Paterson: There Was Consensus on Aqueduct; AEG Has the Money

aeg Paterson: There Was Consensus on Aqueduct; AEG Has the MoneyFacing increasing criticism for selecting a politically-connected bidder to develop slot machines at the Aqueduct race track, Governor Paterson released a statement Thursday afternoon stressing that legislative leaders had agreed on the choice.

The statement appeared to be a riposte at Assembly Speaker Sheldon Silver, who Friday stated a list of conditions (and sent a letter reiterating the point yesterday) that the bidder, Aqueduct Entertainment Group, must meet before he will sign off on the bid. [Clarified]

Here’s Paterson’s statement, which references the up-front financial demand (a $300 million payment to the state), and asserts that AEG can meet it. 

“AEG was selected to operate video lottery terminals at Aqueduct racetrack in a unanimous decision reached through the equal votes of the leader of the Senate, the Speaker of the Assembly, and myself. Each leader had equal statutory authority, equal responsibility and is equally accountable in this selection.

“AEG has both the financial viability and ability to pay the required upfront licensing fee. AEG complied with every request made during the review process and addressed satisfactorily all matters related to licensability. AEG’s compensation to the State, both in the short term and the long term put it near the top or at the top compared to other bidders. Further, AEG’s gaming operator, Navegante, has a verifiable record for establishing successful gaming operations. AEG’s plan fits well within the very diverse and middle class community that exists around Aqueduct and its approach to operations will attract local community members to the site in the largest numbers and create local jobs for people in the surrounding area. AEG’s commitment to diversity and inclusion was also an important consideration in choosing it to operate at Aqueduct.

“All information about the bidders and their bids was presented to all involved parties as we weighed this selection. After a lengthy evaluation process, I can only assume that the other leaders made their decision, as I did, because AEG offered the bid that received both unanimous support and is good for New York.”

The governor has been relatively candid about the fact that he preferred another bidder (reportedly an SL Green-led team), but faced deadlock, as the State Senate leader, John Sampson, reportedly pushed AEG. On AEG’s team is Rev. Floyd Flake, the former Queens Congressman who is close to state Senate President Malcolm Smith. Days before the selection, Mr. Flake suggested to the Times that he might endorse a gubernatorial run by Andrew Cuomo. Paterson, who already faces a significant financial disadvantage, would be greatly wounded if black Democratic leaders abandoned his candidacy to support Mr. Cuomo. (Paterson later met with Flake, after the selection, though the administration denied an endorsement was discussed). 

Also this afternoon, AEG issued a statement that seemed to try to move the discussion forward, saying they were now looking to finalize the deal with the state. The press release had a quote from the president of the influential Building Trades union lobby, Gary La Barbera, endorsing the selection.

“We are committed to complying with every condition set by the State and assuring the people of New York that we will be a great partner for years to come.  We look forward to completing the Memorandum of Understanding as quickly as possible and starting construction,” said Jeff Levine, a developer and a member of AEG.

ebrown@observer.com