A firm tentatively hired last week by the New York Racing Association will likely have to bid again for its contract because of a list of complaints state regulators had with the procurement process.
The state’s Franchise Oversight Board has submitted a memorandum to NYRA that describes the hiring of Global Betting Exchange to improve NYRA’s online wagering as unjustified. NYRA failed to follow its approved procedures when it searched for a firm to make the improvements, sending out a request for quotes that lacked minimum qualifications, had open-ended terms and failed to identify criteria that would be used to judge bids, according to the memorandum.
Additionally, state regulators faulted NYRA for disqualifying bidders, despite not having minimum qualifications, and for initially disqualifying Global Betting Exchange — only to later identify them as the only firm capable of meeting its online needs and awarding the contract without a new bidding process.
Based on these concerns, Franchise Oversight Board Chairman Robert Williams wrote, “It is not feasible to award the contract to [Global Betting Exchange].”
The contract was approved at a NYRA board meeting Monday, but it was agreed a new bidding process may be necessary, pending a review of written complaints from the Franchise Oversight Board. After receiving the memorandum with the complaints, NYRA spokesman Eric Wing said the organization would likely rebid the contract.
If the process is not completed quickly, as much as $5 million in fourth-quarter revenue could be in jeopardy, as NYRA anticipated additional revenue from improvements in online wagering that would be made by Global Betting Exchange.
At Monday’s meeting, Ben Liebman, a key racing advisor to the governor, tried to assure the NYRA board that a firm could be hired soon and upgrades made quickly. He said a new bid could be approved quickly by the state’s Gaming Commission. Noting that the Gaming Commission currently has no board members, a chorus of NYRA board members responded, “There is no Gaming Commission.”
A new bidding process would also be an indictment of NYRA’s audit committee, which reviewed and approved the process of selecting Global Betting Exchange. NYRA board member Charles Wait, who serves on the audit committee, defended NYRA’s selection of Global Betting Exchange on Monday, noting the committee met with losing bidders and none raised any concerns with the process.
Liebman responded, “You have a flawed process.”
The memorandum of complaints was obtained by the Gazette from state regulators. NYRA has not publicized the document, despite a pledge last week by NYRA board Chairman David Skorton that the state’s complaints would be an “open public document.” The memorandum has not been posted on NYRA’s website and a request for the document by the Gazette was denied.
Wing said it wouldn’t be appropriate to release the memorandum considering some information on it could contain trade secrets.
State Committee on Open Government Director Robert Freeman, who trained some of NYRA’s management on Open Meetings and Freedom of Information law issues, said the existence of trade secrets should not prevent the disclosure of a document. He said the Freedom of Information Law would allow portions of a document to be redacted if there are trade secrets involved, but stressed “the remainder should be disclosed.”
This isn’t NYRA’s only recent problem with transparency, according to Freeman, who said recent committee meetings have not followed the Open Meetings Law. There have been no public notices designating the time or place of recent committee meetings, with the only acknowledgement they even occurred coming during public discussions at NYRA board meetings.
In a February interview with the Gazette, Skorton said the requirements of the Open Meetings Law was something board members were still learning.