A Long Island official is demanding the state Legislature investigate the Suffolk County OTB’s controversial $120 million purchase of a popular Long Island casino — from a company with close ties to Gov. Hochul.
Suffolk Off-Track Betting shelled out the big bucks to both own and manage Jake’s 58 Hotel and Casino to the Buffalo-based Delaware North, a firm that employs Hochul’s husband William as a senior vice president and its general counsel.
The connection to Delaware North has had Hochul under fire from good-government groups over potential conflict of interest issues, since she gets to choose who leads the state Gaming Commission, which regulates betting facilities like Jake’s 58 statewide.
Suffolk County Executive Steve Bellone, who is pushing the probe, claims the deal was cut in secrecy and could create a massive patronage mill.
In a letter sent Friday to Sen. Majority Leader Andrea Stewart-Cousins (D-Yonkers) and Assembly Speaker Carl Heastie (D-Bronx), Bellone accused Suffolk OTB of avoiding public scrutiny by refusing to turn over copies of its contract to buy the Islandia, L.I. video-gaming casino in May.
“Now without the oversight and management of a professional casino operator, Jake’s 58 Hotel and Casino, where hundreds of millions are wagered through its doors each month, is poised to become one of the largest political patronage operations in the State, if not the country,” said Bellone in the letter obtained by The Post. “At minimum, these troublesome actions are a signal of fiscal impropriety – and perhaps much worse.
“Given the current circumstances, I am requesting that the State Senate and/or Assembly move to conduct a formal investigation, as this may be our best hope to bring transparency to an agency that thrives by operating in the shadows.”
Bellone also attached with his letter a copy of federal court papers from a lawsuit between OTB and Delaware North, he said alleges “a culture of shameless nepotism among Suffolk OTB leadership.” He is demanding legislative reform to improve transparency throughout the OTB system and similar public entities.
Suffolk OTB, public benefit corporation that oversees any local video-gaming action, said it purchased the casino-hotel in a bid to save about $13 million a year in rental and management fees it previously paid to Delaware North, which had a 50-year contract to manage the casino for the formerly bankrupt betting agency.
Bellone, a Democrat, has long been at odds with Suffolk Democratic Party Chairman Richard Schaffer, who controls most local OTB board member appointments.
State Comptroller Thomas DiNapoli, who has the power to audit, is also reviewing a similar request Bellone made last month.
Suffolk OTB President and CEO Jim LaCarrubba called the casino deal “great,” estimating it will help provide a “record $20 million-plus” to Bellone’s current county budget and “will be even more successful in 2022.”
“As a result of our efforts, Suffolk OTB is the most successful OTB in the state and [is] providing record revenue to New York State as well as Suffolk County,” he said.