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Suffolk OTB rescinds contracts for leaders

The Suffolk Regional Off-Track Betting Corporation board will rescind five-year contracts for the agency’s president and vice president after the state Gaming Commission said long-term employment contracts were invalid, the board’s counsel said Thursday.

The Gaming Commission in December cited case law and a state Attorney General opinion that the two top OTB positions must “serve at the pleasure of the Board,” and that the contracts violated that standard.

OTB board counsel Kevin Snover said the board met in executive session Thursday and decided to rescind the five-year offers, although the board “expressed confidence” in president Phil Nolan and vice president Anthony Pancella III. They will continue to serve at the board’s pleasure.

In January 2015, the board awarded contracts to Nolan and Pancella guaranteeing their positions through 2020, as the bankrupt horse race wagering agency waged a fight to open Suffolk’s first casino with up to 1,000 video lottery terminals.

The board discovered it had no record of a vote after a Newsday open records request. It held a public vote to approve the contracts in September.

Nolan made $152,000 in 2014, while Pancella made $142,000, according to the latest payroll information available.

“These two guys are the best we ever had,” Dominick Feeney, chairman of the three-member board, said in September.

While the OTB president and vice president technically serve at the pleasure of the three member board, which is appointed by the Suffolk Legislature, they are picked by political party leaders.

Asked about the contract issue, Suffolk Democratic Chairman Rich Schaffer called the issue “academic at this point.”

Republican Chairman John Jay LaValle did not return a call for comment.

Officials have said they hope to open the video lottery casino in the former Islandia Marriott in February, with 260 machines. Nearby residents have sued to block the casino.

In an effort to stay afloat, Suffolk OTB has sold its headquarters building, closed branches, reduced the number of employees and taken out loans from its casino management company, Delaware North.

Suffolk OTB has lost money every year since 2006 as interest in horse racing declined.

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