NYC Off-Track Betting threatens shutdown

[brooklynite]

from Crain's New York Business:

The New York City Off-Track Betting Corp., which filed for bankruptcy reorganization last month, said it would close its doors by March 30 unless it gets financial help soon.

“Cash flow continues to deteriorate,” said Sandy Frucher, chairman of the state-controlled outfit, during a board meeting Monday, adding that “with serious trepidation and sadness” the OTB would send layoff notices to its nearly 1,500 employees.

The announcement is apparently an effort to get the attention of the state, city and the agency's business partners, which share in about $1 billion of annual revenue generated at the parlors. The OTB claims that divvying up the cash between the racing industry and governments has left it without enough money to invest in the upkeep or modernization of the city's 65 betting parlors. Same-store sales are down more than 5% through the first few weeks of the year, the company said Monday. Mr. Frucher has argued that if the OTB were able to retain more cash, it could borrow money from private investors to update operations.

Closing the OTB would stick the state with about $600 million in pension and benefit obligations, Mr. Frucher said. The company threatened to close itself down in early 2008, which resulted in the state taking it over. Early last month, the company filed for bankruptcy, a rare case of a state agency putting its fate in the hands of bankruptcy-court judge.

...because you just can't make money with a bookie operation...