Friday, May 8, 2009

Bids For N.Y. Aqueduct Slot Parlor Due Today

By Ken Davison
Feather News


Bids are due today from those groups seeking to run a proposed slot parlor at New York's Aqueduct racetrack in Queens, N.Y.

Various rounds of bidding have gone on for close to two years and New York officials thought the deal was done when the Delaware North group was finally chosen last October. But in March, Delaware North backed out of the deal saying that it could not come up with the $370 million up-front payment that it promised in its bid. Others say that discussions of the possibility of a second Queens racetrack slot parlor at Belmont racetrack, that would be in direct competition with the Aqueduct slot parlor, was a big factor in Delaware North's choice to abandon the deal.

The Mohegan Tribal Gaming Authority, along with partners that included an Australian group of racing professionals and others, was one of the unsuccesful bidders. Now that the bidding has been re-opened, the Mohegan Tribal Gaming Authority may once again seek to compete with others for the 30-year franchise to operate the slot machines.

The prospect of what would be New York City's first slot parlor is expected to cut into the revenues of the Mohegan Sun as did New York's Yonkers racetrack slot parlor, located just outside of New York City. New York officials want an up-and-running Aqueduct slot parlor to have 4,500 VLT slot machines.

Hartmann said the authority has not decided whether to partner with another entity on a new bid.

Two weeks ago chief operating officer of MTGA, Jeff Hartmann said, "We're running models of the competitive landscape and haven't decided whether to provide a bid." Attempts to contact Mr. Hartmann today were unsuccesful but it is likely the Tribe will once again bid on the franchise.

The Mashantucket Pequot Tribal Nation was also involved in the first round of bidding but officials there do not contemplate bidding on the project again. Gary Armentrout, president of the Mashantucket Tribe's Foxwoods Development Company, told The Day newspaper two weeks ago that it was not likely that they would bid once again for the franchise.

Other groups that were involved in the earlier bidding included, MTGA/Capital Play, Delaware North and the Seminole Tribe's Hard Rock/SL Green group.

The winning bidder would need approval from the governor, the state senate majority leader and the leader of the state's legislative assembly.

An added incentive has been added to the new selection process: a quasi-state agency will provide $250 million in funding toward the construction of a facility.

In the initial round of bidding two years ago, the Mohegan Tribal Gaming Authority's group first lost the bid to operate the racetrack and, later, lost a bid to develop and operate the slot parlor. Upon losing the bid to operate the racetrack, the group then ran television commercials criticizing the governor on its selection of New York Racing Association to operate the state-owned racetracks.

The subsequent resignation of that governor, Eliot Spitzer, due to other matters was seen as helpful in the previous Mohegan bid because the governor is one of the parties that is required to approve the winning bidder.

Note: Later this afternoon it was reported that the Mohegan Tribal Gaming Authority "elected to pass on a bid to construct a a casino at Aqueduct Racetrack." Hartmann said, "We determined that an investment of capital and resources at this time, does not align with our stated goals to continue to strengthen our balance sheet."