Empire Resorts. Former Empire CEOJoseph Bernstein says the track “should be fine”with the backing of 50% owner Kien Huat,a Malaysian casino giant.