Creditor of Vegas firm to seek bankruptcy

Wednesday, Aug. 11, 2004 | 9:22 a.m.

VERNON, N.Y. -- Mid-State Raceway says it will file for bankruptcy protection for its Vernon Downs harness track, which has been plagued by mounting debt and management turmoil.

Mid-State Chairman Paul Noyes said Tuesday it would be better for the track to go into bankruptcy court with its own plan of reorganization rather than having a plan forced on it by creditors. Noyes said the filing would come "as soon as possible."

A Chapter 11 bankruptcy would protect the company from creditors and allow it to operate while officials put together a plan to pay off debts. The company's largest lender is Vestin Mortgage of Las Vegas, which loaned the firm $26 million.

Mid-State has debt of nearly $30 million and, according to documents filed with the federal government, assets of $11.6 million. Mid-State consists of the racetrack, the Miracle Isle hotel, an unfinished casino building and 600 acres of farmland in Vernon, 35 miles east of Syracuse.

California businessman Eric Spector, whose company specializes in satellite transmissions of horse races to off-site betting venues, has been negotiating to buy the track.