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Editorial: OTB-parlor deals bear close scrutiny

OTB and Delaware North are working to finalize

OTB and Delaware North are working to finalize site selection and undertake construction for what OTB officials concede now is an unlikely September casino opening. This slot machine was getting a workout on July 27, 2012, at Resort World Casino in Jamaica, Queens. Credit: Nancy Borowick

The Nassau and Suffolk county off-track betting agencies are slowly making progress with plans to open parlors to host video lottery terminals. As deals near completion, it becomes clear just how much money is involved, and just how careful the scrutiny of where and how that money is spent must be.

Monday, Nassau OTB authorized the borrowing of up to $100 million to purchase land and construct a building to hold 1,000 video lottery terminals. Nassau OTB president Joseph Cairo says the property is picked out, but he won't divulge where it is or who owns it until a deal is sealed. That doesn't seem like a transparent way to do business when this much public money is involved, and when the potential for angry neighbors is high.

Suffolk's OTB has purchased a former movie theater site in Medford for $11 million. Off Exit 64 of the LIE and east of Route 112, the location a pretty good spot for such a business, and OTB president Phil Nolan says he hopes it will open by late 2015 or early 2016. Time is of the essence because the agency is trying to emerge from bankruptcy and is borrowing $76 million to build and open the parlor.

Each facility could generate as much as $160 million a year in lottery-terminal profits. What's left after the expense of paying for employees, vendors and professional services will be split between local and state governments. That means that in building, opening and running the parlors, fortunes will pass through the hands of two of the most political organizations on Long Island. Close attention must be paid.