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N.Y. Comptroller wants NYRA supervised

Sep 23, 2003 4:41 AM

The New York State Comptroller wants those slot machines operating at Aqueduct racetrack as soon as possible but not necessarily under the aegis of the New York Racing Association.

In a stinging report, Comptroller Alan Hevesi called NYRA "out of control" and demanded that a full-time inspector general be appointed to supervise its operation in order to preclude a "real risk to racing and to the state economy."

And Hevesi said he had asked Gov. George Pataki to create a gaming commission to oversee the slots as well as bingo and other gambling in the state. He noted that MGM MIRAGE Inc. (MGG) had backed off constructing a facility and operating some 4,000 slot machines for fear that NYRA would be indicted following a report by Atty. Gen. Eliot Spitzer indicating possible indictments on tax fraud, money laundering and other crimes allegedly committed by low-level employees.

In his report, Hevesi charged that NYRA needed dramatic reform since it "is a critical industry for the people of this state." He also alleged that NYRA had claimed certain tax deductions submitted to the Internal Revenue Service without having made those interest payments. He said he had referred the matter to the IRS.

A NYRA spokesperson denied the Hevesi allegations and said part of them resulted in the comptroller not understanding the unique finances of the private agency operating on a public franchise. Also, she said the IRS deductions were appropriate since NYRA had been paying all state-backed loans.