Questions about whether a deal to install video lottery terminals at Aqueduct may fall through are increasing jitters that the Belmont Stakes might be canceled this year, officials said Friday.
Controversy erupted this week after an announcement by top state political leaders including Gov. David A. Paterson that, following closed-door meetings, they had selected Aqueduct Entertainment Group to install 4,500 VLTs at Aqueduct.
Some critics questioned Paterson's political connections with former Democratic Rep. Floyd Flake of Queens, a stakeholder in the company. Some losing bidders also complained about what they described as a fickle bidding process that changed continually.
Some lawmakers are now calling for public hearings - even an ethics investigation - and a redoing of the bidding process.
While expressing confidence the famed Triple Crown event will go ahead as scheduled in June, officials said that if the Aqueduct deal collapses it would cut off one of three potential sources of revenue the New York Racing Association, which runs the Belmont Stakes, says it needs to stay afloat beyond May.
The controversy and possibility the deal might collapse "certainly is not good news for NYRA," said state Sen. Craig Johnson (D-Port Washington), who held a public hearing this week on NYRA's finances and the fate of the Belmont Stakes.
But Morgan Hook, a Paterson spokesman, said Friday, "We don't expect it [the AEG deal] will fall apart. I don't think the Belmont Stakes is in jeopardy."
NYRA has been raising the specter of canceling the Belmont Stakes since late December, but the controversy over the Aqueduct deal is the latest twist and potential obstacle.
Charles Hayward, NYRA's president and chief executive, has said NYRA may need another $30 million from the state to save the Belmont racing season unless VLTs are up and running soon at Aqueduct, or NYRA gets back money it is owed by New York City's OTB operation.
But OTB has filed for bankruptcy and may not make the payments, Hayward said this week, and that could prevent NYRA from meeting its payroll obligations. Under state law, NYRA would then have to shut down.
A final option is the state. But with an estimated $8.2 billion budget deficit next year, Johnson said, "Where would we find the money?"
On Friday, Hayward said in a statement "NYRA is looking into every contingency to ensure that we run the Belmont Stakes. The current situation with NYC-OTB will have a bearing on this, and since the resolution to that situation is unknown at this time, we can't make any concrete projections." He did not comment on the Aqueduct deal.
State Sen. Dean Skelos (R-Rockville Centre) said Friday he believes the hearings could be done quickly and a final choice made by the end of this month. "I don't believe it has to disrupt the Belmont Stakes," he said.