NY comptroller OKs Aqueduct slots contract for lucrative NYC market; revenue to help state

By Michael Virtanen, AP
Monday, September 13, 2010

NY comptroller approves Aqueduct slots contract

ALBANY, N.Y. — More than 1,000 video slot machines may soon be whirring at Aqueduct race track in New York City now that a long-delayed contract has gotten final approval from state Comptroller Thomas DiNapoli.

DiNapoli approved a contract for Genting New York LLC to build and operate about 4,500 of the machines at the thoroughbred track in Queens, he said Monday. Once officials deliver the approved contract to Genting, the company has 10 days to pay the state $380 million upfront.

State officials say they expect eventually to get $1 million a day in revenue from the racino gambling.

“Obviously we’re going to expedite this as quickly as possible,” said Jennifer Givner, spokeswoman for the state Lottery Division, which managed contract bidding. Work is expected to begin by the middle of October, she said.

The subsidiary of Genting Malaysia Berhad proposed opening a preliminary phase with 1,600 slot machines six months after contract approval. The rest would follow six months later on two floors, with a pedestrian bridge to the Aqueduct subway station.

“We are eager to immediately begin investing, creating jobs, sparking economic activity and bringing New York a one-of-a-kind iconic, entertainment destination,” said K.T. Lim, chairman of Genting Malaysia Berhad.

Genting New York was the lone bidder left for the deal to build the racino with 4,525 video slots at the track, after two other bidders were disqualified for submitting proposals that deviated from the state’s bid specifications. The winning company offered the state an upfront fee $80 million more than the $300 million minimum required.

“After nearly a decade of false starts and broken promises, the VLT contract is done,” DiNapoli said. “The VLT contract involves hundreds of millions of dollars. It’s a 30-year license that carries the future of New York’s racing industry on its back.”

Lottery Director Gordon Medenica had written to Gov. David Paterson saying Genting New York had a clear, rational plan for navigating the city’s complex construction and operating environment.

In their evaluation, Lottery officials said the parent company has $1.6 billion cash on hand and market capitalization of $5.25 billion. It is part of the Genting Group, a multinational organization that includes Resorts World casino resorts in Malaysia, Singapore, the Philippines and Britain, as well as power plants, major palm oil production, plus oil and gas exploration and production.

In a presentation to state senators in August, company representatives discussed plans for 1,300 construction jobs and 800 permanent jobs, as well as eventual hopes to add table games like black jack and roulette.

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