Bellone demands to sees Jake's 58 sales contract, OTB management plan

Suffolk County Executive Steve Bellone on Tuesday demanded that Suffolk OTB officials turn over copies of its contract to buy Jake's 58 casino and documents outlining the agency's plan to manage the Islandia betting parlor.

During a news conference outside the casino, bought last week for $120 million by Suffolk OTB from Buffalo-based Delaware North, Bellone accused OTB officials of skirting public scrutiny before completing the purchase, which includes the attached 228-room hotel.

"This is an agency that just recently emerged from bankruptcy," Bellone said. "Every dollar that is not spent wisely, every dollar that is wasted, is a dollar that has been taken out of Suffolk County taxpayers' pockets."

OTB officials have said owning the lucrative video-lottery betting parlor would save the agency about $13 million annually in rent and management fees. Jake's 58 has been among the state's most successful casinos since it opened in February 2017. It helped Suffolk OTB pay millions in debt and escape bankruptcy last year.

In a statement, Suffolk OTB president and chief executive James LaCarrubba said taxpayers would have no role in paying for the purchase, adding the deal had been approved by the state Gaming Commission.

"As we have repeatedly discussed with Suffolk County officials, as the debt service on the transaction is less than we are currently paying in management fees and rent, this is an immediate net positive for taxpayers, a benefit that will only grow in time," LaCarrubba said.

Democratic and Republican county legislative leaders have said they supported OTB's purchase of the casino.

Suffolk OTB is a public benefit corporation operated by a board of directors appointed by Republican and Democratic officials. It has paid hundreds of millions of dollars to Suffolk County, the state public education fund and the horse racing industry since Jake's 58 opened.

LaCarrubba said OTB paid $7.25 million to Suffolk earlier this year, which he called "the largest single transfer to the county in our history."

Jake's 58 took in $328,749,460 worth of bets in April, the most recent month available, according to the Gaming Commission website.

Bellone did not dispute Jake's 58's success, but said OTB officials should have been more transparent about the transaction. He said OTB has failed to comply with his request for copies of the sale contract, as well as copies of a legal settlement struck last year to conclude dueling 2019 lawsuits between OTB and Delaware North.

Bellone said OTB also ignored his calls to delay the purchase until an independent consultant could review the deal. The county had hired Morowitz Gaming Advisers for $65,000 to conduct the review.

"If we do find that there was something problematic, then I would think that we would take some kind of actions," Bellone said. He did not say what actions he might take.

By Carl MacGowan

carl.macgowan@newsday.comCarlMacGowan

Carl MacGowan is a Long Island native who covers Brookhaven Town after having previously covered Smithtown, Suffolk County courts and numerous spot news and feature stories over his 20-plus year career at Newsday.