Feb 23


OTB wants to expand gambling in Buffalo

A little-known provision in state law prevents bars and restaurants within a 30-mile radius of Hamburg Gaming from hosting Off-Track Betting terminals. Buffalo's new board member wants to change that.

After an eight-month delay, Buffalo’s new representative on the Western Regional Off-Track Betting Corp. board of directors participated in her first meeting Thursday and has already taken on a major project: Changing state law to make it easier for Buffalo residents to bet on horse races.

Crystal Rodriguez-Dabney, former deputy mayor to Mayor Byron Brown, said she wants to give bars, restaurants and bowling alleys in Buffalo and Western New York the opportunity to install betting terminals, supplied by OTB, as a way to earn more revenue. The terminals, called E-Z Bet, allow gamblers to bet on any horse race Western OTB is simulcasting. OTB and the business then split the revenue.

But getting those terminals into Buffalo bars and restaurants will not be easy. State law currently allows Hamburg Gaming — owned by the Erie County Agricultural Society’s Buffalo Trotting Association Inc. and operated by Delaware North — to veto the placement of E-Z Bet terminals within a 30-mile radius of its racetrack. That means OTB cannot place the terminals in Erie County, or most of Niagara County, without Hamburg Gaming’s permission.

Rodriguez-Dabney, a Democrat, was appointed to the OTB board last summer but only recently had her gaming license approved by the state Gaming Commission. Part of the delay was caused by her having to resign from her leadership position in the Erie County Democratic Committee, since it’s illegal for party officers to hold gaming licenses. She holds 10 of the board’s 99 votes and is part of a Democratic takeover of the historically Republican-controlled board, made possible by reform legislation passed last year. OTB owns and operates Batavia Downs racetrack and casino, as well as several branch locations around Western New York.

OTB leadership said they plan to ask their lobbyists in Albany to work on the E-Z Bet issue this legislative session. Assembly Member Jonathan Rivera, whose district includes Hamburg Gaming and parts of Buffalo, has expressed interest in the issue, a spokesperson said.

OTB spends more than $100,000 on lobbyists each year, records show. The agency hires firms like Mercury Public Affairs, Upstate Strategic Partners (run by former Buffalo lawmaker Sam Hoyt) and Bolton-St. Johns to inform it of proposed legislation and interface with lawmakers and Gaming Commission members.

Crystal Rodriguez-Dabney.

“I think it’s important because it’s an opportunity for small businesses to be able to make a little bit of extra money,” Rodriguez-Dabney said. “Looking at the other municipalities that have businesses that have this, it’s been beneficial to them, so why should city businesses miss out?”

Rodriguez-Dabney said she views E-Z Bet terminals as a way to keep small businesses on the East Side open and thriving.

“For doing nothing but allowing for a corner in your business, you’re making extra bucks,” she said. “If that’s $5,000 a year, that’s $5,000 of passive income, quite honestly, that may be able to help keep a business afloat or help with investments or help with something.”

Ryan Hasenauer, OTB’s marketing director, said the agency made $428,000 last year from E-Z Bet machines spread out over 15  counties. That translates to several thousand dollars in revenue for each business that hosted a terminal.

To date, OTB officials said, Hamburg Gaming has only approved the placement of two E-Z Bet terminals in Erie County. Only one remains open.

Sean Schiano, vice president of operations for OTB, said that’s partly due to a disagreement between OTB and Hamburg Gaming over the share of revenue from E-Z Bet terminals. Hamburg Gaming wants a higher percentage than OTB can afford, he said. 

“They want us to do all the work and they get a piece of the profit,” he said. “We’re trying to run a business. We’re all trying to make money.”

In addition to splitting the terminal revenue with the host business, OTB pays to maintain the machines and shares a percentage of the revenue with the racetrack that approved the placement. Finger Lakes Gaming & Racetrack, Schiano said, regularly approves E-Z Bet terminals and OTB pays that organization more than $1 million each year as a result.

Get our newsletters delivered to your inbox
* indicates required

Newsletters *

A spokesperson for the Erie County Agricultural Society, which owns Hamburg Gaming,  did not immediately respond to a request for comment.

OTB wants to see the 30-mile radius rule eliminated, or at least significantly reduced, Hasenauer said. Hamburg Gaming may worry that more E-Z Bet terminals would mean fewer visitors to the raceway, he said, but argued that isn’t necessarily true.

“I don’t think that if we had an E-Z Bet that was somewhere within a certain radius in Buffalo that it would prevent people from still going to visit the track and still making those wagers on their property,” Hasenauer  said. “Watching the Bills on TV is a lot different than being in the stadium.”

Donate to support our nonprofit newsroom

It remains to be seen whether any lawmakers take up OTB’s and Rodriguez-Dabney’s cause, and whether their lobbying will be successful. Rivera’s spokesperson said he’s willing to meet with Rodriguez-Dabney about the matter. OTB suffered a setback 14 years ago, Schiano said, when the New York City Off-Track Betting Corp. closed all of its betting parlors as part of its liquidation. That meant New York City Democrats no longer cared as much about OTB operations there or elsewhere in the state.

“Politics comes into a lot of things,” he said.

Rodriguez-Dabney said once she’s fully studied the issue she hopes to meet with Hamburg Gaming to convince them to approve more E-Z Bet applications in Buffalo. And if that fails? It’s off to Albany.

“As soon as I’m well-versed on everything,” she said, “I plan to talk to as many people as possible about it so that the City of Buffalo is well represented and small businesses can take advantage of it.”

Investigative Post

Get our newsletters delivered to your inbox * indicates required

Newsletters *