The timing of a series of campaign contributions from senior members of Buffalo’s most wealthy family to its political scion, freshman Senator Chris Jacobs, is suggestive of a quid pro quo arrangement on Senate Bill 4068, a measure that authorizes the use of state money to expand the nine racetrack casinos that operate in New York.
Two of those casino operations are owned by Delaware North, the privately held multi-billion dollar firm owned and operated by Senator Jacobs’ uncle, Jeremy Jacobs, Sr., whose net worth is estimated north of $5.2 billion in an August 2018 Forbes ranking.
Jacobs failed to properly recuse himself from that June 19, 2017 vote.
The timing of campaign contributions raises concerns.
The non-family executives who manage Delaware North, with well over $3 billion in annual top-line revenue, don’t typically make campaign contributions. Presumably, they are too busy advancing the strategic business interests of the firm to concern themselves with the Jacobs family’s political interests.
But that was not the case for three executives in key roles in December of 2016 — a month after Jacobs won his election to the New York State Senate, but a month prior to the beginning of the legislative session. Todd Merry, Dan Zimmer, and Eileen Morgan each contributed $500 to Jacobs for State Senate just before the Christmas holiday.
Merry is Chief Marketing Officer, overseeing “strategic global marketing efforts,” spanning all of its operating companies and locations on four continents. His executive biography also notes that he leads all sales and marketing efforts, including using the company’s customer data and technology to achieve business objectives.
Zimmer is Vice President for Corporate Finance and Development. At the firm since 1995, he has served in several business strategy and finance positions. He is responsible for the firm’s “strategic finance initiatives.”
Morgan is Chief Human Resources Officer, whose portfolio includes “talent and organization development.”
Not long after those executives returned to work from holiday, the firm quickly made two substantial campaign contributions to Jacobs for State Senate on January 11, 2017. The first was from “DNC Parks and Resorts Inc.” in the amount of $3,000, and the second was from “DNC Travel Hospitality Service Inc.” in the amount of $2,500.
DNC Parks and Resorts is a holding company that operates as a subsidiary of Delaware North Companies. It operates the firm’s resort subsidiaries, like DNC Parks & Resorts at the Kennedy Space Center, based it Titusville, Florida; and the former DNC Parks & Resorts at Yellowstone National Park, for instance. It is this arm of the conglomerate that operates the firm’s ten gaming destinations in eight states.
DNC Travel Hospitality Service Inc. is the arm of the conglomerate that manages the firm’s restaurant and concession businesses around the globe.
By February 2, 2017, the bill was referred to the Senate Committee on Racing, Gaming, and Wagering. Shortly thereafter, Delaware North Companies (the parent holding company), made a $2,000 contribution to Jacobs for State Senate on February 8, 2017.
Days later, on February 14, 2017, the New York Gaming Association PAC made a contribution in the amount of $1,000. Delaware North funds the New York Gaming Association PAC with the owners of New York’s other racetrack casinos.
Senate Republicans allowed the bill to come out of that committee shortly thereafter, on March 7, 2017. By March 13, the bill had advanced to it’s “third reading,” and had cleared the procedural hurdles required to ready the legislation for a vote on the floor.
But after waiting for nearly two months with no floor vote in sight, four substantial contributions were simultaneously made to Jacobs for State Senate on May 10, 2017:
- Finger Lakes Racing Association Inc., a subsidiary of DNC Parks & Resorts, owns and operates the Finger Lakes Gaming & Racetrack in Farmington, NY. It contributed $5,000.
- Southland Racing Corporation, another subsidiary of DNC Parks & Resorts, owns and operates Southland Park Gaming & Racing in West Memphis, AK. It also contributed $5,000.
- Wheeling Island Gaming, Inc, another subsidiary of DNC Parks & Resorts, owns and operates the Wheeling Island Hotel, Casino & Racetrack in Wheeling, WV. It also contributed $5,000.
- Delaware North Companies, the parent holding company, contributed $2,500.
On the same May 10, 2017, several senior members of the Jacobs family who serve as officers of the corporation made substantial contributions to Jacobs for State Senate:
- Jeremy Jacobs, Jr. is the co-CEO of Delaware North, and the eldest son of Jeremy Jacobs, Sr., the firm’s chairman. He is responsible for the firm’s long-term strategic direction, determining mergers and acquisitions. He contributed $3,000 on that day.
- Lou Jacobs is the co-CEO of Delaware North responsible for positioning the company in emerging markets. In 1995 he was named executive vice president after serving as president of Delaware North Companies International, during which time he oversaw the subsidiary holdings in the Pacific Rim, Middle East, Eastern Europe, and Australia. He also contributed $3,000 on that day.
- Charlie Jacobs, the youngest child of Jeremy Sr., is the co-CEO of Delaware North responsible for the firm’s Boston operations, including the operations of the family’s NHL franchise, the Boston Bruins. He serves as an Alternate Governor of the National Hockey League. He also contributed $5,000 on that day.
- Lisa Ann Jacobs also made a $3,000 contribution on that day.
The following week, Jeremy Jacobs Sr. and Margaret Jacobs, the patriarch and matriarch of the family, each made contributions of $2,500 on May 23rd and May 25th, respectively.
Less than two weeks after receiving those checks, Senate Bill 4068 is suddenly brought to the floor for a vote on June 6, and on June 19. Jacobs failed to recuse himself from both votes.
Majority Leader John Flanagan (R-Long Island) controls which bills are brought to the floor for a vote and when. He is Jacobs’ closest ally in the chamber, and Flanagan’s majority rests on the 60th district’s vote. Because the 60th is the most Democrat-enrolled district held by Republicans, it is often considered the ‘swing vote’, giving its occupant an outsized level of influence in the chamber.
S.4068 passed the chamber overwhelmingly and was sent to the Assembly, which passed an amended version of the bill on June 21, 2017. Governor Andrew Cuomo signed the bill into law on August 21, 2017.
Delaware North executives are currently in the design and planning stages of expanding its casinos in Hamburg and Farmington, now authorized to use millions in state money at each venue to expand those facilities’ amenities, with the aim of growing revenue and profit numbers.