The bankruptcy plan, which must be submitted to the court overseeing the Chapter 9 filing, will likely include the closure of many of the least-profitable parlors, cause deep layoffs among the Corporation's 1,400 employees and place greater emphasis on its upscale parlors and its online operations.

The Corporation will ask the legislature to rewrite the OTB laws to permit the Corporation and other OTB groups in the state to contribute revenues to the racing industry and local governments on a net revenue, rather than gross revenue, basis. Currently, NYCOTB pays about nine percent -- $93 million per year -- to the racing industry.

Press reports did not estimate how much less the industry would receive under such a plan, but the Friday edition of the New York Times quoted one key lawmaker as being in favor of the concept.

State Senator Eric Adams, the chairman of the New York Senate Committee on Racing, Gaming and Wagering, was quoted as saying he, "supported changing that system," which he called outdated and outmoded.

The paper also noted that Gov. David Paterson had said, in a separate statement, that he also supported the plan.

NYCOTB officials said they want to negotiate the purchase of video signals from the state's racetracks, rather than have state law dictate the amounts that must be paid, as is currently done.

Funds deposited by customers in New York City OTB betting accounts are not affected by the bankruptcy filing because they are kept separate from the Corporation's operating funds.

by John Pawlak, the U.S. Trotting Association

Courtesy of The US Trotting Association Web Newsroom