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Aqueduct VLTs "Signal Revolution In Racing Industry"
Also in the US, Thoroughbred Daily News has produced a special 20-page report, beginning with the declaration: “When the New York Racing Association announced video lottery terminal-fueled purse increases of almost 40% for its racetracks in 2012, with further increases projected for 2013 & 2014, it might not just signal a change for New York, but for the way the entire industry does business.” New York Racing Association executive vice president Hal Handel enthused: “The purse money alone could be in excess of US$40 million, in new money. So if you start spreading that over 200-plus racing days, it’s a very, very meaningful infusion of money, and it really will put New York on a plateau by itself.” TDN commented: “Welcome to the ‘new’ New York racing & breeding industry, where VLTs at Aqueduct Racetrack in Ozone Park, Queens, are projected to generate astronomical gains for NYRA & its 3 tracks, as well as trainers, owners, breeders & stallion owners, and the state of New York itself. Genting New York (which will operate the Aqueduct racino) is expecting to install 4,525 VLT machines, with the first flight opening sometime in October & the remainder at year’s end. Genting recently announced that 475 electronic table games would be added to the casino project. Once all of the machines are up & running, NYRA estimates they will generate US$574,875,000 in revenue per year. This figure is based on the estimated US$350 per day that NYRA is expecting each machine to gross (called the win-per-machine figure). Genting & the state have already written into contract a schedule for distribution of the revenue, which shows great gains for the racetracks & breeders. For the 1st year of operation (autumn of 2011 to autumn of 2012), 6.5% of the VLT revenues has been allocated to purses. That works out to over US$37 million going straight into NYRA’s purse account in the 1st year, with an increase to 7% for year 2 & 7.5% in year 3.” The New York Thoroughbred Breeding & Development Fund “will also benefit, with 1% of VLT revenue allocated for year 1 & 1.25% & 1.5%, accordingly, in the following 2 years. For year 1, this means an additional US$5.7 million for breeders.” A significant slice of the VLT pie “will also go to proactive efforts such as racetrack improvements & marketing of the casino. NYRA is expected to receive US$22 million in the 1st year for capital expenditures (4% of VLT revenue), which will be dedicated to maintaining & upgrading the NYRA racetrack facilities, both frontside & backside. Another 3% (over US$17 million) will go to NYRA for their general racing operations. In addition, Genting will use 8% of the VLT revenue in the 1st year for marketing the Aqueduct racino.” (The remaining 44% will go the state for education.) TDN summed up: “The percentages for year 3 will be effective through the remainder of Genting’s contract, which is 30 years, with a possibility of 10 more years based on performance. While the rest of the industry struggles to find its footing in the new landscape since the global recession, major farms are opening or eyeing divisions in New York, and breeders in the Empire State are preparing for a sea change, as racing New York-breds is about to become as sure a thing as exists in racing.”