Hospitality industry giant Delaware North dropped its bid today operate the Aqueduct racino, citing unfavorable business conditions and Albany’s volatile politics and unpredictable taxing policies, sources said today.
Delaware North had joined forces with Saratoga Gaming in prior efforts to operate the often-delayed, scandal-scarred Aqueduct slots project.
Delaware North actually was awarded the Aqueduct franchise in 2008, but failed to cough up the $370 million up front license to the state. It cited a required $300 million potentially non-refundable license fee as one of the reasons not to leave the starting gate.
The firm also questioned whether cash-starved Albany would provide a promised $250 million capital construction grant to help build the slots casino.
“A highly unusual set of financial conditions, including the non-refundability of down payment and unpredictability of state taxation rates, caused us to reevaluate the project and ultimately decide against participation,” DN said in a statement.
Delaware North also inferred that the value of the Aqueduct franchise has diminished because the Long-Island-based Shinnecock tribe plans to open a full-fledge casino in the Nassau-Suffolk, potentially siphoning away customers. There’s also talk of opening state-sanctioned slot machines at nearby Belmont race track, the firm said.
Gov. Paterson and the Legislature’s surprise decision to raid revenues of existing upstate racino revenues to help solve the state’s fiscal crisis also dampened DN’s enthusiasm for the project, sources said.
Bids for the Aqueduct project are due today.