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#2
05-24-2010, 02:34 PM
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Paterson proposes $25M loan to NYRA
By Matt Hegarty New York Gov. David Paterson has proposed legislation that would allow the New York Racing Association to borrow $25 million from a line of credit that is being offered to fund construction of a casino at the association's Aqueduct racetrack, according to the governor's office. The proposal would shore up NYRA's financial position amid contentions by the association that it is in danger of running out of cash this summer. Last week, NYRA sent out notices to its 1,400 employees informing them that it was considering closing its tracks on June 9 due to the cash squeeze. Paterson's proposal would allow NYRA to use $25 million of a $250 million loan that the state has already guaranteed to fund the construction of the Aqueduct casino "for services and expenses" at NYRA's three tracks, according to a memo prepared for the legislation by Paterson's office. NYRA would be required to pay the loan back by March 31, 2011, or within 30 days of the state signing an agreement with the operator of the casino. If the loan is not repaid by March 31, the memo says, then the state's lottery would be required to pay the money back to the state using proceeds that NYRA has been promised from the casino's operating revenues. NYRA and its horsemen will receive approximately 13 percent of the casino's net revenues once it is up and running. According to the memo, the loan would be advanced to NYRA once the legislation is passed.
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