Political interference on the part of New York Gov. George Pataki into the possible indictment of the New York Racing Association (NYRA) was strongly denied last week following the revelation that Pataki had sent a personal representative to talks between track officials and federal prosecutors.
Pataki’s spokespersons insisted the representative, James McGuire, a former top Pataki aide, simply attended the meeting to impress prosecutors that a NYRA indictment would cause serious economic problems for the area and the state.
The feds have been reviewing allegations that track officials cooperated with employees who committed personal income tax fraud and may have been involved in forms of money laundering. Fearing the repercussions of an indictment, NYRA leaders have been attempting to negotiate a fine to resolve the problem and forego an indictment.
Last week, construction of a facility to house as many as 5,000 video lottery machines at Aqueduct Racetrack was halted. NYRA has an agreement with MGM MIRAGE Inc. (MGG) to operate the facility. However, MGM MIRAGE management warned NYRA that they would not be able to continue with the VTL operation if an indictment is issued.
The track slot machines are expected to generate about $395 million for public education in the first year and as much as $500 million in the following years.
Prominent horse trainer John Ward, president of the Kentucky Thoroughbred Association and a participant in racing at Saratoga racetrack, called the whole NYRA problem "political."
Ward told the Blood Horse magazine, "This is no more than, in my opinion, an orchestrated political event. The shame of it is, a lot of people, and that includes me, come here to New York, not only Saratoga, for the quality of racing. The NYRA has done a tremendous job of keeping the quality of racing at the absolute highest level."