Gov’s ‘bettor’ way
Plan to kill NYRA and privatize horse racing
- Last Updated: 12:33 AM, September 24, 2012
- Posted: 12:31 AM, September 24, 2012
Fredric U. Dicker
Cuomo, who will sign legislation within days giving the state control of NYRA’s board of directors, plans to seek public bids for a new operator to replace NYRA, a not-for-profit corporation, from for-profit companies with deep experience in the racing and/or entertainment industries, sources said.
G.N.Miller/New York Post
Andrew M. Cuomo
A source with firsthand knowledge said it will take several months to draw up the specifics, and bids will likely be solicited by the middle of next year.
“Why not let Churchill Downs compete with Santa Anita, with Formula One, with Madison Square Garden for the best operation of the tracks?’’ asked the source.
Aides to Cuomo including Howard Glaser, the director of state operations, had worked for months on a sweeping NYRA reorganization plan in preparation of the governor’s signing of new legislation giving the state direct control of the 55-year-old racing association’s operations.
But in mid-summer, as the Saratoga meet got under way, the Cuomo aides decided that NYRA’s organizational structure and management team, which has had a series of scandals in recent years, wasn’t up to the job and that a new approach — proven outside management — was needed.
“The NYRA model won’t work. It’s flawed, and it’s unable to do the job. Privatizing makes the most sense,’’ said the source.
The Post reported in July that current NYRA President/CEO Ellen McClain would be fired after the governor signed the legislation taking control of the racing association. A source said McClain’s dismissal would likely occur early next month.
The legislation to be signed by Cuomo creates a new 17-member board of directors for NYRA, eight to be picked by Cuomo and four by the leaders of the Legislature. The current NYRA board will have only five appointees.
Meanwhile, as part of a build-up to the coming changes at NYRA, Cuomo will announce on Friday a new oversight and regulatory process for ensuring the health and safety of horses at the three tracks, it was learned.
The changes will include the creation of an oversight body, separate from the moneymaking side of the racing business, to address a growing number of horse deaths and injuries at the three tracks.
Experts link the problem to increasingly lucrative racing purses generated by the huge profits coming to NYRA from the year-old racino at Aqueduct.
“Nobody really had the best interests of the horses in mind,’’ said the source.
The Post has also learned that the state Inspector General has concluded that “negligent oversight’’ by NYRA’s top management and its board of directors was responsible for the massive “takeout” scandal that cost bettors nearly $8.5 million over a 15-month period ending late last year.
Acting Inspector General Catherine Leahy Scott, nearing the end of a five month investigation, concluded that former NYRA CEO Charles Hayward and General Counsel Patrick Kehoe, along with “virtually everyone else in a position of responsibility,’’ knew of a legal requirement to lower the amount the association took from bets being placed at the three tracks but failed to act, said a source with knowledge of the report.
Hayward and Kehoe were fired by NYRA in May after the state Racing and Wagering Board disclosed the takeout scandal. However, the Inspector General’s report will say the state board didn’t act quickly enough.
Cuomo followed up the report by ordering an investigation by the Inspector General, partly to determine if NYRA officials had engaged in criminal conduct or might be liable in a civil court action.
The IG report concluded that no criminal conduct occurred and that a successful Civil Court action was unlikely, the source said.
fredric.dicker@nypost.com
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