Jan 13
2022
Kennedy proposes OTB reforms
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A series of legislative proposals announced Thursday by State Sen. Tim Kennedy are an effort to correct what he called “perverse dysfunction” at Western Regional Off-Track Betting Corp.
Kennedy proposes three bills in response to an audit by the Office of the State Comptroller, he said. The audit criticized OTB leadership for a bevy of issues, including managers and board members improperly taking tickets to luxury suites at sporting and music events at Highmark Stadium and Keybank Center.
“There has been perverse dysfunction happening at the OTB and it needs to be addressed,” Kennedy told Investigative Post.
The government-run, Western Regional OTB is owned by 17 county and city governments in Western and Central New York. Each municipality receives an annual cut of OTB profits, based on population, from the operation of its casino, racetrack, hotel and betting parlors.
To address the tickets, which the comptroller valued at about $200 each, Kennedy proposes that OTB board members be held to the standards of Public Officers Law, a common standard which prohibits state employees from receiving gifts valued at over $15.
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Kennedy’s legislation would also change the composition of the board. Currently, each of the 17 counties and cities that own a piece of OTB appoint a member. Kennedy’s bill would reduce the board to 15 seats. Notable change include increasing Erie County’s representation from one to four members, reflecting its larger population – , giving additional seats to the most populous counties, and representation to appointees of the governor, state Senate president and Assembly speaker.
The change board makeup would foster “responsibility, accountability and transparency,” Kennedy said. “The way you do that is by creating a structure in the board that is reflective of the population that it serves.”
In addition, Kennedy announced a bill that would prohibit OTB-owned cars or trucks from being used as take-home vehicles. Questions from Investigative Post regarding a vehicle used by OTB’s President and CEO, Henry Wojtaszek, led to him turning it in in 2019.
The comptroller audits, released last September, confirmed prior reporting by Investigative Post that examined OTB operations. The reporting was responsible for drawing the scrutiny of public officials, Kennedy said.
“The information that was provided by Investigative Post caught the attention of all public officials, and I think the state Comptroller doing his report really galvanized an effort to make the changes necessary to make the OTB more transparent,” he said.
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According to Kennedy, it was OTB’s lack of response to reporters’ questions that struck him, and other officials. It highlighted a “lack of accountability,” he said.
“That is unbecoming of any government agency or appointees of a government agency,” he said. “It’s expected that these government agencies are responsive to the people, are acting in accordance with the law in a transparent and responsible way, and I think that this legislation will accomplish those goals.”
The comptroller’s audit left one controversial matter unaddressed — a deluxe health, dental and vision insurance benefit package for OTB board members.
Instead, the comptroller referred the health insurance issue to the New York State Attorney General’s Taxpayer Protection Bureau, according to a letter obtained by Investigative Post. Jennifer Freeman, a spokesperson for the comptroller, told Investigative Post the board should “cease this practice and recover any unlawful payments.”
At the time, OTB officials did not comment on the referral, but prior to its release, the OTB board voted to do away with health insurance for future board members. Present board members continue to receive health insurance, which in 2020 cost OTB about $20,000 a year for the 11 current and retired board members who received it.
Kennedy said he couldn’t speak to law enforcement matters.
Kennedy’s proposals are at the earliest legislative stage, but they have the support of State Comptroller Thomas DiNapoli. In a prepared statement accompanying Kennedy’s announcement, DiNapoli said his auditors found a “troubling disregard for appropriate safeguards to hold people accountable and protect public resources” when reviewing OTB operations.
“Senator Kennedy is proposing legislation that addresses this mismanagement and our major audit findings,” DiNapoli said. “I look forward to working with Senator Kennedy on these critical reforms and holding government accountable.”
Other recent controversies at OTB include:
- A former employee turned whistleblower is suing OTB, alleging he was harassed and fired in retaliation for cooperating with state and federal investigations.
- OTB received $3.2 million in federal assistance through the U.S. Small Business Administration’s Paycheck Protection Program in 2020 during the early stages of the COVID-19 pandemic, but still furloughed hundreds of employees.
Wojtaszek, in a statement responding to Kennedy’s bills, said: “We made immediate changes to internal policies after the State Comptroller’s audit. From reducing the number of take-home cars, to making improvements of how we distribute tickets to our valued customers. We are always striving to improve operations. In the meantime, we will collaborate with local legislators to focus on continuing the momentum we’ve built over the last few years.”
