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OTB's Financial Troubles Call Attention to Fleet Use

September 10, 2009

New York City Off-Track Betting Corporation is in financial trouble, and an audit is questioning whether the expense of its 87-vehicle fleet is necessary, reports The New York Times.

On Tuesday, Gov. David A. Paterson issued an executive order authorizing the government-controlled betting operation, which ended last year with a $17.8 million deficit, to file for bankruptcy protection.

While some of OTB's problems are beyond its control, a recent audit by the state comptroller, Thomas P. DiNapoli, questioned whether so many vehicles were necessary to care for 68 betting parlors. Its vehicles cost an estimated $6,700 each per year to operate.

Much of its fleet is aged, and vehicle use is not high. One OTB vehicle, a 2004 Ford van, averaged 2,500 miles a year; a 1996 model averaged less than 4,000 miles annually. Four 2003 Dodge Ram pickup trucks were driven an average of about 10,000 miles a year.

Fifty employees are allowed to use official cars for commuting. According to Raymond V. Casey, the organization's executive director, letting officials take the cars home at night saves OTB the cost of expensive overnight parking near its headquarters in Times Square.

The audit also questioned why 22 executives required cars at their disposal.

Casey did not dispute the finding that fewer cars were needed. He said he had sharply reduced the fleet since becoming director in 2001 and had ordered an additional 12 vehicles to be sold after seeing a draft of the audit. He also created a vehicle-sharing system for executives.

Cutting back on the use of vehicles is unlikely to solve OTB's larger financial problems. Casey said this is because OTB is required to pay the horse racing industry and the state before covering its own expenses.

Employing three automotive mechanics, seven drivers and a motor vehicle supervisor, as well as expenses for gas, insurance and outside repairs add up to over $1 million per year in costs.

According to The New York Times, appropriate fleet size for an organization like OTB is hard to determine. However, the State Department of Taxation and Finance, with 89 vehicles, has a similar fleet but a much more sweeping mission, including inspecting retail businesses and cigarette sellers across the state. Of its fleet, 82 cars are available to investigators, and none are assigned to executives, said Thomas Bergin, a tax department spokesman.

 

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