NY gets pact to add more VLTs to Monticello track

ALBANY, N.Y., June 23 (Reuters) - New York reached an agreement to move Monticello Raceway about two miles to a struggling resort area in the Catskills and add thousands of video lottery terminals in a project totaling $2.5 billion, Senate Majority Leader Joseph Bruno said on Monday.

The agreement calls for the development of the site of the former Concord Hotel, which was a top resort in the Catskills before the area fell on hard times.

"We have an agreement on one of the largest economic development projects in all of upstate New York, and that is the development of the Concord," Bruno said at a news conference with Gov. David Paterson and Speaker Sheldon Silver.

Empire Resorts (NYNY.O), the current operator of the Monticello Raceway, will develop the project in a joint venture with Concord Associates, whose site totals about 160 acres, Empire President Dave Hamlon told Reuters by telephone.

The raceway now has around 1,500 video lottery terminals and the deal unveiled on Monday calls for a new hotel and another 2,500 more video lottery machines.

The companies' share of the revenues from the video lottery terminals will rise to 75 percent from the current 42 percent share, Hamlon said.

Concord Associates is operated by real estate developer Cappelli Enterprises and is one of the biggest shareholders of Empire.

The Concord developer eventually will invest $2.5 billion in the project, Bruno said, estimating 2,000 permanent jobs will be created.

Bruno, a Republican, also said on Monday that he is not seeking reelection.

New York for years has struggled to rescue the Catskills resort area, located in Sullivan County, about 75 miles north of New York, from a decline that began when New Jersey's Atlantic City legalized casino gambling. The downturn in the area worsened after Connecticut's Indian reservations also became gambling meccas.

A spokesman for Paterson had no immediate comment.

"When the first billion (dollars) of private investment is invested, it will trigger a series of state aid that really results in an increase in the takeout on the VLTs," Bruno said, referring to the revenue the state stands to get from the slot machines. (Reporting by Elizabeth Flood Morrow in Albany; Additional reporting by Joan Gralla in New York; Editing by Leslie Adler)