New York Racing Association, Inc.


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NYS Comptroller


Taxpayers' Guide to State and Local Audits

New York Racing Association, Inc.
Capital Program Revenue and Expenses (Follow-Up)

Issued: January 24, 2018
Link to full audit report 2017-F-26

To determine the extent of implementation of the recommendations in our initial audit report, Capital Program Revenue and Expenses (Report 2014-S-54).

The New York Racing Association, Inc. (NYRA) holds the exclusive franchise to operate New York State’s three major thoroughbred racetracks: Aqueduct Racetrack, Belmont Park, and Saratoga Race Course. In 2011, Resorts World New York City Casino (Resorts) opened adjacent to Aqueduct Racetrack. According to NYRA’s Franchise Agreement with New York State, a percentage of Resorts’ Video Lottery Terminal (VLT) revenues is to be directed to NYRA for capital expenses, operational support, and enhanced purses. In 2012, a temporary, State-controlled Reorganization Board of Directors was put in place to oversee NYRA operations. The Reorganization Board was dissolved in June 2017, and control of NYRA was returned to a private not-for-profit organization. For the period January 1, 2016 through June 30, 2017, NYRA received about $177 million in revenue from Resorts, distributed as follows: $37 million for operations; $91 million for purses; and $49 million for NYRA’s capital program.  

Our initial audit report, which was issued on October 14, 2015, determined if NYRA received the appropriate amount of VLT revenues for its capital program and whether NYRA officials used these monies appropriately. We found that there were adequate controls in place over the VLT revenues collected by Resorts and transferred to NYRA. However, we found NYRA lacked a formal long-term capital planning process given the magnitude of those revenues. In addition, the annual capital plans used by NYRA lacked supporting documentation for the resources and/or costs associated with the listed projects. In addition, NYRA did not have a formal project management system to effectively monitor capital project status. We also found NYRA used VLT revenues for operating expenses, which was not in accordance with prescribed professional standards.

Key Finding
NYRA made some progress in addressing the issues identified in our prior report. Of that report's four recommendations, two were partially implemented and two were not implemented. 

Key Recommendation
Officials are given 30 days after the issuance of the follow-up report to provide information on any actions that are planned to address the unresolved issues discussed in this report.

Other Related Audit/Report of Interest
New York Racing Association, Inc.: Capital Program Revenue and Expenses (2014-S-54)

State Government Accountability Contact Information:
Audit Director: Kenrick Sifontes
Phone: (212) 417-5200; Email:
Address: Office of the State Comptroller; Division of State Government Accountability; 110 State Street, 11th Floor; Albany, NY 12236