Casino’s dispute is not with horsemen – it’s with wealthy harness track owners
In an editorial earlier this month, the Daily Gazette was correct in calling on the state to settle the dispute which has landed Rivers Casino and the Saratoga Harness Horsepersons Association at odds over payments of a horsemen’s subsidy. However, the real problem is not with Rivers or the horsemen, it’s actually the wealthy, politically connected owners of the Saratoga Casino and Raceway who have somehow escaped culpability throughout this entire dispute.
What many people don’t understand is that the horsemen’s subsidy, which Rivers has been compelled to pay under state law since opening in 2017, requires Rivers to pay the Saratoga Casino’s horsemen and breeders a subsidy to offset any potential Video Lottery Terminal (VLT) revenue losses that the Saratoga Casino might incur due to competition from Rivers. Rivers is the only casino in the state which does not own or operate a harness track that is obligated to make these payments.
Fast forward to state fiscal year 2018/2019, and Rivers has not had a negative impact on the Saratoga Casino’s profitability. In fact, it’s quite the opposite. The VLT commissions paid to the owners of the Saratoga Casino and harness track were up more than $9 million from state fiscal year 2013/2014 according to financial reports filed with the New York State Gaming Commission. At this point, it’s clear the subsidy is no longer needed.
“We have put forth an equitable solution to the state that would free Rivers from having to pay the subsidy, protect our employees, and ensure the horsemen are properly compensated by the owners of Saratoga Casino and Raceway. All the legislature has to do is repeal subsidy and in turn mandate that a small portion of the nearly $60 million in Video Lottery Terminal commissions and profits paid annually (based on state fiscal year 2020) to the owners of Saratoga be set aside to make up for the loss of the subsidy,” said Rivers Casino General Manager, Justin Moore.
“This Ill-conceived law has actually helped make Saratoga Casino and Raceway more profitable since Rivers opened, and it only makes sense for them to resume full responsibility for paying the Saratoga horsemen,” continued Moore.
Everyone can agree that any current revenue decline at Saratoga Casino is attributed to COVID-19 and not to Rivers, and the gaming statute was never intended to place a struggling Rivers Casino on the hook to make up revenue declines at Saratoga caused by an unforeseen catastrophe like the pandemic.
It’s time to end the subsidy and place the responsibility of paying the horsemen where it should reside – solely with the owners of the Saratoga Casino and track.
The Governor has put forth a common-sense proposal that temporarily suspends the outstanding subsidy payment to allow Rivers Casino to remain viable during this unprecedented public health crisis and then relieves Rivers from any future payments. As Schenectady begins to recover from the pandemic, it needs an economic driver like Rivers now more than ever, and the region’s future success depends on eliminating this subsidy once and for all.
The subsidy threatens more than 1,000 jobs – many of them union jobs held by people of color. It also threatens to eliminate the millions of dollars in taxes paid by Rivers to the City of Schenectady, eight Capital District counties, and our schools each year.
Rivers Casino is an example of how sound economic development can transform a struggling city with a poverty rate three times that of Saratoga, help our minority communities, and clean up our state’s brownfields. The urban revitalization Schenectady was experiencing prior to the pandemic was a direct result of Rivers Casino and the region embracing all the fantastic gaming, entertainment and amenities Rivers has to offer.
Further, if Rivers goes out of business because of the subsidy, the horsemen will get nothing, so it’s in the best interest of the state to find an equitable solution that frees Rivers from the subsidy, protects the horsemen, and requires the Saratoga Casino to take full financial responsibility of its horsemen.
And while a lot has also been said of Rivers’ ownership being affiliated with Rush Street Interactive, a publicly traded company, what most do not understand is these are separate companies, and using money generated from one company’s shareholders to pay the bills of another is just ridiculous.
“It’s time for the legislature to eliminate this burdensome and outdated subsidy,” Moore concluded. “And it’s time for the Saratoga Casino and Raceway to resume full responsibility for paying their horsemen, their annual profits have gone up by millions of dollars since we opened, and there are way too many jobs at stake here in Schenectady and in Saratoga.”