The state of New York is having problems with its racing industry. Right now the closing of the state’s Off Track Betting Corp was huge news. It is the biggest racing company in the state and one of the largest betting operations in the US. Its closing is perhaps a sign of where the gaming industry is going in the future. Officials of the state are looking for ways to turn things around for the industry. One of the problems though is that racing doesn’t seem to be attracting customers. The lack of patrons is making it more and more difficult to bring in bigger purses that surely would draw them in. It’s cyclical and legislators are having a problem coming up with a solution. One of their initial goals was to get slots games into all of the race tracks within the state. They were hoping that having a good slots parlor around would cause gamers to revisit tracks. They may or may not start wagering on races, but the revenue would still be there to work with. Slots are lucrative and a good draw for people.

There are other potential solutions on the table for New York though. Some legislators believe that a merging of the market would work. They want to bring all race tracks together to make it one entity in the US. This would work if the participants were all willing and some have made it clear that they aren’t. A conglomeration of the market may not work if all parties aren’t on board even at the beginning. There are different size race tracks out there and larger ones may not want to carry smaller ones. Smaller ones may not want to share their revenue with big ones. It still is a problem that needs to be sorted out. Another solution on the table is to bring OTB to mobile devices, thus opening up the mobile market to the gambling activity. This still is dependent on having a market that wants to wager on races so badly that they are willing to work with their mobile phone while on the go. That has yet to be seen. There is still research being done on a viable solution and it will take time to pick out the best one, and then make it happen.

There have been a lot of problems with sorting out gambling and tribally-owned casinos in the world today. Right now the state of New York is having problems with the Seneca Tribal leaders regarding a “breach of contract.” The state is claiming that the tribe stopped paying them a portion of their payouts and is refusing to return to their old agreement. The Tribal Leaders were given the authority to run their slots parlor in the state with the agreement to give a percentage of all earnings back to the state. Now that the Tribal Leaders are refusing to do this, the state is asking for legal help with a third-part arbitrator. The Patterson administration has stated they have done everything possible to rectify the situation with the tribe, but are finding no easy solution to the issue. Not only are they asking the tribe to resume payment, but also to pay for back pay owed to the state. The issue is a deep on though because the administration is also claiming that the tribe is unhappy that their no-tax on cigarettes law is coming to an end. Legislators in the state believe that this is the reason why the tribal leaders are voicing their displeasure in this way by crossing both issues with each other.

The tribe has another side to the story through. They state that they have tried time and again to work with the state regarding the slot machine contract that was drawn up. They however were upset when New York legislators allowed other slots parlors and slots operators to start running in their territory. This is what set them off and caused them to stop paying—they were not being heard. The leaders of Seneca Tribe state that they had the right to exclusivity within the state borders regarding slots. When that was initially breached, they tried voicing their old compact but were denied. As a last ditch effort to be heard the community decided to stop paying their portion of slots revenue to the state. If the arbitrator sides with the state of New York, it could cause the Seneca tribe to have to close their slots parlor immediately and not allow them to reopen until changes are made in operations.

Racing is in trouble. Since the recession people have cut back drastically on wagering, and almost completely eliminated wagering at race tracks from their budgets. This has created a huge problem for the racing market. Racing owners are worried that they have few options when it comes to reviving their market. The one thing they want to use is slots gaming, but that is in the hands of individual legislators who govern various jurisdictions where the race tracks are situated. Now there is more bad news for the industry of racing. New York’s Off-Track Betting Corp announced that it is closing down operations. The state and its owners have decided mutually that it is a time to close off the tracks. They plan on reassessing what happened with the race tracks and how to keep things moving in the future.

Although the race track company is shutting its doors, this doesn’t mean that state officials have not been debating out the what to do in the future. In fact, they are coming up with new plans for bringing more gambling into the market. One plan prior to shutting down was to expand games to the night-time hours. This was quickly pulled off the table due to the problems it would introduce to the market. Not only would it create problems with crime, but it would create a noise problem for nightime area residents. They would have to get used to the traffic and noise issues from the privacy of their own homes. This could cause more problems than the change would be worth. Plus, the question of whether or not people would wager at a race track at night during the work week was also debated. Many legislators believe that this is a down time for most race track wagerers and visitors and holding night races would most likely just be an added expense for the gaming companies to get through. So far the wagering at the race track world is up in the air. It may take some time for things to change, but it isn’t going to settle itself soon. It could be that racing is a dinosaur in the world of gambling and could be on its way out for good.

There are still a lot of rules to sort out with slot machine laws throughout the US. In New York, new problems are arising. Now it is the Seneca Nation of Indians that are beginning to fight over casino gaming fees being incurred. The tribe states that they are being charged large fees for gaming but should not be. Their suggestion was to pay out those fees to the local community, rather than paying them directly to the state. The Governor has rejected that suggestion, stating that they have to rather focus on the state pay. Governor Paterson said “This is not how New York State government works.” The Seneca Nation has long had issues with the Buffalo, New York area. They are trying to still come up with a better way to bring gambling to the state. The tribally-owned casino operators know that they are bringing in huge dollars but are taking offense at the amount of money that is considered to be “state regulated fees.” The fees are adding up to a much larger chunk of what was earlier decided upon. The Seneca Nation believes that they are being overcharged for the gambling services.

Indian-owned casinos are in the battle for their position in the gambling market. now that more and more casinos are opening in areas, the market of casino gambling is no longer solely a tribal issue. There is so much competition now that it is putting Indian-owned casinos at bay. They have to solidify their own positions in the market. Plus with the addition of online gambling companies the market is being pushed to a competition that until now has never been reached. Most Indian-owned casinos make that their only form of revenue and that alone is posing problems for their future financial progressions. Many are coming up with promotions and benefits for gamers in their areas hoping that is enough to sway them into their doors. It is working, but the competition is fierce and showing no signs of a cut back any time soon. Only time will tell how casinos owned by Indian tribes are going to fair in the future of gambling.

One of the biggest problems with the racing industry has been the overwhelming drop in customers. Since the recession, race tracks have seen drastic lows. Many have had to file bankruptcy and close down, while others have had to lay off workers. It has been difficult for them to survive and a lot of racing companies have employed slots as a means of reinvigorating their businesses. Aqueduct Race Track in New York has suffered and has long been pining for slots to enter their business model. They know that slots can bring them the huge revenue jump they need to survive. This past month the race track finally received part of its financial goal and that is great news for operators.

New York just received a 380 million-dollar payment from Genting Malaysia. This is huge for the state that has long been suffering financially. Things have not been easy on the economy since the recession and the Aqueduct was all but considered closed. Now this payment is the beginning of good things to come according to operators. Originally the amount was to be $380 million, but there was a surprise additional $80 million attached to the payment. Genting Malaysia has been expanding lately as the industry is moving forward. Asia is a hugely-populated country and gambling is growing in popularity. It is one of the huge markets that is fueling the Malaysian and Macau markets. Due to the funding of the Aqueduct Race Track, New York is set to receive more than $250 million in tax revenue annually. That is a huge amount that should bring tons of gaming revenue to the state and allow them to fund various programs that formerly were considered impossible to carry out. Due to the additional money, the casino is expected to continue expanding. Their first order of business is to bring in 2,000 more slots machines to the casino floor. Expect that to happen over the next three months and expect the casino to become one of the biggest in the market of gambling. It may take time to revive, but the Aqueduct Race Track is well on its way to turning itself around and this latest payment proves it.

New York has long been trying to bring in slots gaming to the area. It has been a long road due to changes with developers and financing. The question of bringing in gambling to any location is a hot topic now a days. The reality is that gambling offers a huge potential payout to any city that takes the chance of bringing it in. There are billions of dollars to be had with gambling and no one wants to pass that up. Though there are a lot of issues to bringing it in, many legislators are willing to sort through the red tape to come up with viable solutions for bringing gambling into their jurisdictions. They know how lucrative gaming is and how much revenue it has brought into other areas over the years. Plus, the market is hot. Every month thousands of new gamers enter the market and that means millions of additional dollars are coming in. Why shouldn’t every city take advantage of that?

Now New York announced that the Aqueduct race track may be the next location that benefits from the highly lucrative slots games. The contract has finally gotten the approval to move forward. The state comptroller just came out with final approval for the project to move forward. Thomas DiNapoli is the state comptroller and he is giving the go-ahead to Genting New York LLC to start building the facility that will open in Queens. The Aqueduct is a race track that has gained a lot of notoriety over the years. It used to be a huge money maker, but during the recession it lost a lot of that bargaining power due to lower numbers. Without a viable solution, it faced closing like many other race tracks throughout the country. Numbers were down due to the fact that people just didn’t have the funds to continue gambling. Initially the play is to bring in 1,600 slot machines within the first six months of operations. The hope is that the slots games will help to turn around the financial woes the race track will go through. Time will tell how lucrative the gambling addition will be to the race track.

The New York Division of Lottery came down on operators of the Batavia Downs. The operators have come under criticism due to questionable accounting issues that track their slot machine revenues and gaming.  One of the offshoots of increased gambling is that it opens the door for a wide range of crimes that span from money laundering, theft, identity theft and other illegal activities. Many opponents to increased gambling are citing the changes that it could potentially bring as negative entrants into society. Without the proper watchdog systems, it will be difficult to manage an increase in illegal activities. In addition, it will be difficult to protect the most vulnerable- the underage and the elderly. They need to have services that protect them from predatory gambling companies.

Now, Batavia Downs have appointed a third-party watchdog system to help their accounting process. Western Regional Off-Track Betting Corporation has motioned that Ernst & Young, LLP is the said company to police accounting practices carried out by Batavia Downs. The company will be retained to manage finances for the casino and its slots play. It also will have to help solve problems that the casino has in keeping track of slot machine accounting procedures. It may take time to regulate, but the Western Regional Off-track Betting Corporation operators believe that Ernst & Young, LLP is the company that can offer the necessary procedures to regulate the casino’s procedures. It is a necessary move as the US moves closer to legalizaiton and regulation of online gambling.

The call for a watchdog service brought many different companies into the mix. There were eight groups who made a bid for the job. Ernst & Young’s big for $70,000 was accepted by the casino and soon will begin. It’s just the first move to regulate gaming within the state. Most states are moving towards the same thing- finding ways to regulate and manage gaming. The rules have not yet been written to manage the industry. Due to gaming being relatively new to the market, and its legalization coming up shortly and inevitably, laws need to be put into place to protect gamers. Expect the future to bring more changes and more solid rules and regulations for US gamblers.

The NYRA is quoted as saying that they are having a difficult time bringing slot machine in at Aqueduct Racetrack. They say that if the slot machines are not able to run at the location, they may have to cancel racing completely due to lack of funds. Although it may prove difficult for them to run their racetracks, industry insiders are saying that the NYRA is guilty of blackmail. Mara Jensen, gambling analyst, said, “It’s obvious what they are doing…they want slots, don’t yet have the approval and are pushing the state up against the wall to get what they want. It’s a scare tactic and the state can’t bow to it.”

The NYRA disagrees. Charles Hayward, spokesman for the racetrack, said that the race will not be able to go on as planned if they don’t have additional slot machine. The ones they currently have running are not enough to bring in the funds they need to keep up the third leg of the Triple Crown, which has been run every year for the past 104 years. Although that was the first release from the NYRA, Hayward did a recant saying that the organization would be offering the race with or without the slots additions but they wanted to convey to the market that if they were not allowed the slots, their future is in a difficult financial situation. Experts believe that the racetrack will run based on the revenues it bring in and regardless of changes on the slots floor, it will keep operating as it always had.

Only time will tell whether or not the state will approve the slots and if that is the answer to funding the NYRA will need to remain solvent in the market. Racing has taken a lot of blows since the beginning of the recession and slots are looked at as a sure-fire savior to their operations. Without the additional slots, the racetrack could potentially continue running, but at low capacity and with a highly-strapped budget. Future cut backs could prove critical to the racetracks survival in 2010. Hopefully slots will spur the market and bring people into the racetracks once again.

Recently New York offered their Racing Association the approval to keep running. The problem happened pre-recession. Racetracks saw huge declines in numbers as the economy began its downturn. The biggest problem with the racetracks was the same as with retail outlets—people stopped spending. The housing crash along with the car manufacturer crash created a volatile market. Add to that that the business world began cutting jobs notably. It’s estimated that the economy lost millions of jobs and that created a huge unemployment rate. The result of the recession was that people cut their discretionary spending and that included racetracks. Marley Benton, manager of a racetrack in New York, said, “We are definitely last in line when it comes to spending…people cut back on groceries, but have to buy them. Betting at racetracks is the last thing on people’s mind when they are worried about making their mortgage payments.”

Due to the problems with racetracks, the New York Racing Association, NYRA, was left with huge deficits and it was questioned whether or not the market would remain altogether. The state decided that the NYRA should be allowed to continue running their industry, rather than bringing some one in to help them manage. Now, that decision is in question. The organization is threatening to cancel the Belmont Stakes if they don’t get slot machine approval.

It’s a tactic that many racetracks around the country are using. They are requesting the approval to turn into “racinos”, a racetrack with slot machine casino combination. The added gambling offering has managed to spur racetracks back into financial viability within the market. Slot machines have proven to be the most reliable gambling games on the market. Las Vegas knows all too well the power of the slot machine. It reported that in previous years about 60% of their total revenues came in due to the slots parlor. In the recession, slots had the flexibility to remain low-price ways to gamble. High-stakes tables suffered, but the penny-slots never did. Penny slots have remained stable in revenues throughout the pre-recession, recession and post-recessionary times.

Part two coming next.

The Wynn Resorts company is a luxury casino located in Paradise, Nevada. Named after casino mogul Steve Wynn, the $2.6 billion resort covers about 210 acres of the city.  If you visit the Wynn, you’ll be pleasantly surprised by the huge amount of amenities available. There are 2,716 rooms that range from the small 640 square foot rooms to the 7,000 square foot villas. You’ll also find a 111,000 square foot casino, huge amounts of retail space and a convention center that rivals other centers from around the world.

Despite its opulence and grandeur, the Wynn recently decided not to complete a bid for slot machine lincensing in New York. The company surprised industry insiders by making the decision. They were formerly requesting rights to run the slot machines at New York’s famous Aqueduct Racetrack. It is pretty common for racetracks to be looking for slot parlor additions in an effort to increase revenues. The recession has caused many racetracks to close down, file bankruptcy or struggle financially. Slots parlors have been a clear savior for many racetracks in the US and having a successful company like The Wynn run them seemed to be a sure-fire way for the Aqueduct Racetrack to turn its finances around for the better.

The Wynn just released their financial papers and a healthy financial position showed. Despite their success in the market, the company decided to withdraw their bid for running the slots parlor in New York. If they did have the bid, the company would have been benefiting from 4,000 new slots in the New York facility. No one knows what the true reason for withdrawing their bid was, but one thing is for sure: the Wynn is staying out of the game of slot machines from now on. The company announced that after their withdrawal.

Although the Wynn is no longer a contender for running the slots at Aqueduct Racetrack, both Penn National and MGM Mirage are. The two companies are vying for the position and the Governor of the state is expected to announce a winner shortly. Only time will tell which company wins the bid and if the Wynn made a mistake by withdrawing their prematurely.