The New York Racing Association's Board of Directors has announced that it has taken the first step toward the long-term transformation and re-privatization of the United States’ national Thoroughbred racing leader.

Via release, the association announced that the extensive process, which includes the development of a fully sustainable, three-year business model, kicked off earlier this week at the association’s board meeting in midtown Manhattan.

The meeting, which was open to the public and streamed live on nyra.com, featured a wide-ranging discussion related to the potential long-term legal and governance structure of the New York Racing Association. No decisions were made and no votes were taken at the meeting.

The board is required by statute to submit its recommendations on a statutory plan for the prospective governing structure of NYRA to the Governor and State legislative leaders by April, 2015. Discussions will continue as the board prepares a formal re-privatization proposal that will best position the New York Racing Association for long-term growth and success.

New York Racing Association Chief Executive Officer and President Christopher Kay introduced several potential elements of a re-organization plan. This included incorporating best practices for governance as employed by Fortune 500 companies and successful not-for-profit organizations, as well as a potential three-year business plan.

The organization’s senior VP and general counsel, Joseph Lambert, presented the requirements of the applicable statute as well as several thoughts on how NYRA should be structured and governed. This includes a smaller board than the current board which encompasses 17 members, the inclusion of the NYRA CEO to the new board, consideration of term limits for board members, in addition to possible frameworks for committees.

The board heard a financial update from senior vice president and chief financial officer Susanne Stover, which showed that the New York Racing Association remains on track for its first operating surplus since 2000. This operating surplus would be achieved exclusive of VLT revenue, and would result from effective revenue-enhancing and cost-cutting measures.

"As you may recall, we called for an operating surplus of $250,000, exclusive of the VLT funds, for our operating budget when we came to you last December," Kay stated to the board. "I'm pleased to be able to report to you that we will do much better than that, perhaps six times better than that, with a projected surplus in the neighborhood of $1.5 million for 2014."

Kay added the projected surplus for 2015 would be greater than that of 2014, and the projected increase of surplus for 2016 would be greater than in 2015.

"Our business plan reflects a business headed in the right direction," he said.

Additionally, Kay added that the 2015 budget would reflect a six-day-a-week schedule for Saratoga Race Course, beginning on July 24 and finishing on September 7, contingent on approval from the New York State Gaming Commission.

After having consulted with various stakeholders, Kay said it would not be appropriate for the current transitional board to make any long-term decisions on the real estate holdings. He noted that NYRA has made significant changes to Aqueduct Racetrack, devoting more than $14 million in capital improvements over the past 18 months.

The final piece of a reorganization plan, said Kay, involves potential amendments to specific laws and/or applicable regulations, adding that he was encouraged by the working relationship between the New York Racing Association and the Gaming Commission.

Kay thanked the board members for their ideas, their talent and their commitment to the process. He expressed the belief that their collective efforts will result in a re-privatization plan that will give the New York Racing Association a better future; one that will permit NYRA to continue to play a major role in providing significant economic impact - and jobs - in the horse racing industry in New York.

The next meeting of the board is scheduled for Wednesday, December 3, 2014.

(With files from NYRA)