BATAVIA — The operating plan, or budget, Western Regional Off-Track Betting (WROTB) Corporation will have for next year is not done. Numbers will change, officials said, but as of Wednesday, the corporation was projecting an estimated $11 million in profit, though a lot of that will be distributed among the 15 member counties and the cities of Buffalo and Rochester.
“These are not the final numbers. This is still a work in progress,” Chief Financial Officer Jacquelyne Leach said of the preliminary plan for 2023, which was presented Wednesday to the board. “The board, ultimately, will vote to approve or disapprove the recommendations of management. That really will come to fruition in the final plan (for 2023) that will be sent out … to members next week.”
Leach said the plan is a collective effort between officers, department heads and staff.
“Out of today, through discussion with the Board of Directors, next week, we will send out what we feel are our final plan numbers to our board members,” Leach said. “You will come back at the Nov. 30-Dec. 1 board meeting and hopefully have a level of confidence that you feel ready to approve the final plan for 2023.”
Leach noted WROTB is a public benefit corporation, but not a taxing authority.
“We do not levy taxes. The revenues that are provided in here are really based on historical and current trends.
“Keep in mind, those two revenue sources, which is the pari-mutuel wagering and the video gaming activity, is based on our patrons,” she said. Pari-mutuel betting is also known as pool betting. It involves wagering against other bettors who have placed wagers on the same event.
WROTB and Batavia Downs President and CEO Henry Wojtaszek said after the meeting that the majority of that is distributed to member municipalities.
Regarding the Batavia Downs, the hotel’s bottom line for 2023 was increased by about $12,000 and revenue by about $20,000, Leach said.
Board member Dennis Bassett, representing Rochester, asked what else is taken into consideration when forming the operating plan.
“Was there any additional guidance that you gave the departments? Are we in a position where we want to stretch our sales, be reasonably conservative, or do you just use the historical and the current trends?” he asked. “If that’s the case, that’s OK. I just want to know whether there was any additional guidance.”
Leach said there was additional guidance.
“Obviously, what comes into play there are, ‘What are your anticipated capital expenditures for the next year? What do you want to achieve?’ ” she said. For example, there is a potential analytical software tool that upper management wants to talk to the board about, Leach said, that could help WROTB react to patrons’ spending habits and how it could capitalize on them.
“Obviously, what’s going on in the economic environment in which we’re all living,” Leach said of another factor in putting the plan together. “How do we deal with inflation here? We had to bring that into play. It’s rather difficult to maneuver around in that climate because I don’t think anyone really knows what’s going to happen there …”
That has led WROTB to increase some of its projected expenses, such as utilities or the cost of goods and food costs, she said.
“Costs to sales, we’ve had to adjust that. Conversely, forecast what are our increase in what our increases in our food, our product to the end user, the patrons, the customers,” she said. “There’s a lot that goes into putting this plan together. How do we achieve, let’s say, our net win goals for next year.”
Based on current trends and where WROTB was going, from when it put together the preliminary operating plan until now, there was an opportunity to increase the net handle by about $851,000 for 2023.
“Generally speaking, the corporation retains between 20% and 21% of the net handle,” Leach said. “On a dollar wagered, about 75 cents goes back to the patron. You’ve got 5% that’s dedicated to your surcharge revenues that pass on to the municipalities. The corporation is left with about 20 cents after the monies are returned to the patrons and the surcharge going to the municipalities. Then, out of that 20 cents, about 10% gets paid out in statutory payments. Statutory payments are anything that would go to the host tracks, and their host fees, to the breeders’ funds, to the New York state Gaming Commission, to New York state, in the form of a pari-mutuel tax. There’s not much left over. There’s like 10 cents on that dollar that’s left over for which the corporation can then pay its operating expenses.”
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