Batavia Downs

There was a large turn out Friday evening at Batavia Downs for the annual Festival of Hope to benefit Genesee Cancer Assistance.

GCA raised $30,000 this year.

The event featured a 5K walk/run, games for children, music, a Chinese Auction and haircuts and beauty treatments.

On left below, Paul C. Stomper poses with Dr. Kevin Mudd. Stomper was the keynote speaker Friday. The Batavia native has travelled the U.S. working with cancer patients and has authored a book, "Come Sunday, Inspiration for Living with Heart."  Mudd is president of GCA. You can find out more about Stomper and his book at ComeSunday.net.

More pictures after the jump:

There's a horse show going on at Batavia Downs. Riders from all over the northeast are in Batavia to test their skills and display their handsome mounts. If you've missed it, the show continues Sunday at 7:30 a.m. until 5 p.m.

More photos after the jump:

In an audit of New York's five regional off-track betting operations, Comptroller Thomas DiNapoli warned that OTB wagering has dropped precipitously over the past five years, threatening the viability of the OTBs.

Western OTB comes off a little better in DiNapoli's audit, primarily because the gains in video slot operations are more than offsetting the declines in horse wagering (full Western OTB report (pdf)).

Western OTB Corporate and Branch Operations has experienced a 10-percent ($15.6 million) decline in net handle (total amount bet) over the past five years. And through May 2009, its net handle was down over $5 million compared to the same time the previous year. In addition, live racing and inter-track wagering at Batavia Downs were down 7.6 percent in 2008 from the prior year and have decreased 25 percent since 2005.

However, the corporation’s new video-gaming facility has generated additional revenue for the OTB. As a result, operating revenues increased to more than $21 million in 2008 compared to nearly $17.6 million in 2004, a 19-percent hike. These increases have significantly affected revenue distributions to local governments, which have grown from almost $3.9 million in 2004 to more than $4.9 million in 2008.

In the report on Western OTB, DiNapoli expresses concern that VTL gaming could level off or decline, depending on the economy or changing competitive issues.

The Buffalo News received a written response from OTB President Martin Basinait, who said WOTB is "somewhat more optimistic."

But he said a number of changes can be made in state law to make the OTBs more competitive, such as changing the formula by which revenues are shared with tracks.

Basinait noted other past warnings from the state comptroller's office, including a 2005 report that found the OTB did not properly plan for the possibility of failure of Batavia Downs and the casino. He said the success of the casino has shown it was "not due to happenstance."

Basinait said DiNapoli's red flags about the future economic health of the OTB's casino are "unwarranted."

Harness racing isn't want it used to be and probably never will be again, according to newly elected Chairman of the Western Region Off Track Betting Board of Directors Dick Siebert.

In an interview with WBTA, Siebert characterized harness racing as "the cost of doing business." It's the loss leader that under state law allows Batavia Downs Casino to keep its doors open for the much more profitable video slot machines.

"The people that used to come to our parlors, the 55 and older men, are no longer 55 years of age," Siebert said. "Unfortunately, they're dying off. The newer group of people, it doesn't have the interest to them that it did with the old bettor. ... I honestly can't see where harness racing is going to turn around and ever be back where it was in the '50s, '60s and '70s."

He said in 2009, Batavia Downs lost $1.5 million on harness racing while the video lottery terminals brought in $3 million in profits.

To help reduce harness racing costs, more bets will be placed at electronic terminals rather than at the traditional caged window with a person taking the bet.

Meanwhile, Siebert said the Downs continues to work with state regulators on a plan to address deficiencies in some administrative procedures. He said the board is looking to hire a consultant to help address the state's concerns, rather than bring in a management company to take over the Downs' operations, which is one of the state's other suggestions.

Full interview available here (mp3).

The joint was hopping Saturday night at Batavia Downs, with more than 6,100 patrons on hand for a muscle car drawing and a live band in the Paddock Room.

There were 3.1 million credits played Saturday, and Marty Biniasz, director of marketing, said that is a new record, beating the 2.8 million credits played one night last march.

The muscle car -- a 2010 Camero SS -- was won by a guy named Jim (last name not released) from Le Roy. He opted for the $20,000 instead.

Players eligible for the drawing earned chances to win through play at the casino over the previous seven weeks.

Last year, the an OTB employee won the Dodge Challenger given away by the Downs. This year, Biniasz said, before the winner was announced officials made sure he wasn't an employee of the Downs, of OTB or the dealership sponsoring the contest.

To accommodate the large crowd, the Downs opened up the Paddock Room, where an 80s tribute band played live, and the grandstands were open with TVs tuned either to basketball or the Buffalo Sabres game.

Batavia Downs is not closing.

That's the message this morning from Western OTB Board Member Dick Siebert, who was part of a committee that met with State Lottery officials in Schenectady yesterday.

"We want our friends in the community and our employees to know that they're not going to be out of jobs," Seibert said. "Batavia Downs is not closing and that never really was the plan according to them (Lottery officials)."

The OTB told Lottery officials that they will begin immediately the process of hiring a consultant to help Batavia Downs come into compliance with Lottery regulations. The consultant will be hired in cooperation with the Lottery.

There have been no allegations of any misuse of funds, missing funds or serious wrongdoing. The Lottery issued a letter Feb. 3 raising concerns about procedural and administrative practices at the Downs and threatened to pull its video lottery terminals by March 1 if the Downs did not take steps to correct the reported deficiencies.

Siebert said he believes Lottery officials are now satisfied that the OTB board has a plan and is on the right track to address the state's concerns. The March 1 deadline has been lifted, he said.

"I'm sure as long as we show we're working diligently to do what the Lottery wants us to do, I'm sure the Lottery will be flexible (on the deadline)," Siebert said.

The consultant -- which must be approved by the Lottery -- will help the Downs comply with Lottery requirements and ensure it remains open.

The OTB is ready to do just about anything to avoid having the State Lottery pull all of the video lottery terminals from Batavia Downs Casino.

That was the message from Western OTB attorney Timothy McCarthy following a closed session meeting of the board at the casino and racetrack this morning.

"They're the boss and it's important they are treated as such and that we not get in a fight as to what we may have done," McCarthy said.

While characterizing the issues raised by the State Lottery in a Feb. 3 letter to the OTB board as "procedural" and "administrative," he said the board is taking the warning very seriously and will react accordingly.

He stressed that there are no allegations of criminality or missing money.

Before the board went into closed session, McCarthy said a private meeting was necessary in order to discuss possible litigation.

After the meeting, McCarthy said there is no plan to get involved in a lawsuit, but given the nature of the enforcement action, the possibility of a hearing and the need to preserve attorney-client privilege, he thought the private session was necessary.

"We chose not to be pugnacious," McCarthy said. "We chose to try and work with the Lottery. We take the Lottery very seriously. The determination by the board was, 'let's find the best way to keep peace.' The best way to keep the peace is to go hat in hand to the Lottery. There is no benefit to be achieved by being litigious, but nevertheless, that option, as it obviously must, was considered."

McCarthy noted that Batavia Downs has provided $75 million in revenue for state schools since it opened with VLTs (slot machines) in May 2005. The Downs also provides a good deal of revenue to local government agencies.

He said the board will do what's necessary to maintain that cash flow.

"If they (board members) want to characterize it as going to the woodshed, they may very well characterize it as such," McCarthy said.

The board agreed to send a four-person delegation to Schenectady to meet with Lottery officials in order to find a solution to the threat of closure.

Among the Lottery's requests is that the Downs hire a consultant to help put the procedural and administrative issues back in order. McCarthy did not say so explicitly, but the tone and tenor of his remarks indicate a willingness to follow that advice.

The members of the delegation will be Paul Lattimore, from Cayuga County, Richard Bianchi, Monroe, Richard Siebert, Genesee and Marcia Touhey, Orleans.

Previously:

• State Lottery threatening Batavia Downs over management issues
• Batavia Downs pledges to work with regulators to address concerns

In response to reports that the State Lottery is threatening to remove Batavia Downs video lottery terminals,  Joseph Gallo, chairman of the Western Regional Off-Track Betting Corporation, has issued the following statement:

Western Regional Off-Track Betting pledges to work with the New York State Lottery over concerns regarding the performance of Batavia Downs Casino. As part of our formal response, a special meeting of the Western Regional OTB Board of Directors has been called for Thursday, February 11, 2010. The meeting is scheduled to begin at 11 o'clock AM inside conference facilities located at Batavia Downs Casino. At that time, the Board will discuss elements of a comprehensive management improvement plan being requested by State regulators.

The State Lottery is threatening to yank video lottery terminals from Batavia Downs Casino over management issues, the D&C reports.

The D&C story lists four areas of concern:

• debt transactions without Lottery approval
• not providing minutes of board meetings
• not submitting salary reports
• discrepancies over capital expenses

The D&C reports that Western OTB President Martin Basinait declined comment on the State Lottery letter.

Walk into Batavia Downs and you don't necessarily hear the cash register ringing, but you can certainly hear the cha-ching of video gaming.

And it's a good thing. It turns out that harness racing may be fun to watch, but it isn't profitable for the race track.

The historic facility is again projecting a loss for living racing, but will more than make up for it off of slot machines.

"I think everybody in the harness racing industry statewide understands that without video gaming, harness racing would no longer be in existence," Michael Kane, vice-president of Western OTB, told WBTA (mp3). "You need harness racing to have video gaming. It's a cost of doing business."

Kane added, though, that Western OTB works very hard to reduce its losses in racing.

Harness racing is expected to lose $1.3 million dollars, but overall Western OTB is projected to turn $5 millions in profits, thanks to those dinging, donging, clanging, light-flashing machines on the second floor of the Down's building.