Chris Kay

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Chris Kay is not what ails NYRA

Posted by noonante on March 19, 2019
Posted in: Horse Racing, Political/Social commentary, Politics. Tagged: , , , , . 1 Comment

The New York Racing Association announced the sudden resignation of its President and CEO, Chris Kay, on January 23.  Six weeks later, one of the government agencies responsible for monitoring NYRA had a brief discussion of the matter.  It left more questions unanswered than addressed.

Neither NYRA nor either of two government bodies charged with oversight, the Franchise Oversight Board and the State Gaming Commission, have stated why Kay’s unanticipated resignation was compelled.  David Grening of the Daily Racing Form reported that “according to multiple sources,” NYRA’s Board “asked for Kay’s resignation after it learned that Kay had used NYRA employees to do private work for him at the house he owns in Saratoga, considered a breach of company policy.”

I have never seen any denial or refutation of Grening’s reporting.  At the March 7 meeting of the Oversight Board there was implicit confirmation of this being a reason for Kay’s termination.  A NYRA executive also stated there were two additional disciplinary actions, including one of an unidentified Senior Vice President.

The approach of the Oversight Board appeared to have less to do with any meaningful oversight, but rather to get this matter behind them as quickly as possible with the hope that people would simply forget about it.  When NYRA’s General Counsel was asked what caused this, he could not answer because he did not know the motivation of Kay “and others.”  He added there was a “culture” at NYRA “where people were reluctant to report bad things.”

Kay’s motivation was obvious and, frankly, not all that important.  He was getting stuff for free.  And if there was such a culture at NYRA, it does not distinguish it from any other work place. It is also not a reason why the CEO would act with seeming impunity.

The real culture that caused this is the one that enabled Kay.  There were theoretical checks on his conduct:  he reported to a Board of Directors, and was answerable to two government oversight agencies, the Oversight Board and the Gaming Commission.  But the sad history of these supposedly independent bodies is that only one individual in the six years of Kay’s tenure ever stood up to him.  And that person resigned in the early part of 2017.

The NYRA Board of Directors became subject to the public records law and open meeting law once Andrew Cuomo seized control of it in 2012 and turned it over to government control  –  mostly, his own.  I observed every public meeting of the Board until it was supposedly returned to private control in 2017.  With two exceptions, the meetings of the Board were a joke.  For the most part, they consisted of Chris Kay slide shows in which he discussed either matters already reported in the media, or a summary of his accomplishments.  The Board, at that time, had audit and internal control functions.

It was clear from the public meetings that the Board was either doing nothing or conducting its real business behind closed doors.  There are, of course, legitimate (and limited) reasons for meeting in private, but much of what was being done  –  if anything was being done  –  did not fall into that category.  When I complained to New York’s Committee on Open Government, they agreed and ordered the Board to comply with the law.  They ignored that directive.

The Gaming Commission is another government agency charged with, among other things, oversight of NYRA.  It also adjudicates disciplinary matters and issues regulations.  It makes NYRA’s former public meetings look like the Lincoln-Douglas debates.  There is rarely a discussion of any substance, nor do they feel any obligation to explain publicly their reasons for anything.

The Franchise Oversight Board has been the one body that cannot be dismissed summarily as a check on either NYRA or its CEO.  (Although it is not a high bar to clear when the meetings of the other two can be described as a joke.)  There was one member in particular, Steven Newman, an accountant experienced in the operations of government agencies, who took oversight seriously.

Newman questioned the claims of NYRA and Kay that they had started operating as a profitable entity.  He thought that reconfiguring the financial books to move certain expenses off the operating ledger was not an indicator of profitability.  He questioned why NYRA would not allow its independent auditor to appear at a meeting of the Oversight Board.  He questioned why Kay’s performance standards and annual evaluations were not available to the Board.  He raised significant, meaningful questions to which Kay often responded angrily or defensively.  Newman resigned in the first half of 2017.

Other Oversight Board members were less rigorous.  One incident that stands out was the time Kay was being questioned about his request for increased funding for the Saratoga “Walk of Fame,” a vanity project for which only he saw the need.  The Board Member assured Kay he did not have to discuss it if he did not want to.  This same Board Member once offered to assist Kay in his desire to be “unshackled” from the NYRA Board  –  as if they were an impediment to Kay getting his way on everything.

At its March 7 meeting, Board members expressed their concern that “something as dumb as” the Kay scandal would affect what they believed to be the progress they made since Cuomo took control of NYRA in 2012.  You know what is said of karma, and hubris only makes it worse.

The 2012 Cuomo coup was facilitated by compliant state actors and a flaccid NYRA Board.  They trumped up charges of malfeasance by the then-CEO and the General Counsel, firing both of them.  They challenged the integrity of Board members, threatening to rescind the licenses they needed to race their horses.  A review by the Governor’s own Inspector General, however, concluded that the NYRA CEO did nothing wrong, and that a mistake that resulted in a short-changing of bettors was actually the result of poor legal advice.

The media went along with the Cuomo narrative, talking about the need to restore integrity to NYRA.  They ignored the juggling of financial books to turn a deficit into a profit.  They further reported the falsified Saratoga attendance figures fed to them by NYRA.  Regrettably, the demands of deadlines prevent most reporters from delving too deeply into NYRA’s press releases.

That is not an impediment, however, for government agencies charged with oversight.  The Franchise Oversight Board, in particular, only has such responsibility for NYRA.  But the issues that were supposedly at the fore in 2012 were no longer in play when now it was Cuomo’s appointees in charge.

One Board member back then  –  who is still on the Board  –  questioned why settlements were paid to the terminated CEO and General Counsel.  (The answer is that the payments were required by contracts.)  This time around, the CEO was a Cuomo pick, and there was no such question.  That is in spite of the fact that in 2012 there was no allegation of personal impropriety and this year there clearly is.

This represents just another example of that “culture” in which NYRA operates.  The “culture” is not that a groundskeeper is “reluctant to report bad things.”  The culture is one where established professionals and business people are so beholden to a Governor that they will not stand up for what is right.

At the March 7 Oversight Board meeting, NYRA officials said they were revising an ethics policy and doing more training.  Right.  The problem is not that a CEO with several senior positions in major organizations did not know that using a company’s employees to cut his grass would be an issue.  The problem is not that a carpenter needs ethics training or whistleblower protection.  The problem  –  as it so frequently is  –  is that the entitled feel entitled.  And that members of the Oversight Board and Gaming Commission are entitled persons who think other entitled persons should get a free pass.

But for those on the Oversight Board and NYRA management who think a satisfactory response is providing a mutuel clerk with more training and whistleblower protection, here are some basic questions that must be addressed and answered publicly:

  • What were all of the reasons leading to the termination of Kay’s employment?
  • Did NYRA conduct a review of the allegations and, if so, what did it conclude?
  • Did NYRA’s Internal Control function, assuming it still has one, conduct a review and, if so, what were its conclusions?
  • Did either the Franchise Oversight Board or the State Gaming Commission conduct an independent review and, if so, what were their conclusions?
  • Has the Governor’s Inspector General, who conducted a review in 2012, done so this time and, if so, what were her conclusions?
  • Has there been a review, by any entity, of financial transactions authorized by Kay, including his expense accounts?
  • Is NYRA going to seek damages from Kay, as one Franchise Oversight Board member suggested in 2012?
  • Has a review been conducted of whether shortcomings within NYRA leading to these issues implicates their retention of the franchise, as was done in 2012?

These are all basic questions that would be asked by any organization when confronted with the unethical conduct of its CEO.  My fear is that there is a considerable desire to sweep all of this under the rug, and move on to planning for the Belmont Stakes.

A comparison between the terminations of NYRA’s CEO in 2012 and 2019 is instructive.  As I wrote about regularly in 2012, the Cuomo takeover of NYRA was purely a political power play using a manufactured scandal and intimidation, including threats against NYRA Board members. The threats were conveyed in a letter by Cuomo’s Budget Director, who served as Chair of the Franchise Oversight Board, and the head of the Racing and Wagering Board (now the Gaming Commission), who prepared a report alleging malfeasance without interviewing anyone or reviewing all relevant documents.

There was never an allegation of personal impropriety by the CEO.  The Governor’s own Inspector General conducted a review in which she actually interviewed numerous individuals and examined documents.  She issued a lengthy report that dispelled none of my statements in this or the preceding paragraph.

By contrast, the 2019 termination of Chris Kay was for personal impropriety according to a published report that has not been disputed.  In contrast to 2012 when the Cuomo staff were actively publicizing their “investigations” and opinions, there has been none of that this time.  The difference?  I’ll take a wild guess and suggest that it is purely political.

Political motivations are, of course, a similarity between the two years.  Another similarity is the avoidance of those in positions of responsibility to accept accountability.  Ironically it is only the 2012 CEO who acknowledged an error  –  and took immediate steps to rectify it even before it became a political football.

But no one else, in either instance, who served in a position with oversight responsibility has stepped forward to acknowledge responsibility  –  whether it be a NYRA Board member or a member of the Franchise Oversight Board or the Gaming Commission.

And that is the “culture” desperately in need of change.

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Gaming Commission meeting consistent with past performances

Posted by noonante on January 29, 2019
Posted in: Horse Racing, Political/Social commentary, Politics. Tagged: , , , , . Leave a comment

The Monday meeting of the New York State Gaming Commission did not disappoint if you wondered whether they would adhere to their past performances.

There were two items of interest to thoroughbred racing participants and fans that could be discussed.  One was a proposed regulation that sought to weaken the existing rule that was adopted following an increase in racing fatalities at Aqueduct in late 2011 to early 2012.  The other was the Commission’s response to the sudden and unexpected resignation of Chris Kay as President and CEO of the New York Racing Association.

As usual, the Commission tried to start the meeting about 40 minutes after the scheduled start, but then spent an additional 10 minutes working out audio and video transmission issues.

The regulation under consideration concerned the “purse-to-price ratio” in claiming races that I wrote about here and here.  I also submitted the only public comment on the proposal.  Because the Gaming Commission had already approved the rule for adoption prior to the expiration of the legally-required public comment, and prior to submission of my comment, they had to “consider” my comment at the Monday meeting.

If you are interested in the Commission’s “discussion” of my comment, you can replay it on the Commission’s website.  Don’t worry, it will not take long.  It begins at the 1:20 mark of the meeting and ends about four minutes later.  The “discussion” is a reading of a prepared statement by the Commission’s chairperson that is simply incoherent.

It addresses none of the issues I raised, including that it was based on a secret memo by Dr. Scott Palmer that the Commission will not release, as well as unidentified supporters of the rule change, and their reason for changing it.  Nor was there any recognition of the fact that the regulatory change is contrary to the report of a Task Force Report on the Aqueduct fatalities, as well as Governor Cuomo’s order in 2012 to implement a stricter version of the regulation.

At least that part of the agenda lasted for more than four minutes.  There was no mention of the fact that the head of NYRA was apparently suddenly forced out of his position by NYRA’s Board of Directors.  I say “apparently” because there has been no official explanation for the “resignation” of Kay that the Board accepted “effective immediately.”

David Grening of The Daily Racing Form has reported that the resignation was made because Kay had been using NYRA employees to do work at his private residence in Saratoga Springs.  I have seen nothing that disputes Grening’s report.

But the Gaming Commission is one of two government agencies in New York that has legal oversight responsibility for the actions of NYRA.  They are seemingly content to blithely ignore what is corruption in New York’s premier thoroughbred operation.

Even if Grening’s report is accurate, and cites the real  –  and only  – reason for the termination of Kay’s employment, there are more questions that need to be addressed.  For starters, how does an entity such as NYRA that has a history of prior internal control issues allow such behavior to occur?  Were any other management officials complicit in this?  The employees had to report to someone who approved their time slips.

Unfortunately, the Gaming Commission has a history in which transparency and accountability are rarely present, as exemplified by these two matters,

Bad day for NYRA

Posted by noonante on January 27, 2019
Posted in: Horse Racing, Political/Social commentary, Politics. Tagged: , , , , , . 1 Comment

This past Wednesday was not the best of days for the New York Racing Association.

Gabby Gaudet, a NYRA television commentator for a couple of years, decided to take her talents to TVG.  She is an engaging and personable expert  –  adjectives rarely used to describe her remaining counterpart, Andy Serling.  For a sport in desperate need of expanding its fan base to bring in a younger demographic (and more women), Gaudet is a real asset.  Her departure will not help NYRA’s efforts to popularize its own broadcast efforts.

Then there was the sudden “resignation” of Chris Kay, President and CEO of the organization.  When NYRA”s Board of Directors accepted the resignation “effective immediately,” we can assume that it was either resign or be fired.  NYRA’s press release did not offer a reason for the unexpected action.

David Grening of the Daily Racing Form reported, however, that according to “multiple sources … the board asked for Kay’s resignation after it learned that Kay had used NYRA employees to do private work for him at the house he owns in Saratoga.”

By the standards of the Cuomo Administration, of course, this is a small-bore scandal, although certainly one worthy of being terminated from employment.  And let’s not kid ourselves about NYRA now being in private control.  The Board’s membership did not change when it was supposedly “reprivatized” from government control.  The majority of the Board consisted of either Cuomo appointees, including Kay himself, or Cuomo loyalists.

It is no longer surprising when entitled people engage in remarkably stupid behavior and exhibit serious errors in judgment.  Kay, according to the most recent public information, was pulling in more than $500,000 annually and could be expected to pay someone to mow his lawn.

What is surprising, however, is that earlier this month The BloodHorse reported that Kay and his wife made a “personal donation of $100,000” towards the New York Race Track Chaplaincy of America’s efforts to build a multi-purpose building at Belmont Park to serve track workers.  That’s a serious chunk of change, and seemingly not the conduct of someone engaging in nickel-and-dime corruption.

Kay has been a controversial figure.  (I suspect, however, that that would be true of any person serving in the job given the opinionated, sometimes dyspeptic, nature of racing fans.)  He acknowledged knowing nothing about the sport when he arrived in 2013  –  he once characterized the condition book that lists upcoming races as if he discovered the Holy Grail even though all tracks have a version.   But he developed a fluency and knowledge as he went on.

Under his leadership, improvements have been made, although some may have been initiated before he arrived.  There are the changes to the living conditions of backstretch workers  –  Board member Michael Dubb was a major champion.  He developed a new arrangement at Saratoga at the top of the stretch that changed frequently empty seating sections to something that could attract new fans and revenue.  Saratoga is also building a new structure at the other end of the grandstand that will cater to those who had been going to the temporary modular units.

Some of his “improvements” have come at the expense of the “regular Joe and Jane” race trackers who, for example, may like to go to the paddock without being crowded out by picnic tables for sale or tents serving as pop-up bars.   Then there is the monument to his ego  – a new building outside the grandstand that serves as a museum to those awarded a “Red Jacket,” a lame idea that he thinks will become his contribution to Saratoga tradition.

On balance, was he a positive force?  His selling point was that he excelled at customer service  –  or, as he called us, guests.  But he touted the Belmont Park festival, portrayed as a three-day extravaganza of great horse racing.  The best races were all moved to Saturday, with lesser stakes running the preceding days.  My memory of going on the Friday two years ago is of a “crowd” that could easily fit in my high school’s gym, and not being able to get a hot dog  – the day before the Belmont Stakes.

Is Saratoga a better experience?  I like to treat company to what I call the “full Saratoga.”  It’s the training tracks in the morning with breakfast there.  Races in the afternoon and, of course, downtown in the evening.  While the grandstand improvements are a welcome change, one cannot escape the notion that it is primarily those with large amounts of disposable income that are the real “guests.”

Whatever his shortcomings may be, however, Kay is not what ails New York racing or prevents it from improving.  NYRA does have two governmental oversight bodies  –  the Gaming Commission and the Franchise Oversight Board.  Both are dominated by appointees of Andrew Cuomo  –  just as NYRA is.

When Governor Cuomo seized control of NYRA early in his administration, he did it by trumping up charges against NYRA’s leadership and ordering reviews of alleged malfeasance at the organization.  While the results of those reviews were clearly politically motivated and phony, Cuomo got what he wanted  –  control of NYRA and removal of those who preferred to act independently and not kowtow to his whims.

Now we can see how determined the Governor is to ensure integrity at one of the nation’s premier racing jurisdictions.  If David Grening’s sources are correct, there is clearly a significant problem within NYRA.  Back in the day when NYRA conducted public meetings, there were reports from Board members with internal audit and financial control responsibilities.  Those reports were public.  As part of his effort to seize control in 2012, Cuomo has the Gaming Commission’s predecessor, the Racing and Wagering Board, issue a public report.  The Governor’s Inspector General also issued a public report.

That, however, was back before the Governor was responsible for NYRA.  While he may still try to disclaim responsibility under the “reprivatization” charade, he is responsible for the Gaming Commission and Franchise Oversight Board.

The Gaming Commission has a public meeting Monday at 1:00 at which the NYRA situation may be discussed.  They will also be discussing a weakening of an equine safety rule that I discussed here and here.  It will be broadcast on their web site, but don’t hold your breath waiting for any serious discussion.

 

 

 

Cuomo keeps control of racing in new law

Posted by noonante on April 11, 2017
Posted in: Horse Racing, Political/Social commentary, Politics. Tagged: , , , . 3 Comments

The New York legislature has approved a new law to replace the temporary “reorganization” law from 2012, but it guarantees that Andrew Cuomo retains control of racing at Saratoga, Belmont and Aqueduct.  While the legislative leaders and various media sources proclaim this is a glorious return to private control of the New York Racing Association, the reality is far different.

Under the budget law for the new fiscal year, signed by Cuomo, the governing board of NYRA has been dramatically restructured.  The Board will remain at 17 members, but allow two entities that represent horsemen and horsewomen, the New York Thoroughbred Horsemen’s Association and the New York Thoroughbred Breeders, to each have a vote.  The Senate gets two appointments as does the Assembly.

The remaining 11 seats are controlled by the Governor.  The NYRA CEO and President  –  currently Chris Kay, who is effectively a Cuomo appointee  –  will be on the Board.  The Governor makes two direct appointments.  The remaining eight seats, however, will be appointed by a current NYRA Board committee that is dominated by Cuomo loyalists.  Cuomo also appoints the Board Chairperson from the members of the new board.

It is that NYRA committee that permits the fiction that NYRA will be under private control.  Of the six committee members, three are appointees of Cuomo, one of the Senate, and one from the former NYRA Board.  The sixth member of the group, and the chairman, is Michael DelGiudice.  Although he was appointed by the Assembly, if there is any doubt about his allegiance to Cuomo, he has said “Andrew is like a younger brother to me.”

Now it is true that all six of the committee members are private citizens, although five of the six are appointed by the state government.  Indeed, of the fifteen members on the Reorganization Board, there was only one government employee.  Nonetheless, the agency committed to overseeing New York’s public records law and open meetings law, the Committee on Open Government, concluded that the appointment of a majority of that Board by government officials was an important factor in deciding that it was a public entity.

Perhaps you think that appointees of Governor Cuomo are capable of exercising independent judgment and will select Board members who are independent and competent.  You must also be eagerly awaiting the arrival of the Easter Bunny this weekend.

The only truly private members of the new Board are from the organizations representing the breeders, owners and trainers  –  the people responsible for ensuring that New York has horses that enable it to have horse racing.

So we have gone from a “government-controlled” Board in which 12 of the 17 members were appointees of the government to one in which 15 of the 17 are either appointed directly by the government or are controlled by the government.  This is privatization?

The Reorganization Board that is being replaced had five truly private members from the predecessor NYRA Board.  In all candor, those five did nothing over the last five years to provide a check on the Governor.  They were, after all, part of a toothless board that rolled over and allowed Cuomo to seize control of racing back in 2012 following a brief campaign of threats, intimidation and baseless allegations of inappropriate behavior.  They will not be missed.

New York had a unique opportunity to come up with a different approach.  While it already has the best racing in the country, it could also have innovative and thoughtful leadership that would grow the fan base and lead to sustainable growth.  Instead, we have the small-bore leadership of a Chris Kay and now a structure that will remain a patronage haven for hacks and campaign contributors that will not move the sport forward.

It is a shame.

 

 

 

Does Chris Kay know anything about basics of his business?

Posted by noonante on January 12, 2017
Posted in: Horse Racing. Tagged: , , , . 3 Comments

Chris Kay has been the CEO and President of the New York Racing Association for close to four years now.  When he was hired, he had no background in racing, although he said he had once gone to a track.  Whether you agree with him or not, he has gotten up-to-speed on numerous aspects of the business, for which I give him credit.

But on Tuesday, he said something indicating that he knows nothing about the fundamentals of that business  –  which is, of course, horse racing.  He described an innovation brought about during his administration  –  what he referred to as a “book.”  Now I realize, like his boss the Governor, he will take credit for almost anything favorable short of the sun rising in the East.  What he was describing, however, is the condition book.  It’s been in existence for the 20 or so years that I have had interests in horses.

For those who do not know, a condition book is a schedule of the races that a track hopes to run over a period of several weeks.  For each day of that period, it will identify the level of a particular race (maiden, allowance, stake, etc.), and the eligibility requirements (age, gender, etc.)  It allows trainers and owners to pick out races for which one of their horses may be eligible.  It’s an important part of the planning that goes into the preparation of a given horse.

Now, it is unreasonable to expect that anyone, even the head of one of the nation’s major racing jurisdictions, will know every detail about the business.  (Incidentally, no one on the Franchise Oversight Board to whom Kay was speaking seemed to know of this, either.)  But Kay was using his innovative “book” as a reason for why he is able to attract more owners to the sport.  According to Kay, owners from “Virginia or North Carolina” will now know that a race is going to go on a particular day, so they will plan a trip to Aqueduct [sic] to watch their charge.

Of course, if an owner thinks that is a guarantee, it may be more useful to provide some educational information as to why that may not happen:  there may be insufficient entries to run the race;  there may be too many and your horse is on the also-eligible list;  the race may come off the turf and you only want to run on the grass.

The more fundamental problem, however, is that Kay has less understanding of the actual mechanics of racing than most owners, trainers, and barn staff. When I was fortunate enough to get a horse to the track last year, one of the most frequent questions I was asked by non-fans was “how do you pick out a race?”  The answer, of course, was “the condition book.”

If Kay now has some investment in his “book,” perhaps he can now work at getting it out on a more timely manner than the last minute.  It’s a source of frustration for trainers (and, presumably the owners he is concerned about) that proper preparation for a horse is even more important than being able to get a room reservation.

Some thoughts on the Spa meet

Posted by noonante on September 2, 2016
Posted in: Horse Racing, Political/Social commentary, Politics, Saratoga thoughts, Uncategorized. Tagged: , , , , . 1 Comment

The meet is inexorably winding down, but the last week restores a measure of peacefulness as outfits start to move out and traffic behavior returns to a more sane level (i.e., fewer NYC or Boston drivers).  Some observations:

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The “Big Day” concept took a hit on Travers day.  The notion of packing a bunch of Grade I stakes on a single day was designed to ensure a high handle even if a marquee star  –  a potential Triple Crown winner or actual winner  –  isn’t going to appear.  Last year, of course, American Pharoah won the Belmont and ran in the Travers.  With no superstar in this year’s Travers, attendance did not hit NYRA’s self-imposed cap of 50,000 and handle was down 9 per cent from 2015.

What NYRA loses when it loads Grade I’s onto a single card is the ability to promote other stars of the sport and grow fan interest.  When it’s the Travers, a Flintshire or a Lady Eli isn’t going to fit NYRA’s promotional agenda.  But you have a turf star and an undefeated filly who survived a life-threatening illness to come back after a break of over a year.  Each could have been the object of a marketing campaign that might have produced buzz on a day other than the Travers.

Speaking of buzz, the Travers had none.  Now when you have a Triple Crown winner drawing 15,000-plus for a gallop the day before the Travers, one cannot expect a repeat the following year.  This year, however, there was no danger of a sell-out.  Even hotels were available Travers week.  NYRA’s imposition of a cap may have deterred many who would have come had they not worried about being shut out.  (For last year’s Belmont Stakes, NYRA announced it would not sell tickets at the gate even if their self-imposed cap of 90,000 had not been reached.)

The Travers is an event that will draw a substantial crowd whether there are six other graded stakes on the card or none.  The handle from a stakes-heavy card, however, is going to be substantial when off-track bettors are added in.  NYRA is missing an opportunity to draw interest when the Grade I events are put on a single day instead of being spread across the calendar.  There was a time not too long ago when every day at Saratoga was a big day.

NYRA has done a great job improving living quarters for back stretch workers.  I guess I am paying more attention to the Oklahoma training track now that I have a couple of horses over there.  I knew about the new dormitories that were built recently, but missed the refurbishing of existing dorms.  I haven’t been inside them, but the exterior structures and the addition of air conditioning are a commendable improvement by NYRA to improve the conditions of those who are with the horses 24/7.

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NYRA needs to work on its treatment of trainers.

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This sign is along the rail at the Oklahoma Training Track in an area used by trainers and owners to observe their horses working out.  In late morning it becomes a parking lot for fans.  When I was there Wednesday at 9:30  –  as fans were arriving and training hours were coming to an end  –  there were all of eight cars that presumably belonged to owners or trainers.  The sign is obnoxious and rude.

Most trainers  –  not the Bafferts, Pletchers and Browns  –  have small operations and are struggling to get by.  They are often at their barns from sunrise to sunset.  If they could park closer to their barns, they rather obviously would, so the sign is not necessary.

There is another issue, however, that rankles trainers even more.  NYRA seemingly cannot produce timely condition books.  For those not familiar with the term, a condition book is a schedule of the races NYRA intends to run over a period of several weeks.  It is a most essential tool in planning the training of a horse since it enables the trainer to pick out a race and train his charge accordingly.  NYRA, however, is notoriously late in releasing them.  The Belmont meet is a week away.  The condition book was just released on Tuesday.

It’s time for Chris Kay to stop talking about his museum.  At this year’s Jockey Club Round Table  –  a prominent national forum  –  NYRA’s CEO was a featured speaker.  In describing NYRA’s capital improvements, the first two he identified were his own creations,  the so-called Walk of Fame incorporating the Red Jacket winners and the Durkin Replay “Center.”  The Durkin Replay “Center” is a monitor affixed to a pillar in a bar.  The Red Jacket ceremony is a superfluous event recognizing people who are in the Hall of Fame located across the street.  This year’s Red Jacket ceremony was an interminable production between races that delayed the start of the next race.  No one goes to the Walk of Fame.

While this presentation was embarrassing in its own right, it was particularly so when compared to the talk of Winfried Engelbrecht-Bresges, CEO of the Hong Kong Jockey Club, describing the remarkable changes brought by that organization’s management.  While Kay boasted of bringing the Goo Goo Dolls to perform after the races on Belmont Stakes Day, Hong Kong markets a Wednesday night card to attract a younger audience and draws 18,000 to one of its tracks.  It has also dramatically increased handle  –  or, as they refer to it, “turnover.”

Will NYRA start counting cats in the attendance figures?

DSC_5292

 

Audit exposes NYRA nonsense

Posted by noonante on June 13, 2016
Posted in: Horse Racing, Political/Social commentary, Politics. Tagged: , , , , , , , , . Leave a comment

New York State’s Comptroller, Thomas DiNapoli, released an audit of the financial practices of the New York Racing Association.  He concluded that NYRA “continues to produce multi-million dollar annual deficits in its racing operations,” and that continuing this trend means that “NYRA’s long-term solvency could be a long shot.”

While this may come as a surprise to those who believed NYRA CEO Chris Kay’s constant proclamations that the organization was finally running in the black after years of deficits, it was obvious to anyone who went beyond press releases and actually looked at their financial statements.  The audit comes at a particularly resonant time since the Legislature is due to take up legislation this week concerning the future of NYRA, including a bill proposed by Governor Andrew Cuomo that would degrade significantly NYRA’s financial situation.

The audit covers the three years ending in 2014, during which NYRA was largely controlled by the Reorganization Board put in place by the Governor and Legislature in mid-2012.  CEO Kay has been in charge for the second-half of that period.

DiNapoli concluded:

  • NYRA is incurring significant operating losses from racing unless it includes the revenues from Video Lottery Terminals guaranteed by law;
  • NYRA’s assertion that it is operating profitably without the VLT revenues is based on the exclusion of certain operating expenses, for which “there is no authoritative accounting or financial reporting justification,” and is “very misleading;”
  • NYRA had not developed a plan to eliminate deficits from racing operations as recommended by the Franchise Oversight Board;
  • As an example of questionable expenses, it cited the NYRA Board’s awarding a $250,000 bonus to CEO Kay even though he had not met goals of achieving profitability without the VLT revenues or developing a plan to do so.

Central to both the audit and the Governor’s legislation to again revamp NYRA is the role of VLT payments.  While there are those who question why racing needs the revenues from slot machines, it is an essential component of the agreement reached when NYRA transferred title to the state of the land on which its tracks sit.  One can question the wisdom of doing so, but it was a contract, the provisions of which are embodied in law.

The Governor is now proposing that the VLT payments for racing and capital expenditures to NYRA be reduced from $57.5 million to $46 million.  Given that there is no dispute on NYRA’s numbers, irrespective of how they are characterized, it should be obvious that this would be a devastating blow to New York racing.

NYRA finds itself in the position of possibly absorbing this hit because of its “success” in convincing the media and outside groups of a dramatic turnaround in its finances.  As the audit demonstrates, however, the supposed turnaround borders on fraud.  John Hendrickson, the Board member from Saratoga who resigned when it became clear that the Governor did not need any independent advice, dismissed the Government’s impact on restoring NYRA to profitability, saying it would occur solely because of the VLT revenues.  He put it succinctly in BloodHorse.com:

“For the Governor to say ‘I saved racing’ is like taking your friend out on a boat and throwing him over with concrete sneakers and rescuing him.”

Among DiNapoli’s criticisms of NYRA are questionable expenditures.  Because it did not occur during the period covered by the audit, we will have to wait for the next one to get his views on the Chris Kay self-tribute that is the large structure he built in Saratoga in 2015 to celebrate those who Kay thinks should be celebrated.

This year, he apparently decided to celebrate the audit findings by announcing that he had commissioned a new Triple Crown trophy.  While I am sure that this was done following a competitive bidding process, he remarkably came up with someone he worked with while at Toys ‘R Us.

NYRA does have government bodies overseeing it, including the Gaming Commission and the Franchise Oversight Board, but each entity is controlled by the Governor’s appointees.  The audit raises an issue of their effectiveness.  I have been writing about NYRA’s questionable practice of claiming profitability by moving obvious operating expenses “off the books,” but I do not recall any one in either of these groups questioning it.  (Indeed, a member of the Franchise Oversight Board questioned Kay upon hearing of his plan to expand his self-tribute at Saratoga then demurred by saying, “You don’t have to tell me if you don’t want to.”)

This all comes to the fore because the close of the legislative session is Thursday, at which NYRA’s future is to be determined.  The Governor’s bill retains his control by effectively giving him say over 13 of 15 Board members.  The legislative bills are not much better because they would give a majority of Board appointments to those decided by the Governor’s loyalists.  The Governor’s bill would also strip $11.5 million from a NYRA that an independent source has now raised questions as to its long-term viability.

I think there is an appropriate role for government involvement in a future NYRA.  I do not think the Governor should control the future Board, but rather there should be an independent and professional panel naming so-called “private” Board members.  And, if we want truly independent government oversight, put the Comptroller on the Board.

The future of New York’s racing and breeding industries is at an important crossroads.  It could all go under if responsible figures do not act responsibly.

 

 

Returning New York racing to private control – a proposal

Posted by noonante on March 30, 2016
Posted in: Horse Racing, Political/Social commentary, Politics. Tagged: , , , , . 1 Comment

At the meeting of the New York Racing Association’s Reorganization Board on March 10, CEO Chris Kay announced that a proposal for returning NYRA to private control would be presented for the Board’s approval during the week of April 11.  While government control of New York racing is supposed to end, the anticipated plan will continue to ensure that the racing franchise remains under the control of Andrew Cuomo.

When Governor Cuomo seized control of NYRA with a complicit legislature in 2012, the stated purpose was to have state government run the racing franchise for three years.  Of the 17 members of the Reorganization Board, 12 were state government appointees.  The Board was to present a plan by April, 2015, to return to private control by October, 2015.  Even though this was the only specific responsibility assigned the Board, it did not do it, and new legislation extended both deadlines by a year.

NYRA’s General Counsel presented a proposed plan at a Board meeting in November, 2014.  It can be viewed at NYRA’s web site here.  The 29-page PowerPoint presentation could have been done on a single page of paper, and there are only two components of the plan that might be controversial.  The first is a reduction in the size of the Board.  The other is the method for selecting the new Board.

The prior NYRA Board had 25 members;  the Reorganization Board has 17 slots, although only 15  are active because the Governor has not filled one of his vacancies and another of his appointees has been on a leave of absence.

The stated rationale for reducing the number of members is that a smaller board would be “small enough to be agile;  large enough to represent multiple perspectives.”  Lack of agility has not been an issue with this Board.  Despite the myriad of significant issues confronting racing in general and New York in particular, they complete most of their meetings in less than an hour.  There is rarely any discussion, and to the extent there are votes, they are on minor matters.  Most of the votes taken by this Board since it began in December, 2012, have been the approval of minutes from the prior meeting.

Representation of multiple perspectives would indeed be a refreshing change.  Since the initial Board was appointed more than 41 months ago, only two women have been appointed, one of whom resigned.  There has never been a Latino/a member or a non-white member.  It has been older white businessmen.  Some have been owners and breeders;  others have no background in racing.  The organization representing horsemen does not have a vote, nor does the group representing New York’s breeders.

That brings us to the most troublesome aspect of the NYRA proposal  –  the method for selecting members of a new Board.  The 2014 proposal called for new Board members “to be selected by the current Executive Committee of the Board upon recommendation of the Nominations Committee after consultation with all Board members.”

The Nominations Committee has five members:  three appointed by the Governor, one by NYRA, and one by then-Speaker Sheldon Silver.  The Silver appointee, Michael Del Giudice, has been a close confidant of the Cuomos going back to Mario Cuomo’s tenure as Governor.  He also serves as the Chair of the Board since Cuomo’s nominee to be Chair, Anthony Bonomo, has been on a leave of absence since being a prominent figure in the federal corruption trial of then-Senate President Dean Skelos.

The Executive Committee has six members:  three appointed by the Governor, one by Skelos, one by NYRA, and Del Guidice, serving as the Chair of this Committee.

There is only one member of each committee not appointed by a state government leader.  Four of the five members of the Nomination Committee are effectively controlled by the Governor.  Four of the six Executive Committee members are Cuomo loyalists.  There is the possibility that these groups will simply name themselves or other members of the current Board to a new Board.  The notion that NYRA will be returned to private control when all of the new Board will be appointed by the Governor’s hand-picked cronies is as farcical as it is ludicrous.

I think any fair-minded observer would agree that the three attributes most needed in a new NYRA are integrity, independence and competence.

New York’s residents have observed a lengthy and persistent strain of corruption among its elected officials.  When both the Assembly Speaker and Senate President are convicted of corruption just months apart in 2015  –  not to mention the myriad of other convictions of legislative figures  –  no New Yorker can be confident that decisions are based on merit and not political contributions or illicit money.  And while the Governor has not been accused of illegal conduct, his most recent nominee to chair the NYRA Board, Anthony Bonomo, figured prominently in the federal corruption trial of Dean Skelos.  Skelos was convicted of several crimes, including soliciting a bribe  –  successfully  –  from Bonomo, who has been a major political contributor to the Governor.

Independence is a prerequisite for any Board of Directors that takes its fiduciary obligations seriously.  It is especially necessary in the hyper-political environment of New York.  While Governor Cuomo’s micromanagement of the smallest details of state government is legendary, it is Michael Del Giudice who can give us the best perspective.  He was quoted in Michael Shnayerson’s Cuomo biography, The Contender, discussing the prior NYRA:  “Andrew is like a younger brother to me, but if there’s ever a moment when he can take political advantage, he’ll cut someone off at the knees, me or anyone else.”  From someone who may play the most prominent role  –  if not the only role  –  in selecting a Board under the NYRA plan, it’s not exactly a comforting message for the tens of thousands who depend on New York racing for their livelihood, let alone racing fans.

As for competence, there is little this NYRA Board has done that suggests it is up to the task of leading New York racing in the 21st century.  Its most recent Board meeting provided yet another disturbing example of how badly it is in over its head.  The topic was federal legislation introduced in July, 2015, and co-sponsored by Congress Members Andy Barr and Paul Tonko, who represents Saratoga Springs.  The legislation isn’t complex  –  it’s not a 2000-page bill overhauling the health care system.  Its central feature is one that would create an anti-doping agency similar to one that exists for human athletes.

Even though regular readers of the racing media are familiar with this controversial legislation, it appeared to come as news to the NYRA Board members.  One thought that it was a NYRA proposal and did not understand why the feds had not yet acted.

They ended up supporting the bill with almost no discussion  –  let alone an informed one  –  as a token gesture of support.  They did so with an erroneous conclusion that New York could continue with its anti-doping efforts even though the legislation specifically states the new agency “shall have exclusive jurisdiction for anti-doping matters.”  That’s right  –  one of the two most significant racing entities in the United States took eight months to get around to this bill, did not understand it and concluded they had little influence over it.  (I no longer count Churchill Downs as a major racing organization since they appear to be primarily a casino company and only care about two days of racing each year.)  If that is the level of involvement in a major issue in national racing, one can only be apprehensive about their commitment to coming up with a new structure for NYRA.

There is, however, an approach to selecting a new Board that will address the matters of integrity, independence and competence.  And, it’s something New York tried the last time it sought to address a crisis in public confidence at NYRA.

Here is a proposed approach (all members have voting rights):

  • Governor appoints three members;
  • Senate President appoints one;
  • Assembly Speaker appoints one;
  • Comptroller or Attorney General appoints one;
  • New York Thoroughbred Horsemen’s Association appoints one;
  • New York Thoroughbred Breeders appoint one;
  • Nine members appointed by Special Committee.

The Special Committee would be comprised of recognized industry leaders who have had hands-on experience in managing some aspect of the racing business.

There is a precedent for New York to address a crisis in racing by turning to a panel of recognized experts.  In early 2012 when a rash of catastrophic breakdowns plagued the Aqueduct inner track, government officials and NYRA appointed the New York Task Force on Racehorse Health and Safety to investigate the causes and recommend improvements.  The four members –  Dr. Scott Palmer from New Jersey, Alan Foreman from Maryland, Dr. Mary Scollay from Kentucky, and retired jockey Jerry Bailey  –  produced a lengthy report.  Their product was widely praised and could serve as a guide for tracks around the country in improving equine and human safety.

While the NYRA executives and the Reorganization Board may believe their press releases about the great job they are doing, it is not a sentiment shared in either the backstretch or the grandstand.  The only way to restore confidence is to come up with a new Board that promotes integrity, independence and competence.  Governor Cuomo knew that when he directed the head of NYRA in 2012 to “hire a qualified independent investigator or team of investigators” to review the circumstances of the Aqueduct fatalities.  And it worked  –  I have never seen any criticism of the work done by the Task Force, and racing fatalities at the NYRA tracks have declined over the past four years.

The Special Committee envisioned by this proposal would consist of persons from within New York and outside.  There is no shortage of respected, knowledgeable and committed figures who could serve on such a group.  Indeed, the members of the Task Force serve as a useful starting point.  The Committee can prepare a list of 15 nominees from which the current Board, voting in a secret ballot, can select nine of their successors.

Such an approach may not be perfect, but it would be insulation from a charge that “it’s just New York politics as usual.”  It will maintain a level of involvement by New York’s government without ceding complete control to them.  One reason the report by the Task Force on equine safety was accepted so readily was that the members had earned wide respect in the racing industry and were independent.  While the NYRA Board members identified in the draft proposal to name new Board members may have their strengths, independence is not one of them.

It is important that New York get this right.  There is too much at stake for this to be treated as just another exercise in political gamesmanship.

 

 

 

A year-end look at New York’s racing oversight agencies

Posted by noonante on December 23, 2015
Posted in: Horse Racing, Political/Social commentary, Politics, Saratoga thoughts. Tagged: , , , , , , . 3 Comments

In recent weeks, there have been meetings of the three New York government agencies that have responsibility for oversight of the state’s premier racing franchise run by the New York Racing Association.  It was a dispiriting and dismal look at groups who collectively  –  and individually  –  do nothing to warrant hope for the future of racing in this state.  This comes at a time when control of NYRA is due to revert to a not-for-profit entity instead of the current control by state government.

There is the NYRA Reorganization Board put in place in 2012 when Governor Andrew Cuomo seized control of the prior Board using phony claims of wrongdoing.  The Board is responsible for overseeing racing at the three NYRA tracks at Saratoga, Belmont and Aqueduct.

Then we have the Franchise Oversight Board that was established by law at a time when NYRA was experiencing financial problems.  Its purpose is to provide independent oversight of NYRA’s operations, including the Reorganization Board.

Finally, there is the Gaming Commission which has regulatory and adjudicatory authority over all forms of legal gambling in New York, including racing, casinos and the lottery.

NYRA Reorganization Board

The Board has been in existence for more than three years.  I have either attended or viewed a webcast of every meeting.  They are nothing more than a colossal waste of time in which the sole purpose appears to be to fill an hour.  This meeting did have a significant matter to present  –  the budget for 2016 as well as a review of this year’s financials.  That took less than ten minutes.

What was not raised at the meeting  –  and this a group that continually pats itself on the back for its transparency  –  is that the price of tickets for the Belmont Stakes are again going to be increased, according to David Grening of the Daily Racing Form.  CEO Chris Kay seems to think that Churchill Downs is a model for customer satisfaction and is moving in the direction of emulating the host of the Kentucky Derby.

There was also no mention of NYRA’s plan for reintroducing off-track betting to New York City, a matter that would seem to be crucial in growing the fan base.  This is a matter that has been on their agenda for the three years, and prior “plans” have called for getting wagering terminals into restaurants and bars.  Kay informed the Franchise Oversight Board two days earlier  –  but not the NYRA Board  – that he hoped to implement a plan whereby one could bet on their IPhone or tablet at a bar or restaurant.  So you just have to ask the bartender to turn one TV to an OTB channel and you are now an OTB.

There was one moment at the meeting that was downright surreal.  Acting Chairperson Michael Del Giudice described the awarding of the Triple Crown Trophy, and noted a comment by the Governor about how heavy it was.  There’s only one problem.  As reported by numerous news outlets, the Governor’s excuse for missing this year’s Belmont Stakes was the need to go to Dannemora to take charge of the effort to catch two escaped murderers.  Now it is perhaps a small step for an organization that will inflate actual attendance by up to 8,000 people who did not show to add one more.  But recounting a conversation that could not have taken place is another matter.

Franchise Oversight Board

The make-up of the NYRA Board was raised as a concern by James Towne, a member of the FOB, at its most recent meeting.  Towne was questioning the qualifications of Georgeanna Lussier, the most recent appointee to the NYRA Board.  He seemingly disparaged her as a “political appointee,” even though 12 of the 17 positions on the NYRA Board are appointed by the Governor (8) and the Assembly Speaker and Senate President (2 each).  Towne himself is a political appointee, as is each member of the FOB.  Perhaps he thinks that when one is appointed by the Governor that it is more akin to an ordination than a shabby political act.

It is interesting that Towne selected for criticism the only woman on a board otherwise consisting of older white men.  The FOB itself has one woman member of its five;  the seven-member Gaming Commission  –  each of whom is a poltical appointee  –  has none.  Now, Lussier is not immune from criticism because of her gender.  But no one who sits through any meeting of the NYRA Board could conclude that she is somehow dragging down the performance of the Board  –  which is non-existent.

Towne’s concerns about the composition of the Board might have more credibility if he did not single out one of the Assembly Speaker’s two appointees, and instead asked why his patron the Governor has yet to replace the prior Board Chairman who announced his departure 18 months ago.  Or, perhaps question the status of another Cuomo appointee who recently testified in the Dean Skelos trial under a non-prosecution agreement.

Towne also questioned the schedule of Saratoga’s training track.  Under the performance goals set by the FOB for NYRA, the facility must be open “from at least April 15 through November 1 of each year.”  Glen Kozak, NYRA’s Vice-President of Facilities observed that less than ten horses used the track in early October, and assured Towne that NYRA would be proposing a reduced schedule.  Two days later at the meeting of the NYRA Board, Georgeanna Lussier asked Kay about this.  Kay  –  who sat opposite Kozak at the FOB meeting  –  lamented the misinformation that had folks wondering if the track would be closing in early September.  He raised the number of horses to “two dozen in stalls” by the end of October, and seemed to assure Lussier there was little to worry about.

Another issue that came up at the FOB but not at the NYRA Board is Kay’s intention to spend $250,000 to expand what he calls the Walk of Fame at Saratoga, but in reality is little more than a tribute to himself.  It is a project that required the removal of trees from the backyard, was not wanted by anyone, and is not used.

Gaming Commission

I wrote at length about the Gaming Commission’s response to allegations by the People for the Ethical Treatment of Animals against Steve Asmussen and his staff at Churchill Downs and Saratoga in 2013 in this post.  Asmussen is a multiple violator of drug regulations and was determined by the Commission to have committed 58 additional violations during the 40-day Saratoga meet.  The Commission levied a fine of $10,000 even though the report by the Commission’s staff concluded that the minimum fine for such violations would have been $29,000.

At Monday’s meeting of the Commission, members said they needed more time to digest the staff report.  It’s not clear why they sought a delay.  Asmussen was fined  –  with no involvement by the Commission members  –  and draft regulations to correct issues identified by the staff have already been circulated for comment.

It is not unlike what the Commission has done on the issue of Lasix use.  The Commission  –  to its credit  –  convened a day-long forum on Lasix during the Saratoga meet.  While more heat than light was shed on the subject, the sole concern expressed by Commission members coming out of that had to do with the cost of administering the drug.  Not with whether race-day administration is beneficial to the horses or harmful to the industry’s reputation, but how much money was spent as if this is an economic development issue.

Conclusion

What is particularly disturbing about the ineffectual oversight evidenced by all three of these government agencies is that a new model for control of NYRA is to be presented by April, with a change to the new structure in October. We now have a situation where the NYRA CEO says one thing to an oversight body on important matters but not to his own Board. Sometimes what is said is contradictory at meetings just two days apart.

Even worse, however, is the passive approach taken by the Acting Chair of NYRA’s Board, Michael Del Giudice.  At the December 9 meeting, he informed the Board that the decision on a new structure would be decided by the Governor and the Legislature, and added NYRA “will give our input or recommendations if they want it.”

Of course, the final structure will be decided by the Legislature and Governor since they are the only ones able to enact laws.  But the sole responsibility given to NYRA in the 2012 Reorganization law was to present a plan by April, 2015 to restore a not-for-profit organization for implementation by October, 2015.  NYRA did nothing, and the law was extended for another year.

While we would like to think that those most knowledgeable about the industry would have a major say in what should happen, it is clear that none of the government agencies have that knowledge, and there is no indication that those with valuable insights and perspectives will be given the opportunity.

 

Audit slams NYRA mismanagement

Posted by noonante on October 19, 2015
Posted in: Horse Racing, Political/Social commentary, Politics. Tagged: , , , , , , . Leave a comment

Thomas DiNapoli, New York State’s Comptroller, sharply criticized the management of the New York Racing Association for its failure to plan capital expenditures.  The findings are not surprising to anyone who has observed the government-controlled agency in action, but is yet another disturbing red flag for the future of racing in New York.

Under New York law, the operator of the racino at Aqueduct pays a share of its net revenues to NYRA:  a defined percentage is for capital expenditures, another for purses and a third for operating expenses.  The audit examined what NYRA does with the money for capital expenditures.

DiNapoli concluded  –  unremarkably one would think  – that “[s]ound business practices include both long-term and short-term capital project planning,” but “NYRA’s planning was weak.”  Particularly disturbing is that the Comptroller’s office cited NYRA for similar deficiencies in 2007, shortly before NYRA filed for bankruptcy.

While NYRA did submit capital plans to its Board of Directors, the documents were apparently not worth the paper they were printed on.  DiNapoli’s office found that over $7 million was spent on projects that were not included on the submitted plans, and another 114 projects that were on the lists were not initiated during the audit period.

As an example of the lack of planning, DiNapoli cited the Longshots simulcast facility and sports bar that was built at Aqueduct.  Genting, the racino operator, was committed to paying $5 million with NYRA being on the hook for anything over that amount.  In large part because of change orders, the cost spiraled to $9.4 million.  According to the report:

“The three largest change orders, exceeding $1 million, related to the installation of audiovisual equipment and HVAC-related work.  Because these items were basic to an indoor simulcast center, we question how and why they were overlooked to such an extent in the original planning and design of Longshots.”

That fiasco  –  the project was also delayed by two years  –  is typical of NYRA’s “management” of capital projects.  The DiNapoli audit also faulted NYRA for not adhering to basic components of any capital plan:  “its annual plans lacked pertinent details regarding the projects to be financed, such as completion dates, and support for their associated costs.”

In addition, DiNapoli faulted NYRA for using funds intended for capital projects on routine maintenance.  That allows NYRA to maintain its well-publicized fiction that it is now operating in the black without consideration of VLT revenues.  Of course, when VLT revenues for capital projects are reducing the need to rely on operating revenues, it becomes the NYRA version of three-card monte.

NYRA responded to the audit by denying any deficiencies in its planning, while not disputing any of the factual conclusions in the audit.  As they are wont to do when criticized, they blamed others for any issues.  Genting was to be blamed for Longshots because they were in charge of the project, ignoring that when you are exposed for what turned out to be almost half the costs, a responsible manager would intervene.  The state’s Franchise Oversight Board  –  a group like the NYRA Board composed largely of Cuomo appointees  –  was identified as having approved the plans NYRA submitted.

NYRA also cited what it has done for long-term capital planning.  It appointed a Long-Term Planning Committee at one of its first Reorganization Board meetings almost three years ago. To the best of my knowledge  –  and I have attended or observed every Board meeting  –  this Committee has never done anything, other than recommending an $800,000 consultant to advise it on long-term planning.

NYRA further said it “has been, and is currently, engaged in significant long-term planning for Saratoga.”  They are referring to a comprehensive plan for the track prepared by Turnberry Consulting, and available on its web site.  One of the most significant changes recommended by the report is eliminating the parking inside the fence along Union Avenue, and replacing it with an expanded area for picnic tables and an amphitheater.  At a Saratoga preview held at the Museum of Racing  –  across the street from the site of the parking area  –  NYRA’s CEO and President Chris Kay had no idea that this was being proposed.  So much for NYRA’s “engagement.”

It would be one thing if this the lack of capital planning was an aberration  –  and, of course, not identified as a deficiency eight years earlier prior to a bankruptcy filing  –  but NYRA’s inability to plan is a major problem. The 2014 Belmont Stakes was not a fiasco because of the unexpected, but because of a lackadaisical approach to even the most rudimentary planning.  The NYRA Board has been talking about restoring off-track betting to  New York City for the three years of its existence, yet nothing has happened.

There is one area, however, that is the most troubling.  The one thing that the NYRA Reorganization Board was required to do in the legislation written by the Cuomo Administration was to come up with a plan to return New York’s premier racing to a not-for-profit entity instead of a government-controlled one in April of this year.  It is the only thing they were required to do.  The transition was to happen this month.  They did not do it, and the budget for this fiscal year extended both deadlines for a year.

If this persistent, demonstrated incompetence is not enough to cause you concern, ponder this.  A proposal drafted by NYRA’s General Counsel and presented to the Board last November called for the current Board to appoint the new one under a reorganization plan.  That’s right, the idea to get the government out of running New York’s racing was to have the government appointees select their successor.  What could go wrong with that idea?