Watchdogs Urge Comptroller DiNapoli to Conduct Full Audit of All Aspects of Troubled Western OTB
Three government watchdogs sent a letter to Comptroller DiNapoli requesting a full audit of Western Regional Off-Track Betting (“Western OTB”), the Buffalo/Rochester-area public corporation overseeing tens of millions of dollars in local gambling.
The letter noted that Western OTB is under intense public scrutiny because of a politicized hiring process and large pay package for the incoming CEO, the former mayor of Buffalo, and has previously been investigated by state authorities and the FBI for basic management failures and self dealing, including use of take-home vehicles and golden parachutes by the previous board and management team.
More recently, Western OTB has been criticized for hiring former Mayor Buffalo Brown, who has a starting salary of $295,000 despite overseeing an operating budget of only $53 million. Leaders at other agencies such as the MTA, which has an operating budget of $19.3 billion, earn $400,999.
The letter is here and below.
November 22, 2024
VIA EMAIL
Thomas DiNapoli
New York State Comptroller
Re: Request for comprehensive audit of Western Regional Off-Track Betting Corporation
Dear Comptroller DiNapoli,
We appreciate the years of work you and your staff have devoted to making New York State and local government spending more transparent and accountable to the public.
We write today to request that you conduct and publish a comprehensive audit of all aspects of Western OTB’s activities including revenue and expenses, procurement, investment, management systems, governance, and public transparency and accountability. Additionally, we ask that your audit answer basic questions about the public benefit provided by Western OTB. The public should know if the economics of the authority make sense. For instance, what net financial return is provided to local governments by horse racing revenue streams versus Video Lottery Terminals and casino gaming? How much are transfer payments to local governments really worth after the cost of tax abatements and other subsidies are subtracted?
We are aware that OSC’s Division of Local Government and School Accountability (LGSA) audited the Western OTB marketing program and use of take-home vehicles in 2021. We are also aware that OTB was extensively investigated by state and federal authorities for misconduct by members of the board of directors. However, we are asking your office to take a top-to-bottom look at Western OTB that answers fundamental questions about the public benefit provided by Western OTB, the board’s fulfillment of its fiduciary duty and independence from partisan political considerations that directly affect hiring, procurement, and spending decisions.
We draw your attention to a steady stream of news stories about government officials exploiting Western OTB – a public authority – to benefit themselves, family members, and political confidantes. We hope you share our concern about the golden parachutes for departing executives, nepotistic hiring, and an outsize salary for the incoming CEO (please see attached summary). We also note that Senator Ryan and Assemblymember Wallace, whose districts include some of Western OTB’s operations, wrote the Attorney General and Inspector General and provided details of other impropriety and poor governance which we have included below.
We have grave concerns about Western OTB and appreciate your office helping to restore public trust in this historically troubled unit of government.
Sincerely,
John Kaehny
Executive Director
Reinvent Albany
Susan Lerner
Executive Director
Common Cause New York
Erica Smitka
Executive Director
League of Women Voters of New York State