Odds On Racing - Harness Racing

Horse Racing & Politics

June 18, 2008

Two horses that finished first on a recent day at Belmont Park serve as living reminders of this year's dramatic changes in political leadership.

The winner of the sixth race on May 30 was Steamroller, which of course was the nickname of ex-Gov. Eliot Spitzer. The winner of the eighth race was Stud Muffin - which could also be his nickname, or his successor's.

Horse racing and politics are always tightly fused - so much so that the sport sometimes seems like its own branch of government.

Mayor Michael Bloomberg forced the crisis this week that led the state to take over the city's OTB. This operation has more than 60 locations, 1,500 employees and nearly $1 billion in annual handle, a huge chunk of the statewide racing take. But Bloomberg threatened to close it because under current formulas for divvying up the revenues among racing's stakeholders the city was about to get less back than it cost to run the place.

Along the way, Gov. David A. Paterson reportedly compared the mayor's petulance in negotiating the issue to Spitzer's. Abruptly, the subject shifted from horse races to governor's races. But while this latest political blaze has been doused, underlying fiscal issues still smolder - specifically on Long Island.

In the short term, the New York City deal allows Suffolk and Nassau OTBs, and the state's other four regional OTBs, to take out a percentage point more of what they collect from winnings. But those who know the game have warned for years that a bigger county bite is not the long-term answer, since taxing more and more of gamblers' prizes cuts their incentive to play.

Last year's racing crisis centered on the franchise to run thoroughbred tracks at Belmont, Aqueduct and Saratoga, which ultimately left the New York Racing Association in charge. Along the way, Jeffrey A. Casale, president and CEO of Suffolk's OTB corporation, circulated an earnest position paper, crafted two years ago, that was largely ignored in the political jockeying.

Today, with a new spotlight on OTB revenues, the time might be coming for Casale's proposals, which he says "are not rocket science." Like his peers elsewhere, Casale argues that the distribution of funds netted by OTBs to racing's other stakeholders does not work and produces a shrunken pie and too little return to local taxpayers. Last year Suffolk OTB, the only off-track operation without a track in its region, returned about $2.5 million to county coffers.

Casale and other OTB officials oppose a statewide merger but back a "confederation" of the six regional entities. This could create a single computerized betting system, a unified Internet wagering system, a statewide cable TV channel, a single phone wagering system, shared purchasing and combined marketing.

This is a lot like what some see as a solution to multiple special-taxing districts: Keep them separate, so they are locally responsive, while creating economies of scale.

While lawmakers acted this week to save the city's OTB, Paterson announced he is nominating one of his best-qualified former colleagues, state Sen. John Sabini (D-Jackson Heights), to head the state's racing board. Sabini will undoubtedly look at the Casale report, once confirmed.

Earlier this week, Newsday asked Sabini about recent statements from Nassau OTB's Dino Amoroso that his corporation was ready to take a leading role in new arrangements. "The governor has said he wants to look at all aspects of racing and OTB," Sabini said. "Certainly Nassau runs a very good program and we should look at it. ... We'll look at this dispassionately."

For Sabini, the move to the $120,000 post comes at an opportune time: His county Democratic organization was backing a primary opponent against him, threatening his ouster anyway at the polls.

With horse racing, politics is always just around the turn.