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Best of Howard Stutz

Gaming Guru

Howard Stutz

Aqueduct casino bidding begins again

14 May 2010

NEW YORK, New York -- New York Lottery officials have restarted the search for an operator to manage a proposed 4,500-machine video lottery terminal casino at the Aqueduct Racetrack in New York City.

But after last year's convoluted bidding process, which resulted in Las Vegas-based Navegante Group losing its deal for Aqueduct six weeks after it seemingly won the contract, New York may be hard-pressed to find gaming companies willing to take part in the process.

Navegante, a casino management company headed by veteran gaming executive Larry Woolf, was in partnership with several New York companies that formed the winning consortium.

Navegante beat out several gaming industry heavyweights for the Aqueduct deal during a contentious bidding process, including MGM Mirage, Harrah's Entertainment, Penn National Gaming, Wynn Resorts Ltd. and the Florida-based Hard Rock Casinos.

Legislative leaders and New York Gov. David Paterson chose Navegante's consortium for the contract. However, Paterson pulled the deal off the table in March and said the process would begin anew.

This time, the winner of the bidding process will be chosen by a committee to be led by the lottery director and staffed by lottery workers and a representative of the state Division of Budget, the lottery said in a statement.

New York has been looking to add a casino component to Aqueduct, located in New York City's borough of Queens, since 2001. A deal with a Buffalo, N.Y.-based company fell apart in 2008 and the process was reopened.

Paterson said an "apolitical" method would be used to pick a new supplier after state and federal authorities began probing whether the lucrative contract was awarded to assist one of Paterson's political allies, the Rev. Floyd Flake, who is a former congressman.

The probe was one of several investigations that led Paterson to quit his election bid a week after launching it.

Paterson had included $300 million from the Aqueduct slot machine operator in his initial budget plan to help close a $9 billion budget deficit. The new slot machine selection committee was given a 12-week deadline for making its recommendation to Paterson.

"All bids will be made public once a winner is selected," the New York Lottery said in a statement.