Editorial: Regional OTBs need relief, too

There are only 25 days remaining for the current government in Albany, but that's still enough time for it to give Long Island another kick in the knees. Its parting shot could be the bailout of New York City's Off Track Betting operation without giving the same needed relief to regional operations in Nassau and Suffolk.

New York State needs a comprehensive strategy to manage the future of gambling here, as bigger payouts from Internet sites siphon off bettors, Indian gaming grows, and video lottery terminals dominate. OTB needs a modern business model - or it needs to go out of business. Instead, the State Senate will meet tomorrow in typical crisis mode to put out the latest fire stemming from the state's losing gaming policy.

On the table is a proposal that would turn over the bankrupt city OTB to its creditors, which include the track owners who bled it dry with demands for high subsidies and the New York Racing Association, which runs three thoroughbred tracks and is always next in line for state handouts. Under the plan, this consortium will get OTB's telephone and Internet business in return for restructuring the subsidies that the legislature forces all the quasi-public bookie operations to pay.

A rescue of the city operation, fair deal or not, is needed because Mayor Michael Bloomberg outmaneuvered Gov. David A. Paterson in 2008 and the state wound up on the hook for $700 million in employee pension and health care obligations. Besides the 800 jobs now at risk, closing the city's parlors would likely cause purses to go down and increase the racing industry's demands from the regional OTBs.

While the city OTB was also sunk by bad management, patronage and lousy real estate deals, the Nassau and Suffolk operations are still managing, even in this stalled economy, to throw off some winnings. But they could be turning over a lot more to give county taxpayers some relief. Wasn't that the justification for legalizing betting in the first place?

Suffolk, for example, gives more than 70 percent of its revenue to the racing industry and just about 11 percent to the county. When OTB money started flowing in 1975, the breakdown was 23 percent to the industry and 53 percent to the county. Suffolk OTB calculates that if it got the same deal as the one proposed for the city, next year it might be able to provide $7 million instead of just the $2 million it is giving the county treasury this year. Nassau's numbers are similar.

The only justification for rescuing the city's betting operation is to give all the other regional OTBs the same relief from subsidies. It's unfair to force the OTBs to pay the same rate to the harness tracks, which are now benefiting from VLT lucre. The Senate should reject the Assembly-approved bill in favor of a broader one sponsored by Sen. Andrew Lanza (R-Staten Island).

A comprehensive plan isn't going to emerge in the waning days of this trading bazaar that has substituted for governing. Not being fleeced is all that can be asked for now. hN