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Nassau Regional Off-Track Betting Corp, looking to trim expenses amid declining revenue, will offer another round of early retirement incentives to its 193 employees in an effort to cut its workforce by a fourth and save up to $2.5 million.
The incentive, OTB’s second in two years, comes as the agency works to improve its lagging finances after securing approval for a deal transferring its authority to operate 1,000 video slot machines to Resorts World Casino at Aqueduct.
OTB President Joseph Cairo said the agency needs to reduce its workforce by 50-55 employees, saving between $2 million and $2.5 million annually. If the program misses its target, Cairo said layoffs are possible.
“We need to cut costs to break even or become profitable,” he said. “Layoffs definitely will be considered.”
The incentive, approved by the OTB board Thursday in Mineola, would pay employees 1 percent of their base salary for every year of service with the agency or every year in the New York State Retirement System — whichever figure is higher — with no cap on their total service time.
The incentive is open to all OTB staffers, including its 85 part-time cashiers. OTB has 116 employees over the age of 55 and 53 older than 65. The incentive would be prorated and paid biweekly over six months.
OTB offered a similar incentive in March 2015, expecting 40 employees to take the deal but only a dozen staffers departed. After paying the incentive and any unused sick and vacation time, the retirements saved OTB $192,000 in 2015 and about $800,000 in 2016, Cairo said.
In recent months, OTB cut costs by selling its Farmingdale branch building to a church for $3.2 million and refinancing the Green Acres branch building in Valley Stream. OTB is also considering cutting weekday hours at some of its less trafficked branches.
Last month, the State Gaming Commission approved a deal transferring OTB’s authority to open a Nassau casino to Genting New York LLC, which operates Resorts World.
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The deal stipulates that Genting pay OTB $9 million this year — $3 million was used to pay a debt to a Manhattan investment bank — $9 million in 2017/2018 and $25 million every year thereafter. OTB, which is prohibited by state law from keeping any profits, will give the county $3 million this year, $3 million in 2017/2018 and $20 million every year thereafter.
The plan, Cairo said, should allow OTB to break even in seven years. OTB has a $7.5 million in total debt, officials said.
Suffolk Legis. Kevin McCaffrey (R-Lindenhurst), the president of Teamsters Local 707, which represents Nassau OTB employees, did not respond to a request for comment.
The deadline to accept the incentive is Jan. 6, 2017.
