From Plainview, You Can See Belmont but.....
| CUSIP* | Principal Amount at Issuance ($) | Security Description * | Coupon | Maturity Date | Initial Offering (%) | Current LT Rating | |||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Price/Yield | Price | Yield | Fitch | KBRA | Moody's | S&P | |||||
| 1,455,000 | NASSAU CNTY SUPPORT AGREEMENT | 3.875 | 07/01/2016 | 98.633 | - | - | - | - | |||
| 1,455,000 | NASSAU CNTY SUPPORT AGREEMENT | 4 | 07/01/2017 | 99.059 | - | - | - | - | |||
| 1,450,000 | NASSAU CNTY SUPPORT AGREEMENT | 4 | 07/01/2018 | 98.504 | - | - | - | - | |||
| 1,450,000 | NASSAU CNTY SUPPORT AGREEMENT | 4 | 07/01/2019 | 97.794 | - | - | - | - | |||
| 1,450,000 | NASSAU CNTY SUPPORT AGREEMENT | 4 | 07/01/2020 | 97.03 | - | - | - | - | |||
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By
FRANK AURIEMMA does not exactly fit the image of someone who spends his afternoons hanging around Off-Track Betting establishments.
His complexion is not gray from drink and lack of sunlight - he has a well-fed, grandfatherly appearance. He owns several businesses, and does not lack for cash. He is highly sociable.
What, then, explains the fact that since the grand opening in February of the impressively titled Race Palace - Nassau Off-Track Betting Corporation's new flagship operation - this well-off and well-balanced man has spent the better part of several days a week there?
The explanation, it turns out, is fairly simple: just as Mr. Auriemma isn't a stereotypical OTB customer, the Race Palace isn't a stereotypical OTB branch. Housed in a spacious, pinkish Art Deco-style building that once housed the Vanderbilt catering hall, it was bought and renovated at a cost of more than $13 million to include many of the features of an upscale casino in Las Vegas. The service is studiously friendly, the floors and bathrooms are clean and the atmosphere can almost be described as wholesome. To players like Mr. Auriemma, in other words, the Race Palace represents most everything that traditional OTB branches are not.
''The lifestyle of a horseplayer has been denigrated for years,'' said Mr. Auriemma, a 68-year-old former horse owner who lives in Plainview. ''But this changes the situation. It's the best facility I've ever seen - a horseplayer's Caesar's Palace.''
Mr. Auriemma's reaction is typical of the hyperbole coming from racing fans since the county-run Nassau OTB opened up the Race Palace for business in February on the industrial outskirts of Plainview. Their enthusiasm should come as no great surprise. The place is packed with amenities --the 100-foot bank of projection televisions; the plush seating; the bar and restaurant; the hi-tech Vegas-style personal wagering devices - which racing experts say put the Race Palace in a different category than that of any other facility in the state.
''For a New York OTB this a huge step forward,'' said Steve Crist, the Daily Racing Form's chairman and publisher. ''I've never seen anything like it. Until recently, OTB's were just horrible little storefronts on strip malls with no creature comforts which treated the customer like degenerates. It's just too bad it took over 30 years for them to build a truly first-class facility like this.''
But while the Race Palace has been cause for rapture among horseracing enthusiasts, it will take more than their praise for such an expensive project to be deemed a success. The new venture has been started as Nassau County's profit margins from the race business have begun to decline - a combination of higher state fees, bad weather and competition from better OTB facilities elsewhere held profits in 2003 to $16.5 million, a 13 percent decrease from the year before. Now, the officials who built the Race Palace are counting on it to reverse that downward trend.
''We expect it to have a really big impact on our business,'' said the Nassau OTB spokesman, Joseph Galante.
So far, according to numbers provided by Nassau OTB, the Race Palace is doing better than projected. In its first two months of operation, it has taken in an average of approximately $1.2 million in wagers per week, theoretically putting it on pace to turn a $2 million to $3 million profit by 2005. And the total volume of betting at all of Nassau's OTB facilities is up 10 percent over this time last year, largely on the strength of business at the Race Palace.
A big part of this initial success has come from the 120 or so V.I.P.'s, the discerning and generally well-off customers who previously tended to do their betting at better-equipped facilities outside of Nassau. Since February, they have accounted for a disproportionately high amount of the betting at the Race Palace.
Joe Zarillo of Bethpage is one of those customers fueling the brisk pace of business at the Race Palace. He is a V.I.P.-level player - loosely defined as someone who averages at least $1,000 in bets per day -- who previously did most of his wagering at an upmarket facility operated by Suffolk OTB in Hauppauge. ''It's my heaven,'' he said of his new favorite spot. ''When I die I want to go to the Race Palace.''
Nassau OTB officials hope that such big-spending clients will help business not only by spending their money but also by helping to change its decades-old image as a refuge for hard-bitten, hard-luck gamblers. Hence the Race Palace tagline, repeated like a mantra by the Nassau OTB president, Larry Aaronson, has been ''Not your father's OTB.''
The Race Palace is designed to appeal to the heavy-betting elite. The distinctive building - formerly the Vanderbilt, a catering hall and concert venue whose business had been hurt after a deadly biker brawl there in 2002 -- bears a closer resemblance to a big-time casino than to any other OTB venue.
More important to big bettors than its appearance is the Race Palace's legal designation as an OTB ''teletheater,'' which allows it to simulate the betting atmosphere of an actual racetrack by charging admission instead of taking a cut of winnings. Part of the reason it took the county 30 years to build one is that until last year, a state law intended to protect live attendance at New York's racing venues prohibited opening a teletheater within 40 miles of the Nassau-based Belmont Race Track. Opening Day at Belmont was May 5, meaning that it is too soon to tell whether the Race Palace is actually making a dent.
The payoff for all this is apparent on days like a recent Wednesday afternoon, when the massive main room was all but empty but a designated ''V.I.P. room'' was crowded with high rollers. On that day, about 20 men in polo shirts and track suits slumped in chairs at little desks, each with their own betting device, a combination television, computer and betting terminal. Nearby was a never-ending supply of free sandwiches and drinks, and in anticipation of any need to attend to business unrelated to racing, an Internet terminal and fax machine.
''This place caters to the upscale player,'' Mr. Galante said. ''And I think it's definitely attracting a different clientele than our older branches.''
So far, local civic leaders, who were initially wary of the establishment of a giant OTB facility in their midst, seem satisfied that it is not the den of vice that they first imagined it might be.
''I had reservations when I initially heard about all of this,'' said Francesca Carlow, co-owner of a Plainview hardware store and president of the local Chamber of Commerce. ''I would have to say my impressions of OTB were not favorable. But I haven't heard about anything bad going on there since it opened. I actually think it's kind of a cool place.''
But not everyone is buying into the OTB's attempts at a makeover. Peter Schmitt, the leader of the Republican minority in the Nassau County Legislature, cautioned against alienating the much maligned but loyal customer base that has kept Nassau's OTB operations profitable since their inception in 1974.
''I'm concerned that the Race Palace is a novelty that might wear off,'' said Mr. Schmitt, who lives in Massapequa. ''They built this Taj Mahal over there, and it looks very nice, but in an effort to drive business there they have closed other parlors around the county.''
He was referring to the OTB branch in Jericho, which was closed recently to offset the expense of opening the Race Palace, leaving 14 other OTB sites in the county, excluding the Race Palace.
''I see the guys hanging around the place in Wantagh,'' Mr. Schmitt said. ''They're not looking for some fancy palace. They just want to make a bet and have a cigarette and go home. I don't believe that, a year from now, people from Wantagh or Long Beach or Elmont are going to be going to Plainview to do their off-track betting.''
Mr. Schmitt also questioned the wisdom of tampering with a business model that has always made a profit. ''What they had wasn't broken,'' he said. ''I just hope that their attempts to make it better will not have a negative impact.''
While the Race Palace is still in its early days, there has been another controversy surrounding the Democratic-installed leadership of Nassau OTB: accusations of political cronyism for hiring Patrick Williams, a former Democratic legislator who was convicted of fraud, for a $87,500-a-year job as OTB's human resources director. (Other OTB executives with partisan qualifications include Mr. Aaronson, who is a former chairman of the Nassau Democratic Party, and Mr. Galante, who is the Democratic leader of North Hempstead.)
So far, though, none of the politics around the Race Palace seems to be affecting the stream of bettors that has been pouring money into its coffers for the last three months.
For the Kentucky Derby on May 1, a crowd swelled with occasional players - ''tourists,'' in OTB parlance -- drove that week's handle to $1.6 million.
On another, more typical day soon afterward, the main floor of the Race Palace was largely empty. But seated at one of the small personal betting spaces set up in rows in the center of the room was Mr. Auriemma.
He graciously peeled himself away from his betting machine to answer questions, but the conversation didn't last long before a fellow horseplayer came over to interrupt.
''You were right,'' said the man, who was clearly in an upbeat mood about something. He thanked Mr. Auriemma, kissed the top of his bald head, and wandered off in the direction of the cashier windows.
''I gave him a tip on a horse that went off at 47-to-1,'' Mr. Auriemma explained afterward. ''It's a Finger Lakes horse that ran slow in Florida. It shipped in from Payson Park and was a first-time starter at Belmont. Normally a horse like that would first run up in the Finger Lakes. So I knew something was up.''
Mr. Auriemma beamed as he dispensed racing wisdom to his audience.
''Everything is perfect here,'' he said. ''My wife thinks I got remarried or something. Now if I could only get a little better with my handicapping, it would be a panacea for all times.''
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