Lawmakers discuss merging out-of-track betting companies in Hudson Valley and Capital Region after mismanagement scandal

ALBANY — After the New York Inspector General’s office uncovered alleged mismanagement at the Catskill Regional Off-Track Betting Corporation, lawmakers are considering how to reform the public company, including discussing a possible merger between the beleaguered organization and the Capital District Regional Off-Track Betting. Company.

If a merger is approved, the new off-track betting company would collect bets on horse racing from Rockland County to the Canadian border.

Emma Fuentes, spokeswoman for State Sen. James Skoufis, D-Woodbury, told The Times Union on Monday that conversations about a possible merger are “ongoing” with “stakeholders.”

Skoufis told the Mid Hudson News, “We are also in preliminary discussion about whether to merge Catskill OTB with a neighboring OTB and integrate the organization with a neighboring organization that has a more efficient and better management history.” He said the OTB would most likely be the Capital District organization, based in the Albany area.

Skoufis was previously advancing legislation to remove and replace all Catskill OTB board members following the mismanagement scandal, but now the senator is considering whether a merger is a better path, Fuentes said.

Catskill OTB Chairman Donald Groth and Capital District CEO John Signor could not immediately be reached for comment Monday afternoon. The Catskill OTB board is due to meet on Tuesday for the first time since the inspector general’s office released its findings.

In March, the Inspector General’s Office released a 2018 report detailing findings that Groth, who has run Catskill OTB for decades, engaged in mismanagement of the company, including spending millions of dollars to rent warehouses filled with worthless equipment and waste. He was also accused of abusing his company car, dating a junior employee and receiving a state pension in addition to his salary. Groth denied any wrongdoing in a recent interview and defended his leadership of the company.

The release of the report resonated with many local lawmakers, some of whom demanded a leadership reshuffle in response.

New York also considered OTB mergers in 2019 when the then government. Andrew M. Cuomo suggested in a budget proposal to give OTBs the power to merge. This recommendation was never adopted in the final budget. At the time, Signor said Capital District OTB would consider a merger under the right circumstances, while Groth said his company was not “actively seeking” a merger.

Catskill OTB operates horse racing betting parlors and kiosks, as well as online betting throughout the Hudson Valley. The Capital District OTB offers the same services in the northern counties and operates a horse racing television channel. As public benefit corporations, both distribute their revenues to local counties, the state, and the horse racing industry.

Catskill OTB has consistently collected the least revenue of New York’s five regional off-track betting companies for several years, while the Capital District operation has seen significantly higher revenue, according to Gaming Commission reports. of State.

Groth testified before the state legislature in 2018 that Catskill OTB was in “financial peril.” In a recent interview with The Times Union, Groth blamed the company’s money troubles on a waning interest in horse racing and said the legislature must grant Catskill permission to operate lottery terminals. video to turn his business around.

In this year’s budget, the state gave the Catskill and Capital District OTBs more financial flexibility by allowing corporations to draw on their capital funds to cover operating costs and statutory obligations. Catskill has saved millions in its capital fund, sources said.

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