Gov. Spitzer plans new racing bid format

February 27, 2007

Governor wins support of Bruno, Silver for revamped review process of offers to run state franchise

By JAMES M. ODATO, Capitol bureau
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ALBANY -- Gov. Eliot Spitzer plans to announce a new public review process to consider bids for the state horse racing franchise.

Assembly Speaker Sheldon Silver, D-Manhattan, and Senate Majority Leader Joseph L. Bruno, R-Brunswick, supported the additional analysis. Bruno said it may make sense to have all bids worked into one ideal proposal.

The remarks follow last week's report by the nine-member Ad Hoc Committee on the Future of Racing, which included three members each appointed by Bruno, Silver and Gov. George Pataki.

The committee recommended Excelsior Racing Associates as the preferred bidder. That group includes New York Yankees executive Steve Swindal, casino developer Richard Fields and former racing and wagering board chairman Jerry Bilinski.

"There will be a process that will be open, that will permit full public review of what has occurred, and we will get quickly to the right decision," said Spitzer. "It will be a process that will let the right questions be asked. It is a major industry that should be jump-started in this state.'

Bruno said the report will be subject to public hearings, but Spitzer said a hearing may be too formal a process. "There will be a public opportunity for everybody to be asked questions and to participate," the governor said.

Bruno said he is open to all the bidders -- a total of four, including current franchise holder New York Racing Association.

"I believe you can mix and match the best of what people have to offer to see if we can improve on whatever's there," he said. "Having the best racing in the world is really what's important."

Silver said Spitzer is expected to talk to all the bidders.

"He's going to have to live with the next franchisee," he said. "I support him making the determination."

Saratoga Springs Mayor Valerie Keehn, a member of the ad hoc committee, said the Legislature and Spitzer should take Excelsior's bid seriously.

"I'm hoping and expecting . . . not starting the whole process over again, to build on our foundation," she said. . .

Like Ilitch, Atlanta Braves owner wants to retain MLB Team & gambling enterprise; an on line sports betting information Website.

Published on: 02/23/07

MLB looking into Liberty betting site

By TIM TUCKER
The Atlanta Journal-Constitution

Prospective Braves buyer Liberty Media's ownership of a sports betting-information Web site has drawn the attention of Major League Baseball.

"Our people are looking into it," MLB spokesman Rich Levin told The Journal-Constitution on Thursday. "They are aware of it and are reviewing it."

Liberty last year bought a 51 percent stake in Toronto-based Fun Technologies, whose holdings include a Web site called DonBest.com. The site, which doesn't accept or make wagers, provides gambling lines and extensive picks from "expert" handicappers.

Levin said MLB's "basic rule is that an owner or anybody can't have any direct involvement in any kind of gambling enterprise." He said he did not want to "make a judgment" about whether Liberty's Web site would be found to violate that rule.

If MLB does deem the Web site a problem, it could ask Liberty to divest that business, which is a tiny part of the company's overall holdings, as a condition of being approved as Braves owner.

Liberty Media CEO Greg Maffei said at an investment conference in Colorado that the Web site should not present a problem with MLB.

"It does no more, no less than USA Today or lots of other people who provide much more information in much more detail," Maffei told The Rocky Mountain News after a speech at the "Venture Capital in the Rockies" conference in Beaver Creek, Colo. "I don't see it as an issue."

Steve Greenberg, the investment banker representing Time Warner on the Braves deal, declined comment when asked if he expects the Web site to be an issue with MLB.

Time Warner and Colorado-based Liberty last week agreed on a tax-free stock swap under which Liberty would acquire the Braves. The deal was forwarded to MLB for what is expected to be a lengthy examination; the process typically includes looking at a buyer's businesses. Approval is required from 75 percent of owners.

Issues of ownership ties to gambling-related entities have surfaced twice recently in baseball. MLB blessed an arrangement under which Marian Ilitch, wife of Detroit Tigers owner Michael Ilitch, owns MotorCity Casino in Detroit. And Steve Swindal, a managing general partner of the New York Yankees and son-in-law of principal owner George Steinbrenner, was quoted by the New York Times in December as saying he got permission from baseball commissioner Bud Selig to participate in a group bidding for three New York horse racing tracks, one of which would operate slot machines.

According to a recent press release, the Don Best site "provides subscription services for live odds, major line-move alerts, injury reports, statistical reports and offers customized information-

delivery services."

At the conference, Maffei also addressed speculation Liberty would quickly re-sell the Braves, saying, according to the Rocky Mountain News, that the company intends to be "long-term owners."

The paper reported that he told the gathering of venture capitalists that there are "lots of reasons" to hold on to the team, one being that "you're not going to make a lot of friends" in MLB by quickly flipping it. Also, he noted the IRS would treat the deal more favorably if Liberty keeps the team.

But it was not clear what Maffei meant by "long-term" — the two or three years experts have said Liberty must hold the Braves to preserve the deal's tax-free status, or something significantly longer. He could not be reached for further comment.

Boston Globe weighs in on Baseball and Slot Machines

02.04.07
Hill Climber in Chicago



Don't bet on Swindal's inclusion


Pull the lever, line up three A-Rods, and you win $252 million.

Far-fetched? Of course it is, but if commissioner Bud Selig doesn't rule against Yankees president Steve Swindal's interest in Excelsior, which is vying for control of three New York racetracks and eyeing the inclusion of video slot machines, you might as well allow slots at the new Yankee Stadium...

...Baseball doesn't mind its owners having stakes in horses or racetracks, and we're well aware of [Steve] Swindal's father-in-law, George Steinbrenner, and his love of horses. Gambling is the problem.

The commissioner's office has long indicated it will evaluate potential ties to gambling on a case-by-case basis, but as of Friday Major League Baseball spokesman Patrick Courtney said Selig had not yet ruled.

In October, Robert Nutting, a Pittsburgh Pirates partner, removed slots from consideration at his Seven Springs Mountain resort in the Catskills when told Selig would not have approved. But apparently there is a way around it, and Detroit Tigers owner Mike Ilitch has learned it -- have your wife own the casino. In that case, Marian Ilitch is owner of the Motor City Casino. Nutting, however, wasn't able to pull it off because it would have created a major structural change in his stake of the Pirates.


Our most educated guess is that Swindal doesn't have a chance of being part of this. But who knows?

New York Times sports writer recognizes conflicts in Ilitch casino ownership

December 26, 2006

On Baseball
A Marriage Is a Partnership, Except in Baseball



By MURRAY CHASS

On the Ilitch Holdings Web site, Marian Ilitch is listed as the company’s vice chairwoman. Among the 15 “companies and venues” listed and described are the Detroit Tigers. A visitor to the site could easily conclude that Marian Ilitch is an officer, if not an owner, of the Tigers and the other 14 ”companies and venues” listed under her name and that of her husband, Michael.

MotorCity Casino is not among those companies and venues. Marian Ilitch owns and operates MotorCity Casino. Under Major League Baseball rules, an owner or officer of a club cannot own or operate a casino. So why does M.L.B. allow Marian Ilitch to own and operate the Detroit casino? Because the Ilitches have assured M.L.B. that Marian Ilitch is not an owner or an officer of the Tigers, the Ilitch Web site notwithstanding.

Michael owns the Tigers; Marian owns the casino. That’s their story, and they’re sticking to it.

The Ilitches don’t talk to reporters. They have not returned telephone calls seeking comment on their baseball and gambling ownership status, nor has the vice president for communications at Ilitch Holdings Inc., Karen Cullen.

Baseball officials, on the other hand, have recently addressed the issue.

“Mike has no ownership interest in the casino, and Marian has no ownership interest in the club,” Bob DuPuy, baseball’s chief operating officer, said Friday. “We don’t have a rule that covers spouses. Since these entities are separate, we don’t deem it a violation.”

DuPuy said that when Marian Ilitch was listed as a director and an officer of the Tigers, “we asked that it be modified and it was.”

What about the Web site listing? “I don’t think she has any direct involvement with the Tigers,” DuPuy said. “My recollection is she divorced herself of any involvement with the Tigers, and we were satisfied with that.”

Tom Ostertag, baseball’s general counsel, echoed DuPuy’s view.

“The annual ownership reports filed by the Tigers clearly indicate that Michael Ilitch owns 100 percent of the club and that Marian Ilitch is not among the club’s officers, directors or employees,” Ostertag said.

The subject of baseball and casinos has arisen because Steve Swindal, a managing general partner of the Yankees, is a partner in a group that may operate three racetracks in New York State and have slot machines at one of them. Bob Nutting, chairman and plurality owner of the Pittsburgh Pirates, had also wanted to install slot machines at a Pennsylvania ski resort he owns.

Nutting abandoned his plan because he did not think he would be able to find a way around baseball’s rules.

Swindal’s and Nutting’s efforts prompted another look at the Ilitch operation. Technically and legally it may be free of any casino smell, but signs remain that a link exists, including the listing of Marian Ilitch as second in command of Ilitch Holdings.

If she is vice chairwoman of the company, and the Tigers are part of the company, how is she not part of the Tigers ownership or at least their executive group?

Michael Ilitch is chairman of Ilitch Holdings, and he is the owner of the Tigers. Christopher Ilitch is president and chief executive of Ilitch Holdings, and his page in the Tigers’ media guide is second only after his father’s. His biography mentions some of the entities included in the company.

Christopher was involved in a casino matter last year when he and Mike Malik, a partner with Marian Ilitch in a casino venture, were the hosts for a $5,000-a-head fund-raiser in the owner’s box at Comerica Park. The event was for Representative Richard Pombo, Republican of California, whose House Resources Committee was scheduled to take up a bill affecting her casino project.

Marian Ilitch is not considered an owner or officer of the Tigers, yet she is an owner or officer of other Ilitch entities like Little Caesars Pizza, the Detroit Red Wings, Olympia Entertainment, Uptown Entertainment and the Fox Theater.

In the first five years of Michael Ilitch’s ownership of the Tigers, the team’s media guides listed his wife as an owner as well. In 1997, Dun & Bradstreet listed her as a team executive, secretary and treasurer. But when she became involved in the casino project that year, she denied having been an owner. Commissioner Bud Selig supported her position.

In April 2005, Westlake Securities of Austin, Tex., announced the $106.4 million sale of Atwater Entertainment Associates’ minority interest in MotorCity Casino to Ilitch Holdings. Westlake said Ilitch Holdings “also bought the remaining equity in the holding company including the controlling interest owned by Mandalay Bay Group prior to its merger with MGM Mirage Resorts.”

Westlake’s release later referred to Ilitch Holdings as “another minority interest shareholder of MotorCity Casino.” The release didn’t say that Marian Ilitch bought the casino or was a minority shareholder in the casino. It said Ilitch Holdings was a shareholder and bought the casino. Where was baseball then?

Yet her biography on the Ilitch Holdings Web site says “Marian purchased the MotorCity Casino in Detroit in April 2005.” Westlake evidently wasn’t in on that deal.

Baseball seems to have ignored the casino transaction the way it has ignored other Tigers transgressions. The Tigers seem to get a pass from Selig. In 1990, he issued guidelines dealing with interviews of minority candidates for decision-making positions. But when the Tigers hired Phil Garner as manager in 1999, they interviewed no minority prospects and Selig did not discipline them.

The Tigers bought their way out of a penalty by establishing a community program involving minorities. The fact that the Tigers repeated the act last year when they hired Jim Leyland, this time conducting sham interviews with two minority candidates knowing they were going to hire Leyland, showed their disregard for Selig’s rules.

Just as the Tigers won the American League pennant under Leyland, Michael Ilitch has also done well — financially — this year. After a year’s absence, he returned to the Forbes list of America’s 400 richest people, his estimated net worth doubling to $1.5 billion from $750 million in 2004.

Matthew Miller, who compiles the Forbes list, declined to provide details of the $1.5 billion estimate but said: “I can tell you the casino holdings are not tremendously significant to the 1.5 number. We have heeded what he has said to a degree that he doesn’t own it.”

Forbes, however, does not have to oversee the enforcement of baseball’s rules. It can accept “to a degree” Ilitch’s story without concern for its absolute veracity. Baseball cannot afford that latitude.

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You may also want to review these posts:

The Verifiable Truth: Detroit Tigers owner doubled his net worth gambling on casinos
The Verifiable Truth: Notice of $625 million MotorCity offering lead by Deutsche Bank and Merrill Lynch states, Marian Ilitch is co-owner of the Detroit Tigers
The Verifiable Truth: Baseball and Casinos Don’t Mix, or Do They?

Baseball and Casinos Don’t Mix, or Do They?

What’s good for the goose is supposed to be good for the gander, but in this case, who is the goose and who is the gander?

12.19.09
The New York Times

by MURRAY CHASS

Steve Swindal, a managing general partner of the Yankees, has other business interests outside of baseball. That’s where the slot machines come in... Swindal...George Steinbrenner’s son-in-law...Marian Ilitch...listed as an owner in the team’s media guide...first five years of the family’s ownership...name disappeared from the guide when the Ilitch casino was on the horizon... arrangement has raised some eyebrows among some baseball people, but Selig has sanctioned it. (FULL STORY)

You may also want to review these posts:

The Verifiable Truth: Detroit Tigers owner doubled his net worth gambling on casinos
The Verifiable Truth: New York Times sports writer recognizes conflicts in Ilitch casino ownership