Caveats for Belmont Park Reconstruction Project

Democrats who control the Legislature in New York State are embracing a plan pushed by the New York Racing Association for a major reconstruction project at Belmont Park, but with some important caveats.

The move by lawmakers agreeing to the concept of the Belmont financing plan represents a key step forward for the Belmont initiative, which was rejected only nine months ago by the Legislature during the last major play by NYRA before the Democratic-led Assembly and Senate.

Assembly Democrats, in a one-house state budget plan released Tuesday afternoon, accept the initiative proposed this year by New York Gov. Kathy Hochul to provide a $455 million loan to NYRA for the Belmont project.

But the Assembly plan, set to be okayed by lawmakers later this week, removes Hochul's requirement that Aqueduct Racetrack be shut down racing once the Belmont construction is completed in about three years. 

NYRA, and Hochul, pushed the Aqueduct closure plan as a way to consolidate racing in the New York City area at one track—Belmont—and to free up valuable real estate opportunities at Aqueduct, a prime piece of land not far from New York City's major international airport, JFK.

The Assembly plan does not ban Aqueduct from closing, but it removes the requirement in the Hochul plan that it must be shuttered as part of the Belmont financing project.

The Senate Democratic plan, meanwhile, also accepts Hochul's Belmont funding plan, but also with changes. For instance, Senate Democrats add provisions they say will ensure that commitments made by NYRA for renovations are "upheld," and that any future real estate development at Aqueduct includes an affordable housing component.

Both the Assembly and Senate also insist on certain union and other labor protections for the Belmont construction project, including for businesses owned by minorities, women, and service-disabled veterans. 

Additional documents outlining the Belmont plan's wording by the two houses were set to be released later today. But the Senate and Assembly did release key legislative memos describing the acceptance of the Hochul Belmont plan and the proposed legislative changes.

The Senate plan also includes language clarifying the role of Hochul's Division of the Budget and the Franchise Oversight Board, a state panel that monitors NYRA's finances, over the Belmont agreement between the state and NYRA.

The Hochul plan would require that NYRA's lease to operate racing at Aqueduct end when the Belmont construction project is substantially completed. Part of the governor's sales job for the state lending NYRA $455 million was that the state, which owns the properties at the three Thoroughbred tracks operated by NYRA, would end up with a lucrative real estate project at Aqueduct after racing ends and the track is razed. The Hochul administration has not detailed what might be in store for the Aqueduct property, which has made some lawmakers reluctant about the commercial density or use that might eventually replace the racetrack.

Sen. Joseph Addabbo, a Queens Democrat who chairs the Senate racing, gaming, and wagering committee, said in an interview Tuesday that Senate Democrats are supporting Hochul's $455 million borrowing plan for NYRA's Belmont initiative, which includes a new grandstand, major track work, and the opening of the track's infield.

"I think it's a great deal for the state. The state makes out financially,'' Addabbo said of the Belmont package. He said the state and NYRA will end up with a more up-to-date, environmentally friendly track "and a more efficient NYRA.''

"The pros far outweigh the cons,'' Addabbo said. 

As for concerns raised about equine health matters, such as by PETA and other groups, Addabbo said the Belmont project is not going to be stopped because of those opponents. "Some say stop the project, get rid of the racing industry," he said. "We're not going to get rid of an industry with 19,000 jobs statewide.''

Addabbo said the NYRA and Hochul proposal to close Aqueduct and consolidate future downstate racing at Belmont, which would be built to accommodate winter racing, "makes sense."

"I think NYRA becomes a much more efficient entity by merging the two,'' Addabbo said.

The Assembly and Senate budget plans containing the Belmont matter are not final. But they do lay out starting points for where majority party lawmakers in the two houses stand on the topic. The non-binding, one-house budget bills will serve as negotiating points as the Assembly, Senate, and Hochul now rush to complete a final 2023 state budget before the new fiscal year starts April 1.

The Belmont construction proposal has a far better chance of passage now than it did a year ago. Last year at this time, and again at the end of the session in June in Albany, legislators killed the NYRA financing plan for a host of political and fiscal reasons. NYRA, and a coalition of interests, spent considerable time and money since then promoting and educating lawmakers about the project's importance.

NYRA noted it's been generations since the last major construction at Belmont, and that the track needs to be modernized to attract new racing fans, as well as to be a home for entertainment events beyond racing. They say the state-owned assets at both Belmont and Aqueduct will be vastly increased by the project.

The Hochul proposal, contained in her state budget plan unveiled earlier this year, envisions the state providing $455 million to NYRA for the Belmont project, with NYRA paying back the state at least $25.8 million annually until the loan is retired.

The Hochul budget, released Feb. 1, includes a specific condition that NYRA, in order to receive the Belmont financing, must "enter into an agreement with the state relinquishing to the state its leasehold interest in real property located in South Ozone Park, commonly known as Aqueduct Racetrack, upon substantial completion of the renovation of Belmont Park racetrack."

The Assembly budget alternative released Tuesday afternoon, though, strips out "any" references in the Belmont deal pertaining to Aqueduct being "required" to close after the Belmont construction is completed.

NYRA appeared to express a sense of optimism about the Belmont plan's chances on Tuesday afternoon following release of the legislative plans.

Patrick McKenna, a NYRA spokesman, said the support of "this transformational project" by Hochul, Senate Majority Leader Andrea Stewart-Cousins and Assembly Speaker Carl Heastie, as well as rank-and-file lawmakers, protects "the interests of thousands of hard-working New Yorkers on Long Island and across the state."

McKenna said the plan will protect and create jobs "and secure the future of thoroughbred racing in New York State at no cost to taxpayers."

"Supporting a new Belmont Park also means standing up for organized labor, protecting countless small businesses and preserving family farms reliant on the statewide racing ecosystem. Horse racing means jobs and opportunities for thousands of New York families in every corner of the state. That's what a new Belmont Park is all about, and we'll continue working with leaders in Albany to get this project across the finish line,'' he said in a written statement.

The Senate Belmont provisions, released Tuesday afternoon, state that Aqueduct's future use must include a mix of residential and non-residential use, including meeting or exceeding "affordable housing developments" as defined under state zoning laws. The project would need to be competitively bid and the process must begin within a year after NYRA relinquishes its lease to operate Aqueduct. The Senate plan includes a role in the process for a community advisory committee, whose members would include representatives of the Legislature and the city mayor's office.

The Senate plan also includes language to ensure that loans provided to the state by NYRA continue to be paid if NYRA no longer has its exclusive Thoroughbred franchise agreement with the state. The current NYRA operating franchise is set to expire in 2033; the Belmont financing plan calls for the loan to be paid for over 30 years; money would come from revenue sharing proceeds NYRA gets from the video lottery terminal machine receipts at the Aqueduct casino operated by Resorts World.