Aqueduct VLT Contract On Hold, But Why?
Three weeks ago, the lucrative contract was given to Genting New York, an offshoot of a massive Malaysian company that runs gambling venues throughout the world. Genting was the last company standing in a ten-year race to build the gambling Racino and revive the gambling industry in New York State.
Insiders say, however, that there are still several stumbling blocks before Genting begins construction, including a lawsuit brought by the Aqueduct Entertainment Corporation, a consortium that was granted the license only to see it taken away, and some new information that Genting might have ties to a Chinese businessman with mob ties. In addition, both Attorney General Andrew Cuomo and state Comptroller Thomas DiNapoli must sign off on the deal. As of press time, neither has done so.
Earlier this week, Governor David Paterson blasted DiNapoli and “his inept organization” for stalling the Racino project.
On Tuesday, however, DiNapoli said that he was not stalling, but simply doing his job. “Contrary to news coverage, my office is not holding up approval on the VLT contract.” DiNapoli said. “Even though my office has not yet received the executed contract with the appropriate approvals and signatures, we have been actively reviewing the VLT procurement, including the draft contract, since the Division of the Lottery awarded it three weeks ago.
During that time, we have been in contact with Lottery to address a number of questions and concerns. Late last week, we received a new, revised, unsigned draft of the contract from Lottery.”
“The VLT contract involves hundreds of millions of dollars. It’s a 30-year license that carries the future of New York’s racing industry on its back,” he added. “Both the Attorney General’s office and my office are conducting a thorough review of this document. After nearly a decade of false starts and broken promises, including three years under the current administration, it’s understandable, if reports are correct, that someone on the Governor’s staff is frustrated and anxious.
But given the checkered history of this deal, I must take every step to ensure the taxpayers are safeguarded in this contract. It’s New Yorkers’ money; it’s my job to protect it.”
Genting New York’s selection follows an extensive evaluation process modeled after State procurement rules. The Office of the Attorney General and Office of the State Comptroller must now review and approve the plan before the process can move forward, a spokesperson for the Lottery Division said. “After an extensive review of the applicants and the final Division of Lottery recommendation, I am pleased to announce my support for Genting New York to build and operate the video slots parlor at Aqueduct,” Paterson said. “Genting emerged as the winner of a highly competitive process that saw potential bidders narrowed from an original pool of seven down to one. I commend Senate Conference Leader Sampson and Assembly Speaker Silver for joining me in support of Genting New York and revitalizing the Aqueduct Racetrack.”
As the Lottery stated in its recommendation letter, “Genting’s proposal was far superior, in concept, scope, detail and execution, as compared to previous rounds of evaluation. Lottery’s strong recommendation is based on the merits of the proposal, which was vastly reinforced by Genting’s financial offer of $380 million as an upfront licensing fee. In addition, Genting is highly sensitive to the community issues, labor requirements and social concerns that a project of such scope encompasses.”
“In addition to the upfront fee, the Aqueduct facility will generate an estimated $300 million a year for Lottery Aid-to-Education statewide,” the lottery spokesperson added. “Locally, Genting’s development will generate 1,300 jobs during the construction phase and 800 jobs in the operation of the facility. The firm has also committed to donate one percent of net profits to the Queens community.”