STATE OF NEW YORK. SUPREME COURT : COUNTY OF ALBANY FINGER LAKES RACING ASSOCIATION, INC., Petitioner, vs. IndexNo: /Q3S-/s~ NEW YORK STATE GAMING FACILITY LOCATION BOARD, NEW YORK STATE GAMING COMMISSION, WILMORITE, INC., WHITETAIL 414, LLC, LAGO RESORT & CASINO, LLC, WILMOT GAMING, LLC, and PGP CASNO-LLCN Albany County Clerk Document Number 11782638 Revd 03/06/2015 4:30:20 PM Respondents. ‘Acca NOTICE OF PETITION TO THE ABOVE-NAMED RESPONDENTS: PLEASE TAKE NOTICE that upon the annexed Verified Petition Petitioner herein, FINGER LAKES RACING ASSOCIATION, INC., verified thél6th day of S = March, 2015, the undersigned will make an application before a Justice of the SupreméCourt = presiding at Special Term at the Albany County Supreme Court, 16 Eagle Street, Albany, New York, on the 17th day of April, 2015 at 9:30 am., or as soon thereafter as counsel can be heard, for a judgment pursuant to Article 78 of the Civil Practice Laws and Rules (1) annulling that part of the New York Gaming Facility Location Board’s determination that rendered the Lago Resort & Casino eligible for a gaming license from the New York State Gaming Commission, (2) granting a preliminary and permanent injunction enjoining the New York State Gaming‘Commission from issuing a gaming license to Respondents Wilmorite, Inc., Whitetail 414, LLC, Lago Resort & Casino, LLC, Wilmot Gaming, LLC, and PGP Investors, LLC; and (3) granting such other and further relief as to the court may seem just and proper, with the costs and disbursements of this proceeding. PLEASE TAKE FURTHER NOTICE, that a verified answer, certified record of proceedings, and supporting affidavits, if any, must be served at least five (5) days before the return date of this application. PLEASE TAKE FURTHER NOTICE, that Petitioner is hereby requesting oral argument on the Verified Petition. Dated: March 6, 2015 Albany, New York HODGSON RUSS LLP Attorneys for Petitioner / J Merola, Esq. Charles W. Malcomb, Esq. 677 Broadway, Suite 301 Albany, New York 12207 (518) 465-2333,STATE OF NEW YORK. SUPREME COURT : COUNTY OF ALBANY, FINGER LAKES RACING ASSOCIATION, INC., Petitioner, vs. Index No.: NEW YORK STATE GAMING FACILITY LOCATION BOARD, NEW YORK STATE GAMING COMMISSION, WILMORITE, INC., WHITETAIL 414, LLC, LAGO RESORT & CASINO, LLC, WILMOT GAMING, LLC, and PGP INVESTORS, LLC, Respondents. ‘ERIFIED PETITIO! Petitioner FINGER LAKES RACING ASSOCIATION, INC., by and through its attorneys, Hodgson Russ LLP, for its Verified Petition, respectfully alleges as follows: PRELIMINARY STATEMENT 1. Petitioner Finger Lakes Racing Association, Inc. (“Finger Lakes”) commences this Article 78 proceeding challenging Respondent New York State Gaming Facility Location Board's (the “Location Board” or the “Board”) arbitrary determination that the Lago Resort & Casino in the Town of Tyre is eligible for a gaming license from the New York State Gaming Commission (the “Commission”). 2. Under the New York Racing, Pari-Mutuel Wagering, and Breeding Law (“PML”), the Board is charged with selecting the locations for up to four new upstate New Yorkcasino-style gaming facilities. In carrying out its duties, the Board must ensure that locations are chosen that will boost economic development, provide new jobs, and provide additional revenue to the State. ‘The Legislature thus mandated that the Board consider and weigh numerous factors to ensure that these facilities generate new gaming revenue by drawing downstate residents and non-New York residents upstate and capturing spending that would otherwise go to out-of-state facilities, rather than merely cannibalizing revenue and jobs from existing upstate gaming facilities. 3. Inselecting the Tyre location, the Board failed to apply the statutorily required factors uniformly, resulting in a strikingly inconsistent and contradictory decision. For example, the Board categorically excluded 6 of 9 applications in the Catskills/Hudson Valley region, finding that these proposed facilities would cannibalize revenues from existing gaming locales sixty to seventy miles away in the heavily populated New York City metropolitan region. But, in selecting the Lago Resort & Casino, the Board discounted cannibalization, notwithstanding unrebutted evidence that 67% of Lago’s revenues will be taken from existing facilities in a sparsely settled rural region already oversaturated with gaming venues, the largest of which is a mere twenty-five miles away. Allowing extreme cannibalization in this decidedly rural market, while refusing even to consider six applications due to cannibalization in a far larger and less-saturated market, is manifestly arbitrary and capricious, 4. By selecting Tyre, the Location Board is effectively allowing Peter to be robbed to pay Paul — benefits are being redistributed from one community to another, rather than being maximized for the State as a whole, as specifically mandated by the Legislature. The Board has further ignored copious evidence in the administrative record showing negative impacts in terms of jobs and revenue for nearby host communities, which is likewise a statutorilymandated consideration. Accordingly, the Court should enter an Order and Judgment annul the Location Board’s determination that the Lago Resort & Casino is eligible for a gaming license from the State Gaming Commission. PARTIES Petitioner Finger Lakes 5. Petitioner Finger Lakes Racing Association, Inc. d/b/a Finger Lakes Gaming & Race Track is a domestic business corporation, organized under the laws of the State of New York, with a principal office at 40 Fountain Plaza, Buffalo, New York. Finger Lakes was formed for the purpose of conducting racing and pari-mutuel wagering in accordance with Article IT of the New York Racing, Pari-Mutuel Wagering, and Breeding Law (“PML”), 6. Finger Lakes has owned and operated Finger Lakes Gaming and Race Track since the 1960s. Located in the Town of Farmington, Ontario County, near Lake ‘Canandaigua in the scenic Finger Lakes area, the race track and associated operations employ over 550 individuals. An additional 1,194 people are employed locally in the racing and breeding industry as a direct result of Finger Lakes’ business operations. 7. Imaddition to offering live thoroughbred racing from mid-April through carly December, Finger Lakes’ facilities include over 1,500 video lottery gaming terminals (VLTS"), as well as multiple dining and entertainment venues, including a meeting and conference center and a banquet facility. 8. Finger Lakes’ operations are governed primarily by three New York State licenses,9, The first of these is a Thoroughbred Racing License, which was first issued to Finger Lakes in 1962. This license is governed by Article II of the PML and may not be revoked by the State without cause. 10. The second license is a Simulcast License, which was first issued to Finger Lakes in 1984. This license is governed by Article X of the PML and may not be revoked by the State without cause, 11, The third license is a Video Lottery Gaming License, which was first issued to Finger Lakes in 2004. ‘This license is governed by Section 1617-a of the New York Tax Law and may not be revoked by the State without cause, 12. The State Division of Lottery amended Finger Lakes’ Video Lottery Gaming License to permit Finger Lakes to expand its VLT operations from 1,199 to 1,549 terminals. Subsequently, Finger Lakes made a significant capital investment of more than $12 million to expand its operations to the newly authorized limit. 13, Finger Lakes has suffered and will continue to suffer significant injury as the result of the Location Board’s decision deeming the Lago Resort & Casino in the Town of ‘Tyre eligible for a gaming license. ‘The severe rate of cannibalization that will result from construction of the Tyre casino, 25 miles from Finger Lakes” established gaming facility, will significantly reduce Finger Lakes’ gaming revenues, prevent Finger Lakes’ from recouping its capital investments, and endangers the very existence of Finger Lakes’ gaming facility. 14, Finger Lakes and its injury are within the zone of interests of the PML, which reflects an overriding legislative purpose to boost upstate economic development, whileminimizing local impacts, rather than merely cannibalizing current gaming revenue streams and jobs from existing facilities and the communities where they are situated, 15, Instead of merely shifting existing revenue streams to new facilities, the relevant portions of the PML seek to “capitalize on the economic development potential of legalized gambling,” and maximize revenue. PML § 1300(3). The casino siting statute is thus premised on the finding that “four upstate casinos can boost economic development, create thousands of well-paying jobs and provide added revenue to the state.” PML § 1300(4). 16. Economic development is nor boosted, jobs are not created, and revenue is not added to the State through redistribution of existing gaming revenue. The statutory goals and effort is not to slice the pie further, but to grow the pie through maximizing gaming revenue and by “attract[ing] non-New York residents and bring{ing] downstate New Yorkers to upstate.” PML § 1300(6).. 17, Finger Lakes participated in the administrative process by submitting extensive comments and economic impact analyses to the Location Board. See Exhibit 4. Respondents Location Board and Gaming Commission 18, Respondent New York State Gaming Facility Location Board is a State board, created pursuant to PML § 109-a, with the authority to “select ... not more than four gaming facility license applicants.” PML § 109-a(6). The Location Board’s determination selecting applicants for gaming facility licenses fixes a legal relationship and either grants or denies a right; “selectees shall be authorized to receive a gaming facility license, if found suitable by the commission,” while those not selected are determined to be ineligible for a license. Id. ‘The Location Board’s function is to render a final determination of eligibility with respect toprospective applicants for gaming licenses. PML § 1320 (“In determ 1g whether an applicant shall be eligible for a gaming facility license. ..."). The Location Board has met in a number of locations, including Albany County. 19. Respondent New York State Gaming Commission (the “Commission”) is a State body, created within the Executive Department pursuant to PML § 102. The Commission is the body having “general jurisdiction over all gaming activities within the state” and has the power to issue licenses to engage in gaming activity. PML §§ 104(1), (2). Pursuant to PML §§ 109-a and 1320, the Commission ma; sue gaming facility licenses to applicants determined to be eligible by the Location Board. Respondents Wilmorite, Inc., Whitetail 414, LLC, Lago Resort & Casino, LLC, Wilmot Gaming, LLC. and PGP Investors, LLC (collectively “Wilmorite”) 20. Upon information and belief, Respondent Wilmorite, Inc, is a domestic business corporation, organized under the laws of the State of New York, with a principal office at 1265 Scottsville Road, Rochester, New York 14624. 21, Upon information and belief, Respondent Whitetail 414, LLC is a domestic limited liability company, organized under the laws of the State of New York, with a principal office at 1265 Scottsville Road, Rochester, New York 14624. 22, Upon information and belief, Respondent Lago Resort & Casino, LLC is a domestic limited liability company, organized under the laws of the State of New York, with a principal office at 1265 Scottsville Road, Rochester, New York 14624,23. Upon information and belief, Respondent Wilmot Gaming LLC is a domestic limited liability company, organized under the laws of the State of New York, with a principal office at 1265 Scottsville Road, Rochester, New York 14624. 24, Upon information and belief, Respondent PGP Investors, LLC is a limited liability company, organized under the laws of the State of Delaware, with a principal office at 11100 Santa Monica Boulevard, Los Angeles, California 90025, 25. Wilmorite submitted an application for a gaming facility license to the Location Board, and the Location Board made a determination that Wilmorite is eligible to apply to the Commission for a license to operate a gaming facility in the Town of Tyre, New York, a mere 25 miles from Finger Lakes’ gaming faci ty. JURISDICTION AND VENUE 26. Supreme Court has jurisdiction over this proceeding pursuant to Article 78 of the New York Civil Practice Law and Rules (“CPLR”). 27. Venue is proper in Albany County because the Location Board made the determination complained of within the Third Judicial District, which includes Albany County. CPLR §§ 506(b), 7804(b).. FACTUAL BACKGROUND/PROCEDURAL HISTORY Gambling In New York State Existing Gambling Facilities In New York State 28. There are a substantial number of authorized gambling facilities currently operating throughout New York State.29. Among these facilities are nine “racinos” that combine racetracks with VLT operations, including — in addition to the Finger Lakes Racetrack operated by Finger Lakes — the Resorts World Casino in New York City, the Monticello Casino & Raceway in the Catskills, Hamburg Gaming at Buffalo Raceway and the Batavia Downs Gaming, both in Western New York, the Empire City Casino at Yonkers Raceway in Westchester County, Tioga Downs in the Southem Tier, Saratoga Casino and Raceway in the Capital Region, and Vernon Downs in Central New York. 30. There are likewise five tribal class II] and three tribal class II casinos in New York State, including facilities in Allegany, Cayuga, Cattaraugus, Erie, Franklin, Niagara, and Oneida counties. An additional tribal facility is scheduled to be opened in Madison County in late 2015, ‘The State Constitution Is Amended To Authorize Casino-Style Gambling 31. In 2012, Governor Andrew M. Cuomo proposed amending Article I, Section 9 of State constitution to permit authorization of seven casino gambling facilities in addition to gambling already authorized under state law. After being passed by two consecutive Legislatures, the amendment became effective after voters approved it in a November 2013 referendum, ‘The Upstate New York Gaming Economic Development Act 32. On July 30, 2013, Governor Cuomo signed into law the Upstate New York Gaming Economic Development Act (the “Act”). Relevant portions of the Act are codified at Article 13 of the PML. The Act authorizes the creation of four destination resort casinos in upstate New York, with at least one gaming facility located in each of three defined regions ofthe State.' It further establishes a process and specific criteria for selecting the locations for the four casinos. 33. As set forth in PML § 1300, in enacting the Act, the Legislature made fourteen findings, including: 34, (1) New York State is already in the business of gambling with nine video lottery facilities, five tribal class III casinos, and three class Il facilities; (2) New York state has more electronic gaming machines than any state in the Northeast or Mideast; (3) While the gambling already exists throughout the state, the state does not fully capitalize on the economic potential of legalized gambling; (4) The state should authorize four destination resort casinos in upstate New York; (5) Four upstate casinos can boost economic development, create thousands of well-paying jobs and provide added revenue to the state; (6) The upstate tourism industry constitutes a critical component of our state’s economic infrastructure and that four upstate casinos will attract non-New York residents and bring downstate New Yorkers to upstate. (8) Local impact of the casino sites will be considered in the casino evaluation process; pend (14) As thoroughly and pervasively regulated by the state, four upstate casinos will work to the betterment of all New York. ‘The Act directs the Commission to establish the Location Board to perform designated functions, including, among others, issuing requests for applications for gaming facility licenses an suing “detailed findings of fact and conclusions demonstrating the reasons supporting its decision to select applicants for commission licensure.” PML §§ 109-a ‘These are Catskills Hudson Valley (Region One, Zone Two); Capital (Region Two, Zone Two) and Eastern Southern Tier/Finger Lakes (Region Five, Zone Two). PML §§ 1310 and 1311(1).and 1306(7). The Act further sets forth detailed factors that the Location Board must evaluate in selecting applicants. PML §§ 109-a and 1306(7). 35. The Legislature thus instructs the Board to assign a 70% weight to “economic activity and business development factors” (PML § 1320(1)), including: ae (b) maximizing revenues received by the state and localities; (©) providing the highest number of quality jobs in the gaming facility; ae (©) offering the highest and best value to patrons to create a secure and robust gaming market in the region and the state; (f) providing a market analysis detailing the benefits of the site location of the gaming facility and the estimated recapture rate of gaming related spending by residents travelling to an out-of-state facility; ae 36. The Legislature similarly instructs the Board to assign a 20% weight to “local impact and siting factors” (PML § 1320(2)), including: (a) mitigating potential impacts on host and nearby municipalities which might result from development or operation of the gaming facility; (b) gaining public support in the host and nearby municipalities which may be demonstrated through the passage of local laws or public comment received by the board or gaming applicant; 37. Inthis way, the Act does not simply authorize the creation of four additional casino resorts, but enacts a comprehensive scheme to ensure that additional gaming, facilities are sited in a way that maximizes value to the State and local communities, while minimizing adverse local impacts. Rather than merely shifting existing revenue streams to new facilities, the Act seeks to “capitalize on the economic development potential of legalized gambling,” PML § 1300(3), and is premised on the finding that “four upstate casinos can boosteconomic development, create thousands of well-paying jobs and provide added revenue to the state.” PML § 1300(4). 38. ‘The four new casinos are intended to “attract non-New York residents and bring downstate New Yorkers to upstate.” PML § 1300(6). The Legislature thus specifically directed the Location Board to “consider local impact of the casino sites,” PML § 1300(8), and empowered it to “develop criteria... to assess which applications provide the highest and best value to the state, the zone and region in which a gaming facility is to be located.” PML § 1306(3). Moreover, the Board is specifically required to make findings concerning each proposal with respect to the “recapture rate of gaming-related spending by residents travelling to an out-of-state facility,” PML § 1320(1)(f) and “mitigating potential impacts on host and nearby municipalities.” PML § 1320(2)(a). The Selection Of The Wilmorite Proposal For A C: 10 In The Town of Tyre The Request For Applications Process 39. On March 31, 2014, the Location Board issued a Request for Applications (*RFA") for the four upstate casino gaming facilities authorized under the Act. 40. The Location Board subsequently received 17 applications, including one from Wilmorite for the Lago Resort & Casino (‘“Lago”) to operate a casino in the Town of Tyre in Seneca County. The Proposed Lago Resort & Casino In Tyre 41. The location for the proposed Tyre casino is approximately 25 miles east of the Finger Lakes Racetrack operated by Finger Lakes. ul42. Like the Finger Lakes Racetrack, the proposed Tyre casino is located in close proximity to the New York State Thruway. Approximate travel time between the two locations is less than thirty-three minutes. 43. Inits application, Lago forecasts that half of its first-year gaming revenue is expected to be drawn from existing New York gaming facilities. A copy of relevant portions of Lago’s application is attached as Exhibit 5. 44, While Finger Lakes’ existing facility will be the closest to the proposed Tyre casino, other existing facilities currently occupy the same market area and will be likewise impacted by cannibalization, including the Tuming Stone Casino, Batavia Downs, Vernon Downs, Tioga Downs, Seneca Niagara Casino and Hotel, Seneca Buffalo Creek Casino, and Hamburg Gaming. 45. On September 22, 23, and 24, 2014, the Location Board convened three 12-hour public comment events in Albany, Poughkeepsie, and Ithaca, i.e., in each of the three defined regions where it was considering casino applications. 46. Finger Lakes participated in the administrative process and submitted extensive comments to the Location Board with respect to the proposed Tyre casino. In its submissions, Finger Lakes emphasized the drastic cannibalization that would occur by siting a Las-Vegas-style casino so close to existing gaming facilities. A copy of Finger Lakes’ submission and comments are attached as Exhibit 4. 47. Finger Lakes’ President, Christian Riegle, submitted a letter outlining the severe harm that will result from locating a casino in an already saturated rural market. The 12letter summarized expert reports that were submitted to the Location Board and noted the resulting high rate of cannibalization, State revenue losses, and job losses. See Exhibit 4. The letter also focused on losses and damages that would result to the agricultural industry. 48. Along with the letter from Mr. Riegle, Finger Lakes submitted expert reports evaluating the market impact that would result from the construction of the Tyre casino. See Exhibit 4. Dr. Clyde W. Barrow of the University of Massachusetts at Dartmouth prepared a comprehensive analysis of the devastating impact that the proposed Tyre casino will have on Finger Lakes and the other established gaming properties. Dr. Barrow provided his expert opinion that the Tyre casino will displace over $100 million in gross gaming revenue currently received by Western New York's existing gaming facilities, a substantial portion of which will be taken from Finger Lakes. 67% of Lago’s projected gross gaming revenues will displace existing gaming activity and merely transfer gaming expenditures and employment from existing gaming facilities to the proposed facility. 49. As a result of the high level of cannibalization, the Barrow Report projects a loss of 1,040 jobs at existing gaming facilities, not counting the indirect employment that will be lost. Direct and indirect job losses that will result from closure of the Finger Lakes’ facility alone will total more than 1,700. 50. Finger Lakes provided comments, supported by expert analyses, demonstrating the severity of the cannibalization and how the Tyre casino conflicts with the goals of the Act, which are to foster economic development, maximize state revenue, recapture casino spending by New Yorkers out of state, capture casino spending by out-of-state residents, 13and provide the highest number of jobs. The expert analyses went unrebutted, with Wilmorite even admitting to the drastic rate of cannibalization. Cannibalization’s Impact On State Revenues 51. Finger Lakes also submitted a report prepared by Union Gaming Analytics, which performed an independent analysis of potential gaming revenue for the proposed Tyre casino. See Exhibit 4. The report notes that to reach revenue of $149 million, the Tyre casino will have to cannibalize five existing operations out of $133 million. See Exhibit 4, Union Gaming Analytics Report, p. 36. The net result would be an increase in a mere $16 million growth in the gaming market. 52. In 2013, $497 million in net gaming revenues were generated by four gaming operations within this market, including Finger Lakes’ facility, Turning Stone Casino, Batavia Downs, and Vernon Downs. If the Tyre casino were granted a casino license, there would be five operations, but the total gaming revenue is projected to remain near $500 million. See Union Gaming Analytics Report, p. 37. 53. Gaming revenue will be shifted from the “racinos” (Finger Lakes’ facility, Batavia Downs, Venon Downs) to the proposed Tyre casino. This will have a severe impact on the net revenue to the State. Due to the high tax rate on VLTs at racinos, revenues that are shifted from a racino to a new casino licensee reduce the State's revenues from gaming. In other words, each dollar of gaming revenue at a racino brings in approximately $0.66 to the State, It should be noted that up t0 10% ofthis amount is available for the State to pay vendors providing the VLT games. 14while each dollar of gaming revenue at the Tyre casino would bring in only $0.37 or $0.10 in revenues. 54. Each dollar cannibalized from a racino reduces the State’s revenues dramatically. According to the Union Gaming Analytics Repor, the State would lose $69 million in slot revenues due to cannibalization of the existing gaming facilities, with a net State revenue decrease of approximately $22 million. 55. This expert analysis was not discussed or evaluated in the Location Board’s decision, and stands unrebutted in the record. 56. The economic development and job creation aspects of the Tyre casino are limited by the fact that the Tyre facility will merely siphon off revenue, economic development opportunities, and jobs from other communities. 57. Moreover, the Tyre casino will actually decrease State revenues due to (1) the extreme cannibalization rate and (2) the lower tax rate at the Tyre casino compared to VLT facilities. The Location Board Issues Its Selections And Issues Its Final Report 58. OnDe ember 17, 2014, the Location Board adopted a resolution issuing its decision and findings and selecting three applicants for gaming facility licenses from the 17 applications submitted. A copy of the resolution is attached as Exhibit 1. The Location Board's preliminary findings, entitled “Selection of the New York Gaming Facility Location Board,” are attached as Exhibit 2. On February 27, 2015, the Location Board issued its final report andfindings, entitled “Report and Findings of the New York Gaming Facility Location Board,” relevant portions of which are attached as Exhibit 3. 59, The Location Board determined that the Lago Resort & Casino is eligible for a license from the Commission, and such determination is final and binding. Legal relationships and rights are fixed; the Lago Resort & Casino is determined to be eligible for a license, while the proposals that were not selected are ineligible, 60. Upon information and belief, Wilmorite immediately began construction of its facility. 61. The Location Board's determination with respect to the Lago Resort & Casino in the Town of Tyre is arbitrary and capricious. 62. The Location Board did not uniformly apply mandatory economic activity and business development factors, such as cannibalization, the mandate to maximize revenue, and the statutory purpose to recapture out-of-state casino spending by New Yorkers. With respect to some applications, the Location Board afforded the cannibalization factor so much. weight that it disqualified numerous applications categorically, including all six applications in Orange County. But in evaluating the Tyre casino, the Location Board barely mentioned it at all, even though cannibalization was much more severe. 63. The Location Board ignored significant record evidence, including submissions of expert reports and analyses, demonstrating the severity of the cannibalization that would occur as the result of a casino gaming facility in Tyre and the resulting loss of revenue to 16the State. There is no discussion of these reports in the Location Board’s findings, and they stand unrebutted. 64. Finally, the Location Board, upon information and belief, failed to consider the proposed ino to be constructed by the Oneida Indian Nation in Chittenango, New ‘York, less than 60 miles from the proposed Lago casino, in rendering its determination, There is no discussion of even further cannibalization that will occur as yet another casino is constructed in this already saturated market. 65. Thus, Finger Lakes has commenced this Article 78 proceeding challenging the Location Board’s eligibility determination with respect to the Lago Resort & Casino, Finger Lakes is entitled to an Order and Judgment annulling the Location Board’s determination that the Lago Resort & Casino in the Town of Tyre is eligible for a license from the Commission, and a preliminary and permanent injunction enjoining the Commission from issuing a license to Wilmorite for the Lago Resort & Casino, 66. Petitioner has no adequate remedy at law. AS AND FOR A FIRST CAUSE OF ACTION The Location Board’s Determination Is Arbitrary And Capricious Because Its Findings On Cannibalization Of Existing Gambling Facilities Are Inconsistent And Contradictory. 67. Petitioner repeats and realleges Paragraphs | through 66 above as if fully t forth herein, 68. PML § 1320 sets forth the factors that the Location Board must consider in rendering its eligibility determination, Economic activity and business development factors are given special prominence in the evaluation process by requiring they be “weighted by 7seventy percent.” PML § 1320(1). Local impact and siting factors — weighted by twenty percent — and workforce enforcement factors — weighted by ten percent — are given less consideration. 69. One significant economic activity and business development factor that the Location Board was required to consider is the extent to which an application will succeed at “maximizing revenues received by the state and localities.” PML § 1320(1)(b). This mandate is consistent with the purposes of the Act, which are to “boost economic development, create thousands of well-paying jobs, and provide added revenue to the state,” while providing revenue to support education and provide real property tax relief to localities. PML §§ 1300(5), (9). 70. A key component of “maximizing revenues” is potential cannibalization of existing gaming facilities and the potential impacts of locating newly licensed Las-Vegas-style casinos in the same market as existing gaming facilities. Cannibalization in this context means the significant shift in existing gaming revenue from currently licensed gaming facilities to a newly licensed casino. It also refers to the loss of economic development and jobs in one area, while purportedly creating it in the newly licensed casino’s host community. 71, Where cannibalization occurs, revenues to the State are not maximized; rather, existing gaming revenue is redistributed in a manner that is destructive to both existing facilities and the newly licensed facility. 72. An administrative board is required to uniformly apply standards and factors in rendering its determinations. It is also required to adhere to its prior precedent in rendering determinations on similar facts, Reaching a differing determination on similar facts requires an administrative body to provide a detailed analysis and explanation for the deviation. 18A board’s failure to uniformly apply standards and adhere to prior precedent in rendering a determination is arbitrary and capricious. 73. The Location Board failed to uniformly consider cannibalization and the maximizing of revenues when it deemed the Lago Resort & Casino in the Town of Tyre eligible for a license, while eliminating all six applications for casinos in Orange County. 74. Imits findings, the Location Board determined that the Montreign Resort Casino in the Town of Thompson, Sullivan County was eligible for a gaming license, and categorically excluded all applications from Orange County. Exhibit 2, p. 11; Exhibit 3, p. 14 Specifically, the Location Board found that “because of their proximity to New York City, all of the Orange County proposals resulted in a high level of cannibalization of existing downstate gaming facilities.” Exhibit 2, p. 11. “The Board recognized that an Orange County casino could generate substantial revenues as a result of proximity to New York City, however, review of various internal modeling scenarios found an additional facility in Orange County or a second facility in Sullivan County could destabilize that single project in the traditional Catskill area. Therefore, the Board has determined not to recommend the award of a license to any proposal in Orange County or a second facility in the Catskill counties.” Exhibit 3, p. 14. 75, The Location Board determined that cannibalization of downstate casinos, approximately 60-70 miles away, rendered more than half of the applications in the Catskills/Hudson Valley Region categorically ineligible. 76. This demonstrated the significant weight the Location Board placed on the cannibalization factor and the statutory mandate to maximize revenues to the State and localit For example, the Location Board excluded the applications from Orange County even though 19“an Orange County casino could generate substantial revenues as a result of proximity to New York City...” Exhibit 2, p. 11. 77. Yet the Location Board virtually ignored cannibalization and the statutory mandate to maximize revenues in determining the Lago Resort & Casino to be eligible. See Exhibit 3, pp. 276-277. The Location Board made only one cursory reference to the potential cannibalization of existing facilities in the Eastern Southern Tier/Finger Lakes Region, while simultaneously finding cannibalization was important enough to strike out 67% of the Catskills/Hudson Valley Region’s applications. Exhibit 2, p. 14; Exhibit 3, p. 32. 78. The cannibalization that would occur as the result of Lago — as admitted by the applicant — is much more severe than the cannibalization that would occur to existing downstate casinos from a proposed Orange County facility. First, the Orange County casinos are farther away from downstate casinos (approximately 60-70 miles) than Lago is from existing gaming facilities (¢.g., approximately 25 miles from Finger Lakes’ facility). Second, the sheer size of the downstate population — New York City being one of the most populous cities in the ‘world — would mitigate potential cannibalization. This is in stark contrast to the rural nature of ‘Tyre and the gaming market where the Lago Resort & Casino is proposed to be constructed. The Location Board failed to consider the wealth of the New York City market, versus the Seneca County market, and never discussed the oversaturation of the market into which Lago would be placed, versus the market serving New York City. The New York City market currently has 2 ‘gaming facilities, whereas the Tyre market has 10, After the approval of Lago and the new Oneida casino in Chittenango, there will be twelve, The Location Board's decision is arbitrary and capricious because it determined that cannibalization should prevent licenses in Orange County (an area serving a huge, wealthy market with few current gaming facilities) while 20allowing a license in Tyre (an rural, poor area with several nearby gaming facilities, the closest of which is a mere 25 miles away). 79. Ifcannibalization were applied uniformly with respect to all applications, as is required, there is no possible way the Lago Resort & Casino could ever be deemed eligible, given that all the Orange County applications were categorically excluded. 80. The Location Board failed to explain the lack of uniformity in the application of the cannibalization factor. Its findings provide no rationale explaining how the Location Board reached different conclusions on similar facts, and there is simply no evaluation of the significant record evidence that Finger Lakes submitted detailing the severity of the cannibalization and the negative impacts that would result from licensing the proposed Lago Resort & Casino. 81. Generally, where an administrative board's determinations are inconsistent and arbitrary, the inconsistency occurs days, weeks, or months down the road in a subsequent decision, But here, the Location Board's inconsistent and contradictory application of the statutory factors occurred within the confines of one decision, which is particularly egregious. 82. This is a textbook example of a decision that is arbitrary and capricious. The Location Board's determination that Lago Resort & Casino is eligible for a license from the Commission should be annulled.AS AND FOR A SECOND CAUSE OF ACTION The Location Board’s Eligibility Determination Is Arbitrary And Capricious Because It Ignored Significant Record Evidence Documenting Cannibalization, Reduction In State Revenues, And Failure To Maximize Jobs. 83. Petitioner repeats and realleges Paragraphs | through 82 above as if fully set forth herein, 84. As set forth above, Finger Lakes participated in the administrative process by submitting extensive comments and expert reports demonstrating that the Lago Resort & Casino application is not eligible for a gaming license, 85. Petitioner submitted a detailed report prepared by Clyde W. Barrow, Ph.D. entitled “The Regional Market Impact of a Proposed Tyre, New York Casino: Estimated Displacement of Existing Gaming Revenues & Employment” (the “Barrow Report”), which evaluated and projected the cannibalization that would occur as the result of the construction and operation of the proposed Lago Resort & Casino. See Exhibit 4. The Barrow Report found that 69% of Lago Resort & Casino’s gross gaming revenues and 87% of its annual visits will be generated by residents living in the local area (0-60 minutes) and 67% of Lago’s projected gross ‘gaming revenues will displace existing gaming activity and merely transfer gaming expenditures and employment from existing gaming facilities to the proposed facility. See Barrow Report, Exhibit 4, p. iv. 86, The Barrow Report also noted that the resulting cannibalized revenue to the Lago Resort & Casino will be taxed at a statutory rate, which will result in an overall reduction in revenues to the State, taking into account the current revenue sharing percentages vBwith the existing gaming facilities in the area. Thus, considering cannibalization, there is actually a reduction in revenues to the State. See Barrow Report, Exhibit 4, p. iv-v. 87. Both the Barrow Report and the Union Gaming Analytics Report projected and analyzed the high level of cannibalization that would occur. For example, while Finger Lakes’ facility will suffer the most (losing more than $76 million in revenue), the Turning Stone Casino, Batavia Downs, Vernon Downs, and Tioga Downs will all suffer cannibalized revenues (losing more than $57 million in revenue), resulting in significant job losses. 88. None of this was discussed or evaluated by the Location Board. 89. Governor Cuomo submitted a letter to the Location Board and Commission on December 26, 2014, suggesting that the Tyre location was not the intended location for casinos in the Eastern Southem Tier region. A copy of the Governor’s letter is attached as Exhibit 6. “[T]he construct of the exclusivity zones of the Seneca Nation of Indians and Oneida Indian Nation created a narrow band of land running to Lake Ontario. This portion of land became eligible for a casino, despite being hundreds of miles north of the counties that comprise New York's economically ailing Southern Tier.” Jd. 90. This narrow band of land running north allows proposed casinos to be considered outside of the Southern Tier and away from the New York-Pennsylvania border. ‘This makes it significantly more difficult to capture any out-of-state gaming revenue. See PML § 1300(6). 91. The Barrow Report notes that the proposed Tyre casino will attract little out-of-region revenue, and the possibility of obtaining out-of-state revenue is cut off as theproposed casino is located north of the Southern Tier. Only 14% of gross gaming revenues and 3% of annual visits will originate at a drive time of 91 minutes or more from the proposed facility. Barrow Report, Exhibit 4, p. iv. 92. With respect to jobs, the Barrow Report notes that “after subtracting job losses due to the displacement of gaming and non-gaming revenue at existing New York gaming facilities, the proposed [Tyre casino] ... will have a net impact of only 187 direct jobs ....” Barrow Report, Exhibit 4, p. v. In addition, more than 1,700 jobs will be lost once Finger Lakes is forced to shutter its existing facility. This is hardly getting the most out of the State's four potential licenses. 93. _Allof this record evidence was unrebutted. Even the applicant admitted that the cannibalization rate would be at least 50% from existing facilities. 94, No explanation was given for the Location Board’s failure to consider these expert reports, nor was there any effort by the Board to explain its inconsistent application of the cannibalization factor. 95, Finger Lakes is entitled to an Order and Judgment annulling that portion of the Location Board’s determination, which rendered Lago Resort & Casino eligible for a gaming license from the Commission. AS AND FOR A THIRD CAUSE OF ACTION The Location Board Failed To Consider Cannibalization, Motivated By An Improper Belief That Each Region Should Have At Least One. 96. Petitioner repeats and realleges Paragraphs | through 95 above as if fully set forth herein.97. ‘The PML divides the State into two development zones, and each of the two development zones is divided further into regions. Zone one includes the city of New York and Nassau, Putnam, Rockland, Suffolk, and Westchester counties. Zone two includes all other counties of the State, PML § 1310(1). 98. No gaming facilities are authorized in zone one, PML § 1311(1).. 99. Zone two is divided into six development regions. PML § 1311(2)(b). Of these six development regions, only three were authorized for the development of gaming facilities: “{t}he commission is authorized to award up to four gaming facility licenses, in regions one, two, and five of zone two.” PML § 1311(1). 100. Thus, up to four gaming facility licenses are authorized in three regions, which included the Catskills/Hudson Valley Region (region one, zone two), the Capital Region (region two, zone two), and the Eastern Southern Tier/Finger Lakes Region (region five, zone two). 101. The PML does not require a minimum number of gaming licenses to be issued, nor does it require that at least one casino be placed in each authorized region. 102, Instead, the PML sets forth the geographic areas of the State where gaming licenses are authorized and provides a detailed statutory program for location selection, with specific factors that must be considered, in accordance with the Legislature's purposes. 103, In rendering its eligibility determination, the Location Board must consider economic activity and business development factors, which are “weighted by seventypercent.” PML § 1320(1). The requirement to “maximiz{e] revenues received by the state and localities” is particularly important, given the PML's purposes. PML §§ 1300(5), (9). 104, Thus, as set forth above, cannibalization of revenues and jobs from existing gaming facilities is a critical factor that must be considered. 105, Recognizing the significance of this factor, the Location Board removed each and every Orange County applicant from consideration. 106. But in approving the Tyre casino, the Location Board ignored this factor, acting as if the PML required it to place at least one casino in each development region, But it does not. 107. In ignoring the cannibalization factor to select the Tyre casino, the Location Board rationalized its failure by stating that it had no choice, given the poor quality of the other two proposals for the Eastern Southern Tier/Finger Lakes Region (region five, zone two). See Exhibit 2, pp. 14-15; Exhibit 3, p. 32. 108. The Chairman of the Location Board, Kevin Law, stated that “We just thought it had the best chance for success in that region.” Jon Harris, Upstate Racinos Lose Big with Casino Picks, ROCHESTER DEMOCRAT & CHRONICLE, January 4, 2015 \dchronicle.comy/story/news/2015/01/04/finger-lakes-gaming-lago- 109, The Location Board’s findings ignored cannibalization because “Lago’s proposal is projected to generate significantly greater tax revenues to the State than the other Applications for this region.” Exhibi Exhibit 3, p. 32. According to Kevin Law, “itwasn’t really a cannibalization issue. We thought only one application was strong, and that was the Lago one.” Joseph Spector, Southern Tier Casino Rebid Irks Other Cities, STAR GAZETTE, January 10, 2015 (http://www. stargazette.com/story/newsilocal/new-york/2015/01/10/southern- tier-casino- criticism/21553213)). 110. The Location Board, in evaluating the statutory factors, was not required to pick | of 3 bad proposals, as it mistakenly felt constrained to do. Rather, it was required to pick 0 of 3 bad proposals, upon application of the statutory factors and uniform application of the cannibalization factor. 111, Incredibly, the Location Board is ignoring the cannibalization factor even further by moving forward with a separate, extra-jurisdictional request-for-applications process to put yet another gaming facility in this region. 112. In doing so, the Location Board will not be considering the State as a whole, as the PML requires, and it will not be evaluating Orange County, because of cannibalization; but it will be considering placing yet another gaming facility in an area that is already oversaturated with casinos and has a sparse population, lacking disposable income. 113. The Location Board's determination to approve the Tyre casino was affected by an error of law and is arbitrary and capricious due to its failure to apply the cannibalization factor uniformly and its belief that it was required to select at least one gaming facility for each region.AS AND FOR A FOURTH CAUSE OF ACTION ‘The Location Board’s Decision With Respect To The Tyre Casino Is Arbitrary And Capricious Because It Failed To Consider The Impact On Farmington And Other Nearby Communities. 114, Petitioner repeats and realleges Paragraphs 1 through 113 above as if fully set forth herein. 115, PML § 1320(2) requires the Location Board to evaluate local impact and siting factors. Among these is the requirement to mitigate impacts on nearby communities. PML § 1320(2)(a). 116, ‘The Town of Farmington is a nearby community, located less than 25 miles from the proposed Tyre casino. 117, Finger Lakes’ gaming facility is the largest private employer in both the Town of Farmington and Ontario County. Finger Lakes is a major contributor to all of Ontario County. Each year, Finger Lake’s gaming facility produces a cumulative economic impact of over $120 million, Finger Lakes is the source of over $46 million in annual regional business output. 118, In Ontario County alone, Finger Lakes” gaming facility makes nearly $4 million in annual purchases of goods and services, and attracts 2 million visitors annually to the area. 119, Approximately $2.3 million is received each year by Ontario County and the Town of Farmington as a direct result of Finger Lakes’ operations. Add to this, the tens of millions of dollars in revenues to the State.120. The Location Board was required to evaluate the negative impacts to Ontario County and the Town of Farmington in making its determination with respect to the proposed Lago Resort & Casino. It did not do so. 121. Due to the high level of cannibalization that will occur, something that, was not uniformly considered by the Location Board, the Tyre casino will render Finger Lakes’ existing gaming facility economically unviable and will be forced to close. 122, This will have significant, negative, irreversible effects on Ontario County, including the loss of a significant amount of annual revenues, the loss of more than 1,700 jobs, and the loss of the only privately owned racetrack in the State of New York. 123. There is no discussion whatsoever of any of these issues in the Location Board’s findings. Finger Lakes submitted all of this information to the Location Board during the administrative review process, 124, Failure to consider the negative impacts to the Town of Farmington and Ontario County generally, resulting from cannibalization of existing gaming revenues and jobs, violates the PML and is arbitrary and capricious. AS AND FOR A FIFTH CAUSE OF ACTION The Location Board Failed To Properly Consider The “Maximizing Revenues” Factor By Ignoring The Development Of Additional Casinos Within Adjacent Exclusivity Zones. 125, Petitioner repeats and realleges Paragraphs 1 through 124 above as if fully set forth herein,126, The Act provides exclusivity zones, prohibiting the development of casino gaming facilities in certain areas within the State. PML § 1311(2). These exclusivity zones are designed to prevent competition with Native-American existing and proposed casinos. Indian development of gaming facilities within the exclusivity zones is permitted by federal law and compacts between Indian Nations and the State. 127. As noted in the Governor's letter, the area where the proposed Tyre casino is to be located falls within a “narrow band of land” that falls between two exclusivity zones, the Oneida exclusivity zone to the East and the Seneca exclusivity zone to the West. See Exhibit 6. 128. The Location Board's determination that that the Tyre casino is eligible led to consider for a license is arbitrary and capricious because, upon information and belief, it f the potential and planned development of casino gaming facilities within the exclusivities zones on cither side. This represents a significant failure to adequately consider the maximization of revenues and jobs factors while severely underestimating cannibalization. 129. For example, the Oneida Indian Nation has announced the construction of ‘a gaming facility in Chittenango, New York and has positioned the proposed Chittenango casino to compete with the Tyre casino and Finger Lakes’ existing gaming facility. This announcement was made before the Location Board issued its final report and findings. 130. The proposed Chittenango casino is located on Nation lands approximately 60 miles from the proposed Tyre casino and approximately 80 miles from Finger Lakes’ existing gaming facility. 30131. The proposed Chittenango casino is within the same market as the proposed Tyre casino and Finger Lakes’ existing gaming facility. 132. Upon information and belief, the Location Board did not evaluate the potential impacts from further cannibalization due to the existence of the Oneida Chittenango casino in the same market as the Tyre casino. 133. There is no discussion of the proposed Chittenango casino in the Location Board’s findings, nor, upon information and belief, is there any analysis of the Chittenango casino in the record. 134, Similarly, there is no discussion or analysis of potential development in the adjacent exclusivity zones generally. 135. The Chittenango casino directly and significantly impacts the cannibalization/revenue maximization factor that the Location Board is required to consider. 136, Given the substantiality of cannibalization that is already projected to occur, as documented in the applicant’s and Finger Lakes’ submissions, failure to consider the Chittenango casino and potential development within the exclusivity zones generally is arbitrary and capricious and the Location Board's decision is effected by an error of law. AS AND FOR A SIXTH CAUSE OF AC If The Location Board Was Not Aware Of The Proposed Chittenango Casino, The ‘Commission Should Not Issue A License Based On An Eligibility Determination That Was Made Without Significant New Information. 137. Petitioner repeats and realleges Paragraphs | through 136 above as if fully set forth herein, 31138. Upon information and belief, the Location Board made no effort to evaluate development in exclusivity zones directly adjacent to the proposed Tyre casino. 139, Even more egregious, the Location Board failed to consider a specific proposal that was contemplated by the Oneida Nation as far back as 1993. 140. If the Location Board was unaware of the proposed Chittenango casino until after it rendered its determination, the Chittenango casino represents significant new information that must be evaluated by both the Location Board and the Commission. 141. Thus, the Court should direct the Location Board to re-open the decision, as the Governor has requested, and consider the further impacts the proposed Chittenango casino will have on cannibalization, job growth, and maximization of revenues. 142. The Court should enjoin the Commission from issuing a license to the Tyre facility until such time as the Location Board considers the cumulative impacts resulting from the Chittenango casino. AS AND FOR AN EIGHTH CAUSE OF ACTION The Location Board Failed To Permit A Gaming Facility In Orange County Because It Considered The Potential For Cannibalization Of The Newly-Licensed Sullivan County Casino 143, Petitioner repeats and realleges Paragraphs 1 through 142 above as if fully set forth herein, 144, Upon information and belief, the Location Board removed all Orange Is from consideration because they would cannibalize revenues and jobs from the Montreign casino, which the Location Board selected for Sullivan County.145. Upon information and belief, the Location Board applied the cannibalization factor to the proposed Montreign casino, and determined that any casinos in Orange County — or another in Sullivan County — would have a negative impact. See Exhibit 2, p. 9; Exhibit 3, p. 14, 146. Location Board Chairman Keven Law stated that the Location Board picked only one casino in each region for fear of cannibalization if two bids were awarded in any one region. Joseph Spector, Southern Tier Casino Rebid Irks Other Cities, STAR GAZETTE, york/2015/01/10/southern- January 10, 2015 (http://www.stargazette,com/storyinews/local/new-* ul -critie’ . 147. Thus, the Location Board afforded the cannibalization factor so much weight that it rendered other significant revenue-generating facilities ineligible based upon gaming facilities that did not yet exist. 148. But in approving the Tyre casino, the Location Board ignored cannibalization of existing facilities, It also ignored the Chittenango Oneida casino that had been contemplated in a compact with the State since 1993. 149. Moreover, upon information and belief, the Location Board determined that no gaming facility would be eligible in Orange County because it would make the Montreign casino in Sullivan County less likely to succeed. 150. The Location Board did not apply this analysis uniformly to other regions. ally, with respect to the Tyre casino, the Location Board did not evaluate whether a 33casino in Tyre would make other existing facilities — like Finger Lakes — less likely to succeed. 151. Thus, the Location Board applied different criteria to the different applications in making its determination. The Location Board’s failure to uniformly apply the statutory factors renders its decision arbitrary and the determination that the Tyre casino is eligible for a gaming license should be annulled. AS AND FOR A SEVENTH CAUSE OF ACTION Finger Lakes Is Entitled To A Preliminary Injunction Enjoining Issuance Of A Gaming License To Wilmorite For The Lago Resort & Casino In Tyre. 152, Petitioner repeats and realleges Paragraphs | through 151 above as if fully set forth herein. 153. Petitioner will suffer real, threatened, and imminent irreparable injury ifa gaming license is issued to the Lago Resort & Casino in Tyre. 154, The Lago Resort & Casino is proposed to be located a mere 25 miles from Finger Lakes’ existing gaming facility. As acknowledged by the applicant and as demonstrated by significant evidence in the record, this will result in a severe cannibalization of revenues from existing gaming facilities, including from Finger Lakes’ facility in the Town of Farmington. 155. The Lago Resort & Casino will have a devastating impact on Finger Lakes and the high level of cannibalization will result in significant layoffs and eventual closure of the facility, 34156, In 2013, Finger Lakes invested more than $12 million in capital improvements to its existing gaming facility, increasing its number of gaming machines by 29%. Despite this, Finger Lakes” gross gaming revenue has been essentially flat when compared to the previous year. Add the significant lost revenue resulting from cannibalization, Finger Lakes will be unable to recoup its investment and will be driven out of business. 157. The issuance of a gaming license to Lago Resort & Casino will set forth a series of events that will result in closure of Finger Lakes’ business, which constitutes irreparable injury, 158. If Lago Resort & Casino obtains a gaming license and commences operations, Finger Lakes has no adequate remedy at law, no avenue to recover its damages, and will be unable to stop the revenue losses that will end its business. 159. The Third Department has held that revenue losses coupled with an inadequate legal remedy for their recoupment results in irreparable harm to a business sufficient to warrant the granting of a preliminary injunction, Kings Mall, LLC v. Wenk, 42 A.D.34 623 (Bd Dep't 2007) (holding that the difficulty of recovering lost business revenue in an action for damages constitutes irreparable injury sufficient for the issuance of a preliminary injunction). 160. Petitioner is likely to sueceed on the merits. 161, Asset forth above, the Location Board (1) failed to uniformly apply the maximizing revenue/cannibalization factor in rendering its determination that Lago Resort & Casino is eligible for a gaming license; (2) ignored record evidence on cannibalization when it issued its determination; (3) failed to consider the potential impacts on nearby communities that 35would result from Lago’s cannibalization of revenue; and (4) failed to consider additional casino development within exclusivity zones and its impact on the statutory mandate to maximize revenue. The Location Board’s determination with respect to the Lago Resort & Casino is arbitrary and capricious and should be annulled. 162. The balance of the equities tips in Petitioner's favor. 163. The Location Board’s failure to uniformly consider the maximizing revenue/cannibalization factor has resulted in a determination that stands directly at odds with the Act’s purposes, as set forth by the Legislature. Development of these additional four casinos is designed to create more jobs, maximize revenue, and promote new economic development, not merely shift it from one location to another resulting in severe harm to existing business. 164. At bottom, Finger Lakes is faced with going out of business, which far outweighs the inconvenience or delay to any other party as the result of a preliminary injunction. 165. Petitioner is entitled to an preliminary injunction, enjoining the Commission from issuing a gaming license to Wilmorite pending final resolution of the instant Article 78 proceeding. 36WHEREFORE, Petitioner seeks an Order and Judgment (1) annulling that part of the Location Board's determination that rendered the Lago Resort & Casino eligible for a gaming license from the Commission, (2) granting a preliminary and permanent injunction enjoining the Commission from issuing a gaming license to Wilmorite; and (3) granting such other and further relief as to the court may seem just and proper. Dated: March 6, 2015 Albany, New York HODGSON RUSS LLP Attorneys for Petitioner vr By: __{_#te, Daniel A. Spitzer, Esq. Michelle L. Merola, Esq. Charles W. Malcomb, Esq. 677 Broadway, Suite 301 Albany, New York 12207 (518) 465-2333, 37ATTORNEY VERIFICATIO’ Daniel A. Spitzer, Esq., under penalty of perjury and in accordance with CPLR, 2106, affirms that the following is true and correct: Tam an attorney with Hodgson Russ LLP, attorneys for the Petitioner. 1 am fully familiar with the facts and circumstances of this action. I have read the foregoing Verified Petition and know its contents. The document is true to my own knowledge, except as to matters stated to be on information and belief, and as to those matters, | believe them to be true. The basis for matters stated on information and belief is my investigation of the subject matter of this action. This verification is being made by me because our client, Petitioner Finger Lakes Racing Association, Inc. is not a resident of Albany County, where this firm’s offices are located. Dated: March 6, 2015, 7 Albany, New York fo y iia 2 Daniel A. Spitzer, Esq. 00160.01299 Adasen 908292541