NEW YORK (Reuters) - The board of New York City's bankrupt Off-Track Betting Corporation voted on Saturday to continue operations for another year, just one day before a scheduled shutdown of the horse racing gambling parlors.
OTB Chairman Sandy Frucher said Governor David Paterson and leaders of the state legislature have agreed to an interim plan to keep OTB going for a year and prevent, at least temporarily, some 1,300 expected layoffs.
The legislature has not yet voted on the plan for the bankrupt state-owned agency, which takes in about $1 billion in bets a year.
"Earlier this week there was a three-way agreement among leaders of the Assembly, State Senate and the Executive Chamber on at least an interim package for New York City OTB that would grant temporary relief," Frucher told an emergency meeting where the board voted to keep the parlors open.
"While the legislation was said to have been agreed upon on a three-way basis, the legislature did not take action on a bill," he added.
Several steps would help OTB during interim operations, Frucher said, including closing more than half of its locations, deferring subsidy payments to the horse racing industry and paying market rates to tracks for their races.
OTB was set up in the 1970s to raise money from pari-mutuel betting and drive organized crime out of gambling on horse races.
The corporation has struggled for years with rising deficits and falling revenue. The state, city and horse racing industry all get a share of its gross wagers, consuming much of its income, and OTB has asked for legislative changes to turn its business around.
OTB made a rare Chapter 9 filing in December, using the part of the U.S. bankruptcy code that applies to municipalities.
The move came after years of operating deficits amid declining betting revenue and high overheads at shabby parlors in dire need of renovation and modernization.
The New York Racing Association Inc, the New York Thoroughbred Horsemen's Association Inc and the New York Thoroughbred Breeders Inc all opposed the Chapter 9 filing, which allows OTB to reorganize without being forced into liquidation.
(Reporting by Chris Michaud; Editing by Eric Beech)