And then NYRA made the mistake that triggered a cataclysm. With the expiration of a state law, the takeout from certain wagers in New York was supposed to be reduced from 26 percent to 25 percent, but nobody in NYRA (nor any of the tracks’ state overseers) spotted the error until bettors had been short-changed by $8.5 million. This surely wasn’t deliberate — most of the money went not to NYRA but to the various outlets around the country that handle wager on New York races.
But the event confirmed, to its long-time critics, what a corrupt and incompetent entity NYRA was, and it turned into a full-fledged, headline-making scandal. NYRA’s board fired Hayward and general counsel Patrick Kehoe, perhaps hoping that these sacrifices would appease the governor.
He was not appeased; this was Cuomo’s opportunity to execute a coup. The governor is a staunch supporter of the casino industry, which can generate significant revenue for the state, not to mention large political contributions. Because of the law giving racetracks a subsidy from slot-machine funds, horse racing siphons away money that politicians want for their own aims. Cuomo sought to take control by changing the composition of the NYRA board, reducing it to 17 members, eight of whom will be appointed by the governor and two each by the Senate and Assembly.
Blogger Tom Noonan (www.tenoonan.com), an attorney and small-scale horse owner, has written more incisively about the NYRA situation than almost anyone in the mainstream media, and he declared that the governor and his staff “engineered a coup . . . [and engaged] in . . . assaults on the integrity and character of NYRA Board members without citing any evidence justifying the attacks.”
Without Hayward to fight back, NYRA quickly folded under Cuomo’s pressure. The New York Post editorial page cheered: “The long-disgraced NewYork Racing Association is about to be put out of business.” And it applauded the governor for “tackling a culture that has been a breeding ground for corruption.”
The suggestion that New York politicians will clean up horse racing corruption ought to sound like a joke to anyone familiar with the state’s history. When off-track betting in the state was legalized in the 1970s and placed under the control of various regional political entities, it became a cesspool of political patronage and mismanagement. New York City Off-Track Betting accomplished the feat of going broke running a business in which losing money was almost impossible. When the state legislature passed the law authorizing a casino at Aqueduct, the process of awarding the franchise took 10 years and was marred by so much influence-peddling that the Inspector General described it as “a veritable case study in dysfunctional and politically driven government.”
People involved in New York racing have ample reason to be worried about what will happen when the state takes control. And because New York is the center of the sport in the United States, the nation’s thoroughbred industry ought to be worried, too.