OTB Closed for Good: Senate Fails to Pass Rescue Bill

A bill to bail out New York City’s Off Track Betting parlors was defeated in the State Senate, leaving New York’s racing industry in “turmoil,” said the chair of the OTB board, Larry Schwartz. He is pulling the plug on the operation at midnight Tuesday.

Schwartz, who is also Governor David Paterson’s Chief of Staff, said it’s a “sad day for the state of New York,” and that nearly 1,000 people will be losing their jobs. He says tens of thousands of other racing industry jobs are now at risk, and predicts harness tracks will close and breeders will move out of state. After the bailout bill failed in the State Senate, he says he had no choice but to shut the OTB parlors down.

“New York City OTB doesn’t have any money. It’s bankrupt, its out of cash,” said Schwartz. “We can’t pay our operating expenses.”

Schwartz says the board delayed the closing of the OTB parlors for four days, to give the Senate one last chance to pass the bill, even delaying rent payments to keep the betting offices running.

In the Senate, the blame game began before the voting was even finished. Sen. Jeff Klein, a Democrat, who supported the bailout said opponents, mainly Senate Republicans, had signaled the death knell for racing, and will punish nearly 900 OTB workers in a bad economy.

“With the Christmas holiday approaching, and some of the people are here,” said Klein, pointing to OTB workers from the DC-37 union witnessing the debate in the Senate galleries. “To actually put them on the unemployment line at this point in time is inhuman.”

Sen. Klein and others say the workers may not even be able to collect unemployment benefits, because they are technically terminated, not laid off.

GOP Senators, most of whom voted against the bill, say it’s the Democrats’ fault for the bills failure, because they could not produce the 32 votes needed for passage. Several Senators were absent, including Sen. Kevin Parker, who was convicted Tuesday of two misdemeanors in an assault case.

Republicans offered an alternative bill that would have extended the aid offered to the New York City OTB to all other OTB’s upstate and on Long Island. Bill sponsor Sen. Andrew Lanza says it’s the Democrats who are playing “politics.”

“Let’s stick it to the other side, let’s be able to blame them,” said Lanza, who said Democrats should “love” his bill. “If you really want to solve this problem, you’ve got to do it in a comprehensive and thoughtful fashion.”

Schwartz says the other OTB’s could have been addressed in January.

The governor’s chief of staff refused to point fingers at either party, saying he did what he had to do.

“I had a fiduciary responsibility,” Schwartz said.

The closure of New York City’s OTB could also mean the state’s budget deficit may grow by several hundred million more dollars, because revenues will no longer be paid to the state.

OTB CEO Greg Rayburn says the illegal bookies “will be thrilled.”

Union workers outside Senate chamber protesting OTB closures