Posted on 01/23/2012 5:57:23 AM PST by ml/nj
Legislation has been introduced that would pave the way for Suffolk County Regional Off-Track Betting to declare bankruptcy and potentially avoid bailing on its debts, which might include money for the New York Racing Association.
In December, a federal judge ruled Suffolk OTB could not declare bankruptcy without approval from the state Legislature and Gov. Andrew Cuomo. Suffolk OTB had filed for bankruptcy last spring and faced opposition from Churchill Downs, the Kentucky race course that is one of its largest creditors, even though the bankruptcy plan included a framework to pay all debts in full.
Last spring, NYRA President Charles Hayward said Suffolk OTB owed them about $1 million. NYRA gets 2.5 percent of the money bet through the state’s regional OTBs.
As part of the legislation authorizing Suffolk OTB to file for bankruptcy, access to funds in its capital acquisition fund would remain open for “general corporate purposes,” according to the bill’s memorandum.
“This specific authorization to allow Suffolk OTB to file for bankruptcy will protect taxpayers as well as the horse racing industry in New York,” reads the memorandum. “Without bankruptcy protection, in the face of fiscal difficulty, Suffolk OTB could be forced to shut its doors and terminate hundreds of employees. This has devastating consequences for employees, suppliers, landlords, neighborhoods and creditors, and creates complicated and expensive issues for taxpayers. In addition, it causes New York horse racing enthusiasts and racing revenue to shift from New York State-based operations to out-of-state horse racing ventures.”
A state Senate source familiar with NYRA and the regional OTB relationship questioned whether revenue would necessarily shift out of New York if Suffolk OTB collapsed. He said similar to what happened after New York City OTB collapsed at the end of 2010, the state would not miss out on revenue if it adopts a smart online betting program to fill the void.
Last fall, Hayward said that after the New York City OTB closure, NYRA improved its online and telephone betting platforms and ended up increasing revenue from these platforms by $10 million.
Both bills authorizing the bankruptcy protections were introduced Friday in the state Legislature and were referred to each chamber’s respective racing committee, with no meeting dates set.
It just boggles my mind that government can be so inept that they cannot profitably run a bookie operation; and further that anyone can look to government to run anything.
There's more ... IANAL, but when this article starts off with, "Legislation has been introduced ...," I assume that this is something that is being done in the NY State Legislature. But there's this pesky thing in the Constitution that gives Congress the power "To establish an uniform Rule of Naturalization, and uniform Laws on the subject of Bankruptcies throughout the United States." (I know the article says that some Federal Judge ruled that the NY Legislature had to be involved, but I guess that judge just cannot read.) Furthermore, Article I, Section 10 says in part, "No State may pass ... any ex post facto Law, or Law impairing the Obligation of Contracts. If that's not what they're trying do here, then I guess I need a remedial course on the English language.
And isn't it charming that the devastating effects of this bankruptcy will be first for "employees, suppliers, landlords, neighborhoods and creditors." First listed are the bloodsucking government employees. Horseplayers (i.e. customers) come last, if there's any concern for them at all.
Attention must be paid. Government should not be allowed to run anything unless it is absolutely necessary.
ML/NJ
On the visible side most would say they can’t even make a profit on gambling, tells you something about the government. But on the underside they are skimming and showing a loss everytime and now looking for a bail out, tells you even more about the government.
Exactly. The state of New York has a monopoly booking horseracing bets and they lose money every year! People should be reminded of that whenever they think that the government is going to fix things.
You pays your money, you takes your chances. Sorry, they played and lost. I shouldn’t have to bail them out.
Having lived in suffolk for twenty five years, it is a fact that both rats and pubbies are on the same side. Politicians running any type of business will end up bankrupting it. Suffolk county has to change or it will continue.
The people who "played" would not be the ones being bailed out at all. The first ones to be bailed out will be the "public servants" who had cushy no-show jobs. Count on it. Maybe some of the creditors will get to fight over some of the leftover crumbs.
ML/NJ
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