NYRA still cash poor

Dec 6, 2005 3:48 AM

Faced with a likely lawsuit, Sotheby’s auction house canceled the proposed sale of expensive artwork that has decorated the walls of New York’s three thoroughbred racetracks, Belmont, Aqueduct and Saratoga.

The art auction was ordered by the New York Racing Association (NYRA) in order to raise cash to pay its operating expenses.

Michael Hoblock, who has since been deposed as chairman of the New York State Racing and Wagering Board, threatened the lawsuit charging that the NYRA directors own only a franchise while all physical materials are owned by the state.

His replacement as board chairman, Cheryl Buley, who has been serving on the two-man board with Hoblock, reiterated the state’s position that prohibited NYRA from selling anything.

That position saddened Bill Nader, NYRA executive vice president, who said the auction would have brought about $1.3 million to the cash-poor operator. He said NYRA also planned to sell 80 parcels of land in and around Aqueduct racetrack, a decision that now remains in limbo.

Without a cash infusion, he said, NYRA was considering a bankruptcy filing. Exactly what that would do to its franchise, which expires at the end of 2007, remained as a question. Some legislators have suggested that the franchise be nullified and that a new racetrack operator replace NYRA.

Powerful Senate Majority Leader Joseph Bruno, a former longtime NYRA supporter, has turned against the operators and has recommended that a new franchise be awarded within the next six months.

"Let’s do it sooner rather than later," he was quoted as saying. He has called for an RFP (request for proposals) to be drafted to expedite the franchise award.

The replacement of Hoblock as board chairman came swiftly on Nov. 29 when he refused to resign upon the request of Gov. George Pataki, who immediately bounced him from the chairman’s post.

Hoblock has been on the job for the past eight years and has an appointment that will keep him there until 2008, if he wishes. However, a spokesman for the governor said that "Hoblock has indicated to us his desire to leave the board and we expect him to resign in the very near future."

Pataki reportedly is looking to replace Hoblock with Bernadette Castro, his parks commissioner. She also serves as one of three members of a new state panel overseeing NYRA’s franchise.