New York Racing Association
Audit of the Annual Franchise Fee for Calendar Years 2002 and 2003 The New York Racing Association, Inc. (NYRA) is a not-for-profit organization franchised by New York State to conduct racing and pari-mutuel wagering at the State’s three major thoroughbred racetracks: Aqueduct, Belmont Park and Saratoga. NYRA is required to pay the State an annual franchise fee, which is to be calculated in a manner prescribed by the State Racing Law. We audited NYRA’s calculation of this fee for 2002 and 2003, and determined that the fees were understated by a combined total of at least $25.7 million and as much as $27.7 million. The fees were understated because some expenses were overstated and certain adjustments required by the Racing Law were not made. We recommended that NYRA correct the errors that caused its franchise fees to be understated. We also determined that NYRA’s financial condition continued to deteriorate, as its accumulated deficit increased from $40.2 million in 2000 to $102.2 million in 2004. We noted that NYRA had made little effort to produce realistic budgets or reign in its expenses. We recommended that NYRA improve its budgeting practices.
For a complete copy of Report 2005-S-3 click here.