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Long IslandColumnistsJoye Brown

Nassau video lottery terminal deal needs close scrutiny

Brunilda Garcia of the Bronx plays the slot

Brunilda Garcia of the Bronx plays the slot machines at the Resorts World Casino at Aqueduct Racetrack on Oct. 28, 2011, in Jamaica, Queens. Photo Credit: AP / Kathy Kmonicek

A news release out of Albany last week heralded an agreement between Nassau’s Regional Off Track Betting Corp. and Genting Group, which operates Resorts World Casino at Aqueduct. It said Nassau’s transfer of its authority to Genting to install up to 1,000 video-lottery terminals would bring “immediate, recurring revenue” to the fiscally stressed county.

Sounds like grand news.

But not so fast.

The revenue from Aqueduct would go straight to Nassau’s debt-ridden, patronage-heavy OTB. And the deal passed by the State Legislature does not guarantee a specific amount of money to Nassau County, which has struggled with budget deficits.

In short, approval of the transfer immediately benefited Nassau’s OTB far more than it benefited county taxpayers.

Last week’s vote authorized Nassau OTB to transfer the right to install VLT machines that do not exist from a proposed Nassau gambling hall at Belmont Park that now will never be built, to Aqueduct in Queens.

The nuts and bolts of the transfer — that is, who pays what and how much, and to whom — will be worked out in a contract between Nassau OTB and Genting that will have to be approved by the state Gaming Commission.

While the contract has yet to be formalized, some parameters are known: Nassau OTB will get a $9 million payment this year, after Aqueduct adds the first 400 VLTs, and about $9 million next year. Beginning in 2018 — or sooner, should Genting have all 1,000 VLTs in place — the county OTB would get $25 million a year, plus an amount adjusted for inflation.

But here’s the issue.

While the agreement in principle has OTB transfer money to Nassau County, it does not specify, via an amount or a formula, how much.

“Our goal will be to deliver as much money to Nassau County as possible,” according to a statement OTB issued Monday on behalf of its president, Joseph Cairo.

That lack of specificity — along with Nassau OTB’s $12 million debt — turns last week’s promise of “immediate, recurring revenue” for the county into a wild card.

Which does not make some Nassau officials including County Executive Edward Mangano, happy. “The intention of this should be to get money to the county, not to correct their operating losses,” Mangano said Monday. The county intends to press that point during the contract approval process, he said.

Meanwhile, an official of Suffolk’s OTB, which is in bankruptcy, said Monday that the agency does not intend to transfer its right to bring in up to 1,000 VLTs. The plan remains to place a facility somewhere in the county.

Unlike almost all existing VLT casinos in New York State, OTBs in Suffolk and Nassau have no set minimum of guaranteed payments to either county.

Ongoing contract negotiations in Nassau could — and should — provide the region a chance to change that.

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