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.