Western Regional Off-Track Betting Corp.

Batavia Downs is betting on experience and an increased commitment to racing as it promotes longtime employee Nicolle Fortes to director of live racing and moves forward with track improvements.

“Nicolle Fortes, who has been with the Corporation for 31 years and is currently director of intertrack wagering, has been selected for the position of director of live racing,” said Byron Brown, president and CEO of Western Regional Off-Track Betting Corp.

Fortes, a Batavia resident, replaces Don Hoover, who retired.

The Western OTB board approved Fortes’ promotion to grade seven pay level, which keeps her $102,000 annual salary consistent with the prior director's salary, who was part-time. Fortes will be on the job 12 months a year. 

There is a long-term trend, even at the national level, in live-race attendance and wagering, Brown said. He hopes Fortes can invigorate the experience at Batavia Downs.

 “As you know, racing, harness racing, and thoroughbred racing have been down nationally, and we want to place more focus on it strategically, to bring more people into enjoying racing,” Brown said.

Brown acknowledged that maintaining a racing operation is required for the casino’s license, even as the industry faces a decline in popularity. 

“We are required to have our casino operation. We’re required to continue our racing operation, which is one of the priorities of New York State -- to support the racing industry. So we are leaning into that. We’re going to provide more focus and resources to that element of our business, and we are hopeful that we will see increased patronage, more customers coming in and enjoying racing,” Brown said.

Brown described Fortes as “a very hard worker, very knowledgeable about racing, someone who is well respected by her colleagues in the corporation and very well respected by our customers, and we are pleased to offer her this promotion.”

The board also authorized hiring Gary Wolf, a consultant with more than 30 years of experience, to oversee racetrack maintenance and training, and awarded Keeler Construction a $44,396 contract to resurface the track. 

“Having optimal track conditions is important to the horsemen, to the drivers, and certainly to the safety of the horses,” Brown said.

The Western New York Harness Horsemen’s Association will pay half Wolf's salary.

Brown said the changes are part of a broader strategy to boost interest in harness racing at Batavia Downs. 

Track resurfacing and consultant services are scheduled to begin before the new season and the Night of Champions event. 

Assembly Majority Leader Crystal Peoples-Stokes said Friday that a newly approved tax reduction for the Western Regional Off-Track Betting Corp. will directly benefit OTB employees and communities across Western New York.

Speaking at a press conference at Batavia Downs, Peoples-Stokes said, “I assure you, both the elected representatives as well as the board members, that in Albany, we paid attention to what you asked for.” 

She called the $4.5 million annual tax cut, signed last week by Gov. Kathy Hochul, the result of persistent local advocacy and a commitment to workers.

“It’s really challenging when you’re working on a budget the size of the one that New York works on,” Peoples-Stokes said. “You can get right to the last day, and some things that you think were in there could come out because something else found its way in. That did not happen with this issue.”

Peoples-Stokes said the tax reduction will help Batavia Downs provide better wages and benefits for employees, improve entertainment for guests and increase distributions to the 17 member municipalities.

“I want to give God all the glory, because clearly that’s how I take my lead, and it’s been working for me my entire life,” she said.

She also credited Assembly Speaker Carl Heastie for supporting the measure, saying she personally lobbied him to keep the provision in the budget for Western New York. 

“The idea came from Western New York. So the idea should actually happen for Western New York in this budget,” Peoples-Stokes said.

About 50 Batavia Downs employees stood behind the speakers during the press conference, holding signs thanking the political leaders who helped secure the tax cut in the state budget.

Byron Brown, president and CEO of Western Regional Off-Track Betting Corp., said the tax cut will allow Batavia Downs to do “even more for all of you and our host communities,” estimating the change will provide $25 million over five years.

“Our dedicated employees and the 2.7 million residents in our 17 member municipalities will be the beneficiaries,” Brown said.

Dennis Bassett, chair of the board, said the measure is a step forward, but more work remains in Albany.

“There are issues that need to be addressed in Albany that haven’t been addressed until now, issues that must be addressed if Batavia Downs and the OTB are going to increase revenue and profits for the municipalities,” Bassett said. “We know that we can’t grow this business and be successful if we don’t look at how we can go into different ventures, and we can’t do the same things we’ve been doing tomorrow that we’re doing today and be successful.”

Rochelle Stein, chairwoman of the Genesee County Legislature and a board member, said the partnership between management and the board was critical to achieving the tax reduction.

“This is what happens when everyone pulls in the same direction for the good of our region,” Stein said. “It’s not just about Batavia Downs -- it’s about every community that benefits.”

Mo Sumbundu, Western New York regional director for Gov. Hochul’s office, praised the collaboration in order to benefit the municipalities and OTB employees.

“The tax rate reduction also allows Western New York Off Track betting employees, who are standing here with us today, to receive much-deserved pay raises, reducing costs for their families and also reducing their health care insurance costs,” Sumbundu said.

Antonella Rotilio, a representative of the United Public Service Employees Union, said the tax reduction is a win for the staff.

“Our members work hard every day to make Batavia Downs a success,” Rotilio said in a statement. “This tax relief means our voices were heard, and it will help us continue to provide for our families and support our communities. We appreciate the leadership that made this possible.”

Peoples-Stokes closed by urging Batavia Downs to “keep doing that great job of entertaining " and congratulating the board and staff on their work in securing the tax cut.

Genesee County will receive $61,096 as its share of a record distribution of profits for the first quarter by the Western Regional Off-Track Betting Corporation.

The distribution to all 17 municipalities that control the OTB for the first three months of 2025 is $2,864,269, breaking the previous record, set in 2023 of $2,269,956.

The distribution for the first quarter of 2024 was $2,003,522.

"We've been very creative in our marketing," said Byron Brown, president and CEO of WROTB. "We have been marketing to individuals who are large players in our advertising campaign. We've been able to reduce the cost of advertising while increasing the number of television spots that we receive and the quality of service that people receive when people come here -- the friendliness of the staff, and the quality of the restaurants, is keeping people coming back."

The Western Regional Off-Track Betting Corporation is taking on the IRS in tax court over an employee retention tax credit that is worth about $5 million to the corporation.

The Internal Revenue Service's position is that the OTB is a government agency and, therefore, not eligible for the pandemic-era tax credit.

"We are not supported by the government. We don't report to the government," said John Owens, OTB's acting legal counsel. "We've made the argument that there have been other matters in which we've been held not to be an agency, that we're not and that we should be entitled to (the tax credit)."

The board approved a resolution to hire Lippes Mathias LLP, a Buffalo law firm, and the only firm to bid on the project, to represent WROTB in tax court. The agreement authorizes an hourly payment up to $200,000 to handle the case and a $250,000 contingency fee if the firm wins the case.

The credit is available to eligible employers that paid qualified wages to some or all employees after March 12, 2020, and before Jan. 1, 2022. 

One of the arguments that Batavia Downs is a business is that the corporation received a PPP loan during the pandemic, which was a program not available to government agencies.

"We were determined to be eligible for that, and that was fully vetted," Owens said. "We had opinions of counsel, and everyone said, yes, we were eligible for the PPP."

About three weeks ago, a minor -- a person under 18 years of age -- was found on the gaming floor at Batavia Downs, a violation of state law.

Officials at Batavia Downs self-reported the violation. The result was a $10,000 fine.

Since that violation, all guests at Batavia Downs are being asked to present an ID to prove they're over 18 to enter the gaming floor.

"I think this was actually the third (violation)," said Byron Brown, president and CEO of Western Regional Off-Track Betting. "The first one was $1,000, I believe. The second one was $5,000, and the third one was $10,000. We took immediate action after each of these to make changes. But after the third one, we went to the ID and the all-visitor policy."

The new ID policy was approved by the New York State Gaming Commission.

Staff at the state's Gaming Association informed WROTB executives that there is a push to implement an ID requirement for casinos statewide.  The association's position is that requiring ID should be voluntary. 

"We have already implemented it," Brown told the board during Thursday's meeting. "It's going smoothly, and whichever way it goes with the state, we are ahead of the curve, and we are IDing all customers that come into the property, and hopefully that will put us in a position where we no longer incur any fines from minors being able to find their way onto the gaming floor."

ID is being required of all customers to ensure that no youth is able to "present" as older than 18, Brown said. There was initially some push back from regular customers but that has faded, Brown said, as IDing becomes the new normal.

"We don't want to give away our money that's being earned by being fined again," Brown said. "Our security does a good job. Sean and his team do a good job. So things are going very smoothly with that at this point."

The Western Regional Off-Track Betting Corporation is close to hiring a new chief financial officer, President and CEO Byron Brown said after Thursday's board meeting.

The search is necessary in order to replace CFO Jackie Leach, who is retiring.

Brown said the board authorized the use of a search firm that specializes in working with CFO candidates who have gaming experience. 

"So we've got additional resumes, including an internal candidate, and we hope to be able to make a selection in the very near future," Brown said.

The board is also looking to hire a new general counsel to replace Henry Wojtaszek, who served both as CEO and general counsel.

"We had a number of highly qualified resumes for general counsel," Brown said. "We did not have to utilize a search firm for the General Counsel. We are very close to selecting someone for general counsel."

Board President Dennis Bassett commended the board, particularly those members who have participated in search committees. 

It's been nearly 10 months since the board agreed to buy out Wojtaszek's contract, along with Leach's and that of VP of Operations William White.

"We will have brought on board a total of seven senior-level executives into this organization when we're finished with the chief financial officer and legal counsel, and there has been tremendous activity to make sure that we get a good cross section of those members that have agreed to serve on committees," Bassett said. "I think the process has gone very well, and I would like to thank each and every board member who has taken the time to participate in the selection process."

Western Regional Off-Track Betting Corp. and the union representing OTB branch employees have reached a new two-year bargaining agreement that will give the branch employees two 3% annual raises.

The OTB board approved the proposed contract on Thursday. The Public Service Employees Union local must also approve the agreement.

As part of the agreement, WROTB executives agreed not to close any branches during the first year of the agreement.

"That was a big concern with the branch employees. When we met with them, they were concerned about the future of the branches," said Steve Casey, chief of staff to the CEO.

Under the terms of the agreement, the union and OTB management will form a committee to investigate ways to cut costs, as some branches are losing money. 

The goal of the committee would be to "make sure we can achieve long-term stability," Casey said. 

Casey said negotiations for the new contract took about six months.

The PSEU also represents employees at Batavia Downs, and there are separate negotiations for a new bargaining agreement with them. In all, about 52 percent of the corporation's employees belong to the union.

"We had good discussions with the union and their labor representative, Antonella Rotilio," said Byron Brown, president and CEO of WROTB. 

A former chief operating officer for Western Region Off-Track Betting Corp. will receive $550,000 in a settlement stemming from a lawsuit he filed against the corporation in August 2021.

Michael Nolan alleged the victim of retaliation because he raised concerns about some corporation practices, such as health insurance for board members, the distribution of tickets to sporting events, misuse of funds, and improperly responding to Freedom of Information Law requests from reporters.

He was fired on Dec. 18, 2020.

In his initial filing of the suit, he sought $14.5 million --  $4.5 million for violating his First Amendment rights, another $4.5 million for breaking the state’s Civil Service Law, and an additional $5.5 million for emotional pain and suffering.

According to court documents, the case was settled through mediation on March 17 pending WROTB board approval.

Nolan began his career with WROTB in 2011 and was promoted to chief operating officer in 2017.

On Thursday, the board agreed to pay the settlement with $150,000 cash and an insurance policy covering the other $400,000.

Byron Brown, president and CEO of Western Regional Off-Track Betting, is optimistic that the corporation's lobbying efforts will lead to legislation that reduces the tax OTB pays to the state from 49% to 44%.

That would amount, at current cash flow, in an estimated $4.5 million in additional revenue, Brown said.

The language for adjustment will be part of the Assembly's version of the 2025-26 budget bill.  The Senate produces its own budget bill, and then the two chambers meet to negotiate a final budget bill.

"We feel good that we've done everything that we could do, that we got a good audience from the governor's office, the Assembly and the Senate, and we are hopeful that when the negotiations are concluded, that our requests will be part of the budget," Brown said.

The additional revenue will help the corporation on multiple fronts, Brown said, and those initiatives were part of the pitch to state legislators to approve the request.

"We explained that it was a matter of equity and fairness that would give us the ability to increase distributions to 17 member municipalities in Western New York, it would give us the ability to right size the salaries of our employees, and also to address the very high cost of family health care for our employees," Brown said.

Health insurance costs seem to be a top priority for OTB executives.

Currently, a family health insurance plan is $3,325 monthly for an OTB employee. If hired after Jan. 1, 2012, the employee contribution is 72 percent, or $2,394. Employees hired before that date pay only 5% of the premium.

The OTB would also be able to set aside some money to expand the hotel.

"(The hotel expansion project) projected to produce significantly more revenue for Western Regional off track betting Corporation, which would give us the ability to, again, not just increase our distributions to municipalities, but also increase the amount of money that we provide to the state of New York," Brown said.

In November, the board voted to delay a planned expansion of the hotel because of increased costs. The estimated cost provided by architects was $16 million and $16.5 million, which is about $4 million more than the original cost estimate.

The $4.5 million retained by OTB, if passed, is .0000018% of an anticipated $250 billion budget.

When board members of the Western Regional Off-Track Betting Corporation walked into the meeting room at Batavia Downs on Thursday morning, they found at their assigned seats a bit of a surprise.

There was a 13-page book containing 10 proposals to reform policies for the organization.

The booklet, said CEO Byron Brown, was the result of two months of work with his executive staff to identify areas of concern and propose suggestions for policy changes.

"We have been looking at concerns that have been expressed about the operation of Western Regional Off-Track Betting Corporation since I've been here as CEO," Brown said after a closed session meeting where most of his proposals were approved by the board. "We've done a top-to-bottom review so we can be more transparent as an organization, to look at ways to reduce expenses in the organization and drive greater profitability, and the reforms are around those items."

For the past few years, the OTB has been beset by a number of controversies, including how free tickets to sporting events are distributed, executive compensation and buyouts, health insurance, travel expenses, and management participation in tip distribution. 

The policy changes also address some less public issues, such as how raises are handled and the distribution of free play cards and gift cards.

Brown thinks if his new policies had been in place years ago, some of the public controversies could have been avoided.

"I have worked very closely with the board and the staff," Brown said. "The board was very open to looking at these issues and felt very positive that these reforms and these new policies will really strengthen the operation of Western Regional Off-track Betting Corporation."

The booklet also contained a bullet-point list of some of the reforms Brown has already initiated as the corporation's new CEO, such as tighter controls on how requests for sponsorships by area charities are handled and monthly reporting on advertising spending for broadcast.

Erie County rep pleased with reservations
The policy revisions were welcomed by Tim Callan, the Erie County representative on the board who has been perhaps the most persistent voice seeking reform since the board was reconstituted by the state Legislature more than a year ago.

"I'm very pleased with what Byron has done here," Callan said. "A couple of the items in the reform agenda -- about travel and changing the travel policy to get some things back under control there, changing and updating the procurement policy -- these were things that throughout last year I had been raising questions about. The sponsorship program, where the corporation gives sponsorships and donations to various groups, I've been raising a lot of questions about that. So to see that those three areas are being addressed by the new management team, I'm very happy to see that."

Callan, ever a stickler for details, does have concerns about how the reform package was brought to the board, and in the closed-door discussion (which he is also concerned about), he objected to two proposed policy proposals, which the board ultimately did not support.

Brown proposed reducing the cost of employee contract buyouts.

Some employees, including top executives, have contracts that stipulate how much severance they will receive if the contract is terminated early. 

In July 2024, the board of directors approved a buyout of former CEO Henry Wojtaszek's contract equal to one year salary, or $299,000. Outgoing CFO Jackie Leach's buyout was half her annual salary, or $122,000, and operations manager William White received $87,000.

Brown's report says that a review of contracts found there is no standard severance pay and benefits package for employees under contract. One employee, not named, has reached a settlement that allows that employee to work from home until November, earning until that time $174,907. 

Brown recommended capping severance to four months' salary. The board tabled the proposal and called for research on standard procedures in the gaming industry.

Callan said he opposes providing OTB employees with any severance pay, even though the practice is common in corporate America.

He said WROTB is not a private company. It's a public benefit corporation with a mission of generating revenue for the state and the 17 municipalities that control the corporation. As a quasi-state agency, employees are part of the state's generous pension system.

"That's something you folks in the private sector are not getting," Callan said. "You guys have to have 401(k)s, and Roth IRAs or whatever you do to help provide for yourselves in retirement. Well, folks here have that state pension ability separate from whatever saving they do on their own. So it's not an apples and oranges comparison for me to say, a private casino where, you know, they're not going to get a pension, and it's a private entity."

Wrapped into the contract buyout policy proposal was a proposal to address inequality in health insurance coverage for non-union employees.

Non-union employees hired before 2012 pay only 5% of their insurance premiums. Those hired after Jan. 1, 2012 pay 72% for a family plan (single plans remain 5%).

There are 38 employees who were hired before 2012 and 72 hired after the change policy.

In an interview, Callan disclosed that the monthly premiums for Batavia Downs employees are significantly higher than typical for group insurance policies. 

Human Resources Director Danielle Fleming later confirmed that a family health insurance plan is $3,325 monthly. The employee contribution, if hired after Jan. 1, 2012, is 72 percent, or $2,394.

Brown's proposal, which has not yet been approved, is to find a way to close the gap between the two groups of employees and set the employee-share of future management hires at 20%. Currently, seven members of management staff pay a 20% share of their premiums.

"It's obviously incredibly expensive for the employee. It's obviously also incredibly expensive for the corporation, where the corporation to bear the expense," Callan said. "I loudly expressed my objection to that in the executive session and said that I would not vote for it. And I thought that needed further discussion. When we have members of the management team make $190,000 or more, and persons in the mid-$100,000s, to send a message and say to them and say, "Okay, you only have to pay 20% of the cost of health insurance,' but somebody here that makes $17.50 an hour has to pay 72%, that, to me, is not right, and so the management team, after some members of the board objected and raised questions on that, agreed to pull it back, and I think we're gonna have some further discussions on that topic next month."

Callan said that while overall, he is pleased with the policy changes, especially since several of them are responsive to issues he's raised over the past 13 months, he thought it was a violation of the open meeting law not to have the agenda explicitly state that the board would do more on Thursday than engage only in a general policy discussion, but actually have written policy changes to consider and vote on.

He also said it could be a violation of the open meeting law to have most of the discussion in closed session.

Asked about the exemption used under the state's Open Meeting Law, Brown said it was a personnel matter.

"There were a number of personnel items that were discussed, so that was the reason why the board went into executive session in that particular discussion, where we were discussing salaries, benefits for specific individuals," Brown said.

Callan said the only policy item that addressed specific people was the health insurance discussion, which involved seven individuals. Otherwise, the rest of the policy discussion did not touch on specific individuals. In his view, the policy discussion should have occurred in open session.

"We have a lot of discussions in committees, including an executive session, a lot of which I don't think should be an executive session under the law, but that's another story you and I have spoken about before," Callan said. "I don't think, in hindsight, it should have been an Executive Session."

Accountability and profitability
Among the policies highlighted by Brown in an interview were changes to how sports tickets are distributed and whether the OTB will continue to purchase a suite and tickets to Buffalo Bills games after the coming season.

When the Bills move into the stadium, it appears the cost of the suite will double, raising the annual cost to $200,000, which may not have the return on investment the OTB seeks.

Brown said Batavia Downs is negotiating with the Bills organization.

"We're looking at tightening the ticket policy, making sure that when we do provide tickets and benefits, those are going to our customers, and they're going to our customers in a way that generates more business for the corporation," Brown said. "We're looking at travel policy to tighten our policies on what we spend when people have to travel for business purposes, going to conferences, going to training. All of those things, I think, would have eliminated some of the issues that the corporation has faced in the past."

The ultimate goal, Brown said, is a corporation that is more efficient and more profitable.

"The agenda is about going forward, looking at issues with the board, with the staff, that we saw as concerns, things that we felt could be improved, ways that we could increase transparency, that we could increase profitability, reduce expenses," Brown said. "So, going forward, this will make the corporation stronger. This is a place where people love to come and, after expenses, generates over $90 million a year. We want to continue to produce that kind of revenue and grow the revenue."

The policy changes approved by the OTB board of directors:

Merit Raises: Over the past three years, 102 OTB employees have received merit raises for a total cost of $392,166. Merit raises are supposed to be approved by the board's personnel committee.  There is no documentation indicating these raises were approved by the personnel committee. There were 22 raises in 2022, 50 in 2023, 28 in 2024.  The average per year is $130,722. The new policy would budget $100,000 for merit raises.  Department heads would recommend merit raises, and if approved by the CEO, the request would go to the personnel committee for approval.  All raises would need to be submitted by July 1 of each year. One issue this policy will address is the appearance of favoritism. Five employees received merit raises in each of the past three years.

Video Record Board Meetings: Video recording all board meetings would be inexpensive and easy to accomplish, and multiple "good government" groups recommend it. Some of the municipalities represented on the OTB board are more than a two-hour drive from Batavia, making board attendance difficult for some interested parties. Recordings would be posted on the OTB website within 24 hours of the meeting.

Renewal of Buffalo Bills Suite: The current contract for the suite expires after the the coming season. The suite is considered a great marketing tool for Batavia Downs. The casino conducts drawings for tickets and also provides tickets to high rollers. However, the cost for suite in the new stadium will nearly double. During the past season, OTB paid $114,205 for 16 tickets per game. A new 12-person suite would cost $200,000 per year, with price increases of 5% per season. The return on investment would be low. The cost outweighs the benefits. OTB will try to negotiate a lower price suite.

Travel Policy: WROTB has been criticized for "extravagant" travel.  While the spending on travel for some executives exceeded state limits, and a public benefit corporation, WROTB, is exempt from those caps. The comptroller recommends OTB implement and enforce policies that are reasonable. The new policy would require a form to be completed that lists all anticipated expenses for both in-state and out-of-state travel. For in-state travel, the CEO would review and potentially approve the travel. For out-of-state travel, if the CEO recommends approval, the board of directors would be asked to approve the travel.

Transparency of Procurement: For procurement of goods and services, currently, no quotes are required for costs less than $5,000, for $5,000 to $10,000, documented verbal quotes from at least two vendors, for $10,000 to $15,000, written quotes from at least two vendors, and for more than $15,000 public bidding that is subject to board approval. There are also policies dealing with sole-source procurement and single-source procurement. The new policy would require bidding on services and purchases of $15,000 (which is less than the requirement of municipal law).  The reform also recommends a written policy for procuring goods an services that would clarify the difference and use of sole source and single source vendors.

Job Postings: An average of 73 jobs are posted annually, and most are posted internally. Jobs are posted on bulletin boards and if external candidates are sought, on social media. Under the reform, the process for applying through the OTB's website will be improved and all publicly advertised positions will be consistently posted on social media with a link to the Batavia Downs application page. 

Tipping Policy: Batavia Downs does not currently have a tip-pooling policy, which can lead to operational, legal, and employee-related issues. The approved reform is to write a uniform tipping policy for the facility, including who is eligible to receive a portion of the tip pool, as well as policy for distribution and reporting tips for tax purposes. Supervisors will no longer receive a portion of the mandatory 20 percent tip for booked events.

Free Play Policy: The new policy will standardize free play coupons that an authorized person will sign. Upon redemption, a note will be made in the computer on who authorized the free play. This will assist in auditing free play.  After March 15, only free play coupons created under the new policy will be honored.

Gift Card Tracking: Grocery and gas gift cards are used as an incentive for booking hotel rooms. In 2024, Batavia Downs purchased $160,000 in gift card, at $20 each. The gift cards were tabulated into the cost of rooms, so there was no additional cost to the corporation. Other gift cards can sometimes provided to the hotel for hotel packages or requested by officers or department heads to reward staff members for work done above and beyond their duties. Gift cards are logged but there is no standard approval process. Under the new policy, officers and department heads will complete a request form that will require approval by the chief administrative officer. A record will be maintained of gift cards requested by officers and department heads for future auditing purposes.

Download PDF: WROTB 2025 Reform Agenda.

Western Regional Off-Track Betting was informed on Monday that the office of NYS Comptroller Thomas Dinapoli is conducting a financial audit of the corporation, according to a statement issued to The Batavian on Wednesday.

Jennifer Freeman, communication director for the comptroller's office said that the audit will start in February.

"It will take several months to complete," Freeman said. "During an audit, we do not comment on specifics or what we are finding."

Michael DeGeorge told The Batavian on Wednesday that the OTB was told that the audit could include a review of the past three to five years of financial operations, including internal controls.

"The president and CEO (Byron Brown) made it clear that the new management team will fully cooperate with the comptroller's office throughout the process and that we welcome outside review," DeGeorge said.

There has been recent controversy regarding executive buyouts, other perks, and executive-level expenditures as a result of the transition from the leadership of Henry Wojtaszek to Brown.

Previously: 

• Erie County's WROTB board member walks the line on agency's spending
• OTB approves consultants’ plan for executive reorganization, approves jobs for two former Brown staffers
• OTB chair vows to keep politics out of new CEO search, defends legality of severance pay for executives
• OTB board votes to buy out contracts of top three executives
• Wojtaszek confirms he's leaving OTB by mutual agreement
• WROTB board seeks accountability when it comes to sporting, entertainment events in Buffalo, Rochester
• For additional coverage of OTB, click here.

During his years in Congress, former Texas representative Ron Paul, a medical doctor by trade, gained the nickname "Dr. No" for his propensity to vote against nearly every bill that came before him.

Might the Western Regional Off-Track Betting board of directors have its own "Dr. No"?

Erie County's representative, Timothy Callan, does have a Ph.D, but, in fairness, he more often than not votes yes on board motions. When he does vote no, though, he is typically the lone dissenting voice on a board that, though made up of Republicans and Democrats from large and small jurisdictions, often hues toward unanimity. 

When Callan, deputy comptroller for Erie County, votes no, the motion before him typically deals with financial expenditures.

That was the case Thursday when Callan voted against motions authorizing the OTB to hire a temporary general counsel while the board seeks a new staff attorney and voted against authorizing expenditures for advertising on Buffalo and Rochester broadcast media. He also voted against a $10,000 pay raise for the executive office manager, an apparent correction to her employment agreement. 

Callan said he is concerned about the seeming rise in payroll for executives at OTB.  He raised concerns in October when he voted against a reorganization plan that, as he sees it, created three new jobs. He's more concerned now, he said, because of current financial trends.

Last month, The Batavian reported that OTB was on track to return less revenue for 2024 to the 17 owner-municipalities than in recent years even while revenue has increased. 

"I think that we should be much more judicious about our spending," Callan told The Batavian after Thursday's board meeting.

In July, the OTB board voted to buyout the contracts of CEO Henry Wojtaszek, CFO Jackie Leach, and VP of Operations William White.

Wojtaszek earned $299,000; Leach, $244,000; and White, $160,000 (Leach's contract was amended on Thursday to extend her employment with OTB a short time to help with the ongoing transition in her department). 

Former Buffalo mayor Byron Brown replaced Wojtaszek as CEO in October at a salary of $295,000. 

In October, the OTB board reorganized the executive staff, creating a chief of staff position and a director of communications position. Steve Casey was hired as chief of staff at a salary of $190,000 and Michael DeGeorge became the director of communications at an annual salary of $130,000.

Ryan Hasenauer, former marketing director, was promoted to the new position of VP/Business Development and Danielle Fleming was named VP/Human Resources as part of the reorganization.

What the reorganization plan didn't address was the need to replace Wojtaszek in his secondary role as the agency's general counsel, a position he held before taking on the primary role of CEO.

Callan said he learned for the first time on Wednesday that Brown intended to hire a staff attorney with an anticipated salary of $160,000 to $180,000 annually, plus benefits.

"I was under the impression and led to believe that Judge (John) Owens was hired as an external vendor -- he's not an employee of the corporation, but he has been serving as legal counsel for the Corporation since May or April of 2023," Callan said. "I've interacted with him last year, when I joined the board last January, and found him to be very reasonable and competent."

Callan said he is under the impression that the retainer fee for the firm that employs Owens is being increased by $25,000, but at the same time, OTB, Callan said, is paying out "hundreds of thousands of dollars" for outside counsel on a variety of legal issues facing the agency. 

While Callan believes executive salary expenditures are up significantly, Brown told The Batavian in a separate interview on Thursday that "it's a wash from what it was previously."

"When you look at the top executive positions, there is no material difference in the spending," Brown said. "With the legal counsel, we were outsourcing a lot of that legal work previously, and my goal is to bring more of that work in-house and create a more competitive environment and how law firms are selected when we do have to outsource legal work."

Brown said he believes it is important for the corporation to have legal counsel on staff, available on a day-to-day basis.

"There are a lot of legal matters that come before the corporation all the time, and so for the corporation to operate more efficiently, for the corporation to save money on legal expenses, having an in-house counsel that is available daily, I think, will make the operation of the corporation even more efficient," Brown said.

Callan was appointed to the board as a result of legislation pushed by Democratic Sen. Timothy Kennedy, representing Erie County, making spurious claims about corruption at the agency, to fire all of the board members serving in 2023 and giving the larger jurisdictions among the 17 owner-municipalities greater weighted voting. This g was expected to shift the controlling interest of the corporation away from Republicans and to Democrats.

Wojtaszek is a Republican and often the target of attacks by Erie and Niagara county politicians. 

In relation to Callan's assertion that executive expenses are going up in the wake of Wojtaszek from the agency, The Batavian asked Callan about the apparent "unintended consequences" of "pushing out" Wojtaszek.

Callan said he was as surprised as anybody when he learned before the July board meeting that Wojtaszek was seeking a buyout of his contract.

"That was news to me," Callan said. "I've not heard anybody say Henry was pushed out. I don't know if Henry thinks he was pushed out, but everything I was told by Henry, by our chairman, and by other colleagues here is that Henry chose to leave and wanted a buyout. I wasn't told he was pushed out. So I don't know where that sentiment would come from."

Wojtaszek told The Batavian in June that his departure was by "mutual agreement."

As for advertising spending, the board approved the expenditure of up to $1,155,000 for advertising at 14 broadcast outlets in Rochester and Buffalo.

That doesn't mean OTB will spend that amount, just that marketing staff can make ad buys up to the amounts specified for each individual outlet, ranging on an individual outlet basis from $15,000 to $250,000.

Callan said he isn't convinced the corporation has a good metrics system to ensure each outlet delivers results.

He said that during the advertising committee meeting on Wednesday, he asked colleagues to cut the authorization in half, perhaps covering only six months.

"Let's, as a board, understand the analytics behind why you're paying this TV station this amount, why this TV station in Rochester is getting this amount," Callan said.

(Disclosure: Batavia Downs has been advertising with The Batavian for about a decade but never in the amounts disclosed in the resolutions approved by the board.)

Callan said he's previously raised the question in internal meetings but has never found the answers satisfactory.  He said he wants to know if an ad can be linked to betting, to meals, to track attendance, remote betting, or hotel stays.

"How do we track and know who these people are and how they came here? In other words, how do we know that a TV ad is running in Buffalo every five minutes -- it seems like -- I live in the Buffalo area -- and every five minutes on one of the TV stations I see a Batavia Downs ad," Callan said. "How do we know the effectiveness of this? How do you track people who watch Channel 2, the NBC station in Buffalo? What's the bang for the buck that -- you know, they're advertising the most, they are getting the most money in the resolution -- that's driving people to want to come here?"

Brown said Thursday's resolutions were based on an advertising budget that was passed as part of the operational plan in December. 

"I was able to share with board members that my management team and I have already reduced some of the marketing spending, but it's critically important to market Batavia Downs Gaming and Hotel to keep people coming to the property, using the property, being aware of the property, so that we can continue our success in this very competitive industry," Brown said.

As for analytics, Brown said he agrees with Callan that measuring results is important. 

"We want to analyze our spending," Brown said. "We want to be able to track the impact of our spending and make sure that we are spending money on the market and in other areas most intelligently and efficiently."

He said, in fact, there is already tracking in place.

"I think we have to do a better job of sharing that tracking and those analytics, and we will certainly do that," Brown said. "But already in the first part of this year, we've demonstrated to the board that we have reduced the amount of money we spend on marketing while still expanding our marketing reach."

First-year Western Regional Off-Track Betting CEO Byron Brown has a four-point legislative plan he's pursuing in Albany in his attempt to grow the business and generate more revenue for the 17 municipalities that own the organization.

The top priority is reducing OTB's tax rate from 49% to 44%. That five percentage point drop would increase revenue for Batavia Downs by $4.5 million.

"We propose to use that revenue to increase disbursements to the 17 member municipalities, which would certainly make 17 governments in Western New York financially stronger," Brown said. "We would also look to provide raises to our hard-working employees, and you know that would certainly go back into the economy of Western New York, and finally, our interest would be to reduce what our employees pay for their family health insurance."

The reduction would make the OTB's tax rate more equitable with Hamburg Gaming and Vernon Downs.

"This would not affect either of those operations," Brown said. "Of course, gaming is a very competitive industry. This would make us more competitive in the industry, and these revenues would go to 17 municipalities and to the employees who work here."

Brown noted that WROTB is unique in that it has 17 member-owners and distributes revenue to 17 municipalities. No other gaming operation in the state has as many stakeholders receiving revenue from the operation.

"Suffolk OTB, for example, has one municipality to which they provide resources," Brown said. "In our case, we have 17. So this has a positive financial impact on 17 different municipalities in Western New York. This is also the fifth largest employer, with roughly 420 employees, in Genesee County, and 52% of those employees are unionized employees."

Brown is also aiming at ensuring WROTB gets a piece of the action if iGaming is approved by the state, a project favored, Brown said, by the chair of the Senate Committee on Racing, Wagering, and Gaming.

iGaming means online gambling, which includes casino games, sports betting, and online poker.

There are statutes in New York that also require, besides the tax, OTBs to pay fees to the gaming commission.  Brown is seeking a reduction in those fees.

The fourth item on his legislative agenda is to extend the boundaries for WROTB's E-Z Bet machines. Right now, they can't be placed more than 40 miles away from the track. That leaves out portions of Erie County. 

These are the sort of issues board members expected Brown to tackle when they approved his employment contract.  As a former mayor and former state legislator, he has a lifetime of political connections in Albany.

But that doesn't mean winning support for these initiatives will be easy.

Annual budget planning starts in June, and Brown started his new position in October, so that's a challenge for Brown to overcome, but he's working at it, he said.

"We're a little behind where we would like to be in terms of our legislative agenda, but we have hit the ground running," Brown said. "I've been to Albany talking to state legislators and the governor's staff and others. You know, the last trip to Albany was just another step in that process. I attended the governor's State of the State speech. We requested a number of meetings with members of the Assembly and with the Governor's staff, and all of the meetings that we requested were granted. So we feel that we're being listened to, that we're being heard, and people have been very receptive to our concerns and our needs."

After The Batavian's Jan. 7 article about the opening of the winter racing season at Batavia Downs, one reader raised questions -- well-informed questions -- about just how well the winter meets are doing for the race track and casino.

On Thursday, Don Hoover, director of live racing for Western Regional Off-Track Betting, sat down with The Batavian to address the issues raised by the reader.

First, the history of the winter meet at Batavia Downs
The meet is in its third season. Before 2023, the race track in Buffalo hosted a three-month winter meet but the storms of 2022 distributed the season, causing several race-day cancelations. Buffalo decided to compress its racing schedule into a season that starts in March.

The horsemen are accustomed to year-round racing, and for many of them, their income stream depends on it, Hoover said.

"Now we're faced with the possibility of no racing in Western New York for three months," Hoover said. "That leads to the question of whether some would have to get out of the business. Would they ship to another racetrack and maybe stay there?"

The horseman's association approached management at Batavia Downs and proposed a January and February racing schedule, promising to cover any losses incurred by the track.

The horsemen promising the track wouldn't lose money on the races is a key point, Hoover stressed.

"We have a shared agreement that benefits both Batavia Downs and the local horsemen so that they can maintain their racing without much interruption and we can provide a venue for them without incurring any significant cost," Hoover said.

The agreement covers direct costs related to each race, not other ongoing operational costs, such as the salaries of permanent staff who might work during the events.

Is keeping winter racing a good business decision?
"I have personally wrestled with that question because it's not really in monetary terms, and the angst that it just brings about naturally due to the constant question of -- are you racing? Are you not racing? Are you racing? Are you not? Is it too cold? Is it a safe track? Those items are hard to wrestle with on a daily basis," Hoover said. "If we look at it as a pure business decision -- I guess, what we would have to do now since this is our third winter -- I guess what we would have to do now is sit down and get the food and beverage revenue and see if we can see a pattern. We know that we do more business on Mondays and Thursdays when we race because otherwise, the clubhouse wouldn't be open.

"The clubhouse is open. We have food specials. People come and attend the races there and eat and drink. So we would have to try to analyze exactly what we could put in dollars and cents as to what ancillary income we get derived specifically by racing in the winter."

What Hoover calls "ancillary income" doesn't count against direct racing expenses.

Even so, it can be hard to separate additional revenue on race days when Batavia Downs has other promotions going on throughout the winter, such as hotel specials, concerts, and group events, "all the things we do here as a corporation to drive people to the property." 

He does believe, he said, that racing does get extra people to the track, though attendance is much, much smaller than the regular meet.

"It's logical that we would get extra people to the property by holding racing," Hoover said. "They are people who are harness racing fans, and they wouldn't be here except for that fact."

Is there enough attendance to justify opening the clubhouse?

"It's a work in progress where we look to see how to do that without losing money,"  Hoover said. "We have one bartender. People order drinks. We've paired down what foods are available. It used to be that they could order food and it would be brought up to them. Now we just have specials for right there. So we've tried to look at all the numbers on it and come up with a specific plan where we won't lose money by having the clubhouse open."

Our reader thinks attendance would be better on another weekday than Monday, such as going to two days, perhaps Tuesday and Thursday or Wednesday and Friday.
"Well, Mondays happen to be our biggest handle day," Hoover said.

During the regular meet, the first post time is 6 p.m., giving people who work, especially in Rochester and Buffalo, time to get off work and make it to the track.

In winter, with lower attendance, it puts more of a strain on staff expense to have a later post time.  The 3 p.m. post time in the winter also eliminates going head-to-head against racing at Monticello.

"The staff doesn't have to go home and come back," Hoover said. "The staff doesn't have to accrue extraordinary overtime. It's not dark yet. We have the track crew still here. We don't have to send them home and bring them back in, so we thought the combination of all those things regarding staffing, overtime, and the time of day was beneficial for us to make that schedule for the three o'clock on Mondays and Thursdays."

Why is Monday your biggest handle day?
There is less competition on Mondays, Hoover said. That is primarily important for off-track betting.

For the live handle, there isn't much difference between Monday and Thursday.

Is it correct that the off-track handle generates about 2% in revenue for OTB and the live-track revenue is about 20%?

Yes and no, Hoover said. When you factor in BataviaBets.com, phone bets, and OTB's own branches, the off-track handle increases to about 2.6%.

What is the typical revenue for a winter race?
Hoover said it is currently about $7,500 to $8,000.  That doesn't include anything from food and beverage or what might be spent by race attendees on the casino floor.

Later on Thursday, The Batavian spoke with CEO Byron Brown, who said winter racing is important to the operation of OTB.

"Winter racing really helps to strengthen the relationship between Batavia Downs and the horsemen," Brown said. "Also, as we work to make this a premier entertainment destination in New York State, it's just another reason for people to come to Batavia Downs."

The 17 municipalities that co-own the Western Regional Off-Track Betting Corp. can expect a payout of $7.8 million in 2025, according to an operational for the new year approved by the board of directors on Thursday.

If the 2024 estimate of $7.4 million holds, that's a $400,000 increase, but it still falls far short of 2023's record of $10,255,058.

The plan projects a net gaming win of $90,495,000.

Of that, close to $45 million will be paid to state agencies by statute.

The total operating expenses for all operations will exceed $38.6 million. Batavia Downs will account for $33 million of these expenses. This is an increase of $1 million.

Net earnings (profits) from all operations are expected to exceed $8.8 million, with branches generating more than $500,000 in surcharge revenue, losing more than $1.5 million, leaving municipalities the anticipated $7.8 million payout.

Previously: Revenue is up at Batavia Downs but expenses, including wages and contract buyouts, cut into municipal profits

Branch operations continue to be a financial drain on the organization, with revenue steadily decreasing every year. 

The anticipated handle for branch operations is projected to be $38.8 million in 2025, down from the planned handle of $43.9 million in 2024. OTB will earn more than $8 million on commissions, with other revenues exceeding $1.8 million. Statutory payments will be more than $4.7 million. Operating expenses will grow by more than $100,000 to $5.6 million.

There are eight branches within WROTB, 28 EZ-Bets sites(including four expected to start in 2025), plus online and telephone wagering.

The plan calls for Batavia Downs to operate 939 gaming machines, with a win per terminal per day of $267.17 for a total net win of $90.5 million.

Food and beverage revenue is expected to exceed $5.6 million with operational earnings exceeding $1.1 million.

The Rockin' the Downs concert series will return in 2025 with eight concerts, including a promise of some bigger name acts. Projected revenue from all sales is expected to approach $1 million. Net earnings will be less than $100,000.  The plan does not project an increase in hotel and gaming revenue associated with the concerts.

Projected revenue for the hotel in 2025 is $2.9 million with a profit of $780,000.

At the track, between the summer-fall season and the winter season, there will be 71 racing dates. The anticipated handle is $968,200. 

Administrative costs is projected to exceed $8.2 million, an increase of $1 million. The increase is related to ongoing demand for new and upgraded computers and software, legal services, and retirement benefits (including one buyout), plus the increased cost in health insurance.

Health benefit plans will increase by 6.5%.

By several metrics, the business of Batavia Downs is growing.

Revenue is flowing in at a record pace. There are more customers, more bets placed, and more bookings at the hotel, but with added success comes added expense, which Western Regional Off-Track Betting Corp. board remembers and executives discussed on Wednesday during the Finance Committee meeting.

Both the casino and hotel have more employees, and with three executives taking buyouts, added expenses have severely reduced the revenue that will be shared with the 17 municipalities that co-own the WROTB.

Based on profits through October, WROTB is paying out $1,677,960 less than it did through October 2023. So far this year, net earnings available for distribution are $7,107,384, compared to $8,785,334 at this time last year.

"I was asked this question by an individual, 'Well, how does that make you feel, Jackie, that the distributions are down?,'" CFO Jackie Leach said during her report to the committee. "I said, "You know, there are reasons why they are down from 2023. One, the board approved a 4.5% wage adjustment for employees.' I've always stated that we're a customer-oriented organization, and your employees are your most valuable assets; 2023 was a banner year for the corporation. So, between the wage adjustments, we do have one leg of Henry's buyout that's included in the 2024 wages, that's the cost of doing business."

In July, the board voted 14-1 to renegotiate the contracts of CEO Henry Wojtaszek, CFO Jackie Leach, and VP of Operations William White to buy out the remaining years on their terms.

Wojtaszek, who earns $299,000, will receive a full year severance. Leach, with a salary of $222,000, and White, with a salary of $160,000, each get six months severance.  By the end of the year, Leach said she and Wojtaszek will receive their full payout, so it will accrue to 2024, for a total of $521,000. White will be paid in 2025.

As for employee expenses, in addition to the 4.5% raise for casino employees, the operation added more than 20 staff positions. Hotel employees received 50-cents an hour raises and the hotel, which is run by a management organization, also added staff.

"The hotel overall has had pretty good revenue," said Paul Bartow, representing Schuyler County. "I guess what you're saying is that we could do better. We need to produce more revenue to cover some of these expenses. If, in fact, it looks like the hotel is doing well, you're like, 'Oh, great,' but it's not doing well enough given these expenses, and these expenses, in some ways, have to be moved, I guess, checked with more revenue from the hotel."

Leach said that's correct.

"When your costs go up, then you've got to make some adjustments," she said.

Ryan Hasenauer, VP of business development, said he and his staff are working on booking more mid-week events in order to increase mid-week room bookings and Leach confirmed that management is looking at increasing room rates.

Total revenue so far this year for the hotel is $2,399,000, up from $2,306,000. Payroll increased from $761,000 to $881,000. Other expenses increased from $647,000 to $682,000.

The other expense cutting into revenue distribution, Leach said, is increased legal expenses.

"Am I concerned? No. I've always said this corporation has to keep reinventing itself because of the competition," Leach said. "We work within a very saturated, saturated market in Western New York."

By the numbers, October was a good month for Batavia Downs. The net video game win was $7,641,556, up over $500,000 from the previous October. The October distribution to municipalities was up by $1,381 ($41,532 compared to $40,151). 

In October, there were 98,676,000 credits played, up from 92,088,000 in 2023. The win per terminal increased from $253.28 to $266.27.

The casino contributed $3.7 million to the state's education fund.

Attendance at the track increased from 74,000 to 76,000.

The casino also saw an increase in food and bar sales. Total sales increased from $676,636 to $774,848. Less expenses, net sales was $526,214.

OTB branches continue to struggle. In October, revenue was down $22,000, at a total handle this October of $3,366,000.  Year-to-date revenue is $36,522,000, a decrease of $5,198,000 (There was a $1.6 million drop in revenue attributed to the closure of one branch).

Total revenue for October is $74,331,000, up $2.5 million compared to 2023.  Expenses also increased from $23,507,000 to $25,429,000.  Salaries increased $985,000, which is still $210,000 less than projected in the 2024 budget.

Besides salary, there has been, so far this year, an increase in expenses of $939,000.

Revenue help should be coming in 2025, Leach said, with new video lottery terminals added to the floor of Batavia Downs, approved by the state, and the anticipated approval of new EZBet machines for bars and restaurants in the region.

"I was assured by the Gaming Commission that the four EZBets that have been in the hopper -- some for a couple of years -- that we could include them in our 2025 plan because they will be approved by year-end, so we will see what happens there."

High construction costs and high interest rates have temporarily shelved plans to expand the Hotel at Batavia Downs.

The Western Regional Off-Track Betting Board of Directors voted on Thursday to temporarily "pause" expansion plans on the recommendation of outgoing CEO/President Henry Wojtaszek.

Wojtaszek said the executive team sought construction estimates for the proposed expansion and the estimates -- not bids -- came in at $16 million and $16.5 million, which is about $4 million more than the original cost estimate.

"Because of the high cost of the estimate to build a hotel and the high cost of borrowing, we recommended to the board that they delay their decision and come back and review (the proposal) in six months to a year," Wojtaszek.

The Hotel at Batavia Downs is currently an 84-room luxury facility that opened in 2016. It was originally constructed and operated by ADK Hospitality, a Buffalo-based company. It costs ADK $5.4 million to build the hotel. The OTB purchased the hotel in 2021 for $8 million.

Officials were looking at an expansion that would essentially double the size of the hotel, with a new wing added to the north side of the current hotel.

Byron Brown, the new CEO and president, said pausing expansion given the current construction market makes sense.

"The construction companies that reviewed this felt that costs in the construction industry are extremely high right now and that interest rates are high right now, and we should delay seeing if construction costs come back down and if interest rates go down," Brown said. "And, you know, one example of this is if you even look at reporting on the Bills new stadium project, construction expenses have ballooned by over $560 million over original estimates."

Asked about the possibility of new import tariffs, as promised by the incoming White House administration, raising the cost of construction, thus making the project even more expensive to pursue, Brown said, "That's why we made the recommendation to delay moving forward with the hotel expansion, so that we would give the board the opportunity, with the management team to look at these things and to look at the costs, and if costs come back in line, then we would be able to move forward. And if costs don't come back in line, that would be something that the board would need to consider."

The board, Wojtaszek said, will likely look at a scaled-down expansion (fewer new rooms) at its December meeting to see if it could be financially feasible. 

The board may also be asked to authorize construction BIDs to see if maybe they come in lower than the estimates, Brown said.

As he stepped into his new role as president and CEO, Bryon Brown noted that the hotel has helped contribute to revenue growth at Batavia Downs and he said he supported expansion.

"(The hotel) has led to this corporation becoming a lot more profitable," Brown told The Batavian in October. "So purchasing the hotel in the first place was a very good decision. From my perspective, just being able to evaluate this during the week that I've been here, I think expanding would be a good decision as well. But again, I don't want to try to speak for the board."

Brown said delaying expansions is a disappointment for all concerned.

"The management team and the board are all disappointed. I'm disappointed," Brown said. "You know, we did not anticipate the numbers being this high with the increase in construction costs and interest rates, but we have to make a sound business decision, and that's what we're doing by recommending that the hotel expansion be delayed at this time."

Shortly after the board of directors for the Western Regional Off-Track Betting Corp. approved Steve Casey as the first chief of staff at Batavia Downs on Thursday, his new boss, Byron Brown, reiterated that he had no involvement with Casey getting a job in marketing before Brown was named the new president and CEO of the corporation.

"I did not know he applied for a gaming license," Brown told a gaggle of reporters after Thursday's board meeting. "I did not know he was hired at Batavia Downs prior to me applying for the position.”

Casey's new position was created by an executive reorganization based on recommendations from consultants at True North. The board on Thursday approved a payment of $30,000 to True North for their consulting work.

Based on those recommendations, the board created a new executive organization with the following job titles:

• Chief Executive Officer 
• Chief Administrative Officer/Chief of Staff 
• Chief Operating Officer
• Chief Financial Officer
• Vice-President of Operations
• Vice-President of Business Development
• Vice-President of Human Resources
• Executive Office Manager
• Director of Communications
• Executive Business Administrator

The board eliminated the following job titles:

• Director of Marketing
• Director of Human Resources
• Executive Chef

In addition to Brown as CEO and Casey as Chief of Staff, Ryan Hasenaurer was promoted from marketing director to vice president of business development. Danielle 
Fleming was named VP of Human Resources. Michael J. DeGeorge, who handled communications in the office of Mayor Byron Brown, was named director of communications at a salary of $130,000.

Brown said that based on the reorganization plan, he recommended Casey and DeGeorge for their new positions, which the board approved. Erie County's representative on the board, Timothy Callan, voted against the reorganization measures.

A number of media outlets have mistakenly reported that Brown hired Casey. On Wednesday, outgoing CEO Henry Wojtaszek told The Batavian he hired Casey not long after Casey first contacted him about a job back in May, months before there was an announced plan to replace Wojtaszek. Wojtaszek told Casey he would need to get a gaming license, which he did. Casey started working in marketing at Batavia Downs before the board hired Brown to replace Wojtaszek.

In an exclusive interview with The Batavian on Thursday, Casey confirmed that series of events with some additional details.

At 58, Casey said he started thinking about his retirement and that perhaps he should try to get back into the state's retirement system. While he's never been close with Wojtaszek, he's known him cordially for years, so in May, he decided to give Wojtaszek a call.

Casey said, "I'm thinking, 'Okay, it might be time to get back in. Where would I like to do that?' I think you saw a bit of chaos in Erie County. So I'm thinking, 'Where would a good spot be to go?' I knew Henry. We weren't close, but Henry and I, over the years, crossed paths, and I know him pretty well, so I reached out to Henry. 'Hey, any openings? I'd like to get back in the pension system.'"

Getting a gaming license normally takes weeks. Casey's was approved in about a week. Casey wasn't ready to start that soon so he didn't start working at the casino until September.

One of the issues Erie County reporters have raised regarding Casey is a wire fraud conviction against his former consulting company, LSS Strategies, in 2021. That came after a five-year FBI investigation that resulted in a $69 fine. 

"That application was the most comprehensive document I've ever seen," Casey said. "I literally sat with my attorney, and together, we went through it, answering all the questions, disclosed everything we possibly could so they could then make a decision. And fortunately, they came back and said, there's nothing there.”

Casey said the Gaming Commission was "100% fully informed."

"The most important factor was Steve Casey, as an individual, I don't have a point on my driver's license. I don't have a misdemeanor. I don't have a felony. There's nothing against me as an individual,” he said.

Casey said he didn't learn that Brown was a potential candidate for the job until August or September.

"I've kept in touch with the mayor over the years since I left city government, but when I first came here, it was not based on whether the mayor would come here," Casey said. "He was still in the middle of his budget stuff in May. You're looking at April, May, June. So, my coming here solely had to do with me looking at opportunities for my pension and getting back into government."

Casey is excited, he said, to take on his new role at the OTB and is already impressed by the quality of the people he will be working with.

"I can tell you, I started at the bottom level here," Casey said. "I was seeing everybody on the floor, talking to all the employees here. They didn't know who I was. They didn't know my background. Extremely professional, incredible staff, very talented. 

I'll tell you one specific example," Casey added. "The CFO here. I've worked in Albany, in Albany for nine years and in government for 24 years. I've seen some of the best budget directors you've ever seen, from the speaker's budget director to the governor's budget director. Jackie Leach is by far one of the single most talented CFOs I've ever seen. She knows everything about this place, the institutional knowledge, and her ability to do what she does here. I mean, it's a top-notch staff, and I'm looking forward to working with such a talented staff."

Previously: Information provided by OTB leaders contradicts widely reported accounts of staff hiring at Batavia Downs

Steve Casey, former deputy mayor in Buffalo under Byron Brown, has been appointed chief of staff for Western Regional Off-Track Betting. 

The board approved creation of the position and hiring Casey as part of an executive restructuring plan. 

Casey applied for a job with OTB in May and obtained a part-time job.  He was deputy mayor under Brown, until 2015.  Brown was recently named CEO of OTB.  

Casey is receiving a one-year contract worth $190,000. 

Michael DeGeorge, also a former assistant to Brown, has been hired by the board as director of communication, at a salary of $130,000.

More TK

In an effort to fulfill his vow for “transparency,” newly hired CEO Byron Brown released copies of his employment contract with Western Regional Off-Track Betting Corporation to members of the press before committee meetings Wednesday, revealing his three-tiered salary increases, a four-month severance provision and other benefits of the job he began just a week ago at Batavia Downs.

The former Buffalo mayor’s annual six-figure base salary begins at $295,000 through 2025 and is set to jump to $305,000 on Jan. 1, 2026, and increase another $10,000 in 2027 to $315,000, “contingent upon continued growth and a satisfactory performance evaluation.” 

“Before I even signed the contract, I knew there was a lot of media interest in the contract. I had been informed that a number of members of the media had requested the contract and that the contract was FOILed. It was my understanding, through the corporation, that through FOIL, the contract would have been released on October 31, but I thought, you know, as we talk about transparency, it was important for me to release the contract today, my first board meeting,” Brown said. 

“You know, obviously, we are in something of a transition," he added. "Some of the decisions that are being discussed today, work that has been assembled today predated me, so as I transition in, I wanted to transition into the organization with transparency, and wanted to provide the contract to the media so that it could be seen and you could evaluate it."

Unlike former employees who have received year-long severance packages, Brown’s is cut off at four months, which was a condition he purposefully chose in working with Board Chairman Dennis Bassett, he said.

“We decided that I would not take that type of severance provision … Again, we thought that that was an important and meaningful reform with me coming in, and I was happy to agree with the chairman to reduce the severance that employees have previously enjoyed,” Brown said, answering why he agreed to a reduced severance length. “I want to start with transparency, want to start looking at potential reforms for the organization. Good work is being done here. This is a very profitable organization that delivers revenue to 17 municipalities in Western New York. I want to work to establish confidence in the organization. So I thought changing that provision and reducing the severance provision in the contract was important for me to do.”

The contract includes a minimum of two weeks paid vacation per year; an $800 monthly car allowance in lieu of any direct payments for expense of leasing or operation of a vehicle; and reimbursements for “necessary and reasonable business expenses incurred in the performance of his duties.”

Brown’s contract allows him to participate in employee benefit plans and programs, including but not limited to medical, retirement and life insurance, as are generally made available by the employer to employees.

The severance package also would include continued medical benefits or a $1,500 annual stipend for choosing not to use the medical benefits.  

His list of duties and responsibilities includes:

• The overall direction, development and day-to-day management of the employer — the gaming operations and hotel, food and beverage, and other gaming-related amenities; and management of vendors, consultants and employees, including the right to select, assign and terminate such individuals and entities and the implementation of personnel and wage and benefit policies established by the board;
• Preparation of annual operating and capital budgets of the employer and of required modifications to budgets, implementation, monitoring and evaluation of such budgets in the course of operations;
• Development and implementation of programs for training of employees and development of policies and procedures;
• Diligent attention to ensuring the compliance of operations with the requirement of the state Gaming Commission and other applicable laws relating to the integrity and operations of employers and maintenance of the integrity of all operations for the protection of the employers, its patrons and the public;
• Assistance in the development of strategic plans and preparation of related proformas for the expansion of the employer and of required modifications to such proformas;
• Overall direction, development and day-to-day management of the process to market, sell and account for the employer’s products and services and for developing, implementing, monitoring and adopting measures to improve customer service;
• Negotiate agreements on behalf of the employer consistent with the policies, and negotiate employment offers for management of the employer, both subject to board approval when required by employer policy;
• Lead the interaction with federal, state and local governments, including legislative bodies, and participate as the employer’s representative to the New York Gaming Association, and serve as trustee to the Employer’s Deferred Compensation Plan.

The annual salaries are listed as minimum base salaries, and will be up for review at the end of each fiscal year. The board may determine, in its sole discretion, to increase the executive’s base salary, the contract states. Brown is happy with the package, he said, which includes those "performance based incentives."

“I am certainly pleased with the contract the board has offered. We did not do a lot of negotiation, very little,” he said. “In fact, I was presented a contract for employment and found it certainly satisfactory to me and accepted it.”