The board of directors for Western Regional Off-Track Betting Corp. authorized changes to its payment policy on Thursday in response to revelations that two employees, including a former Niagara County lawmaker, authorized cash payments for several years to a vendor who did not have tax forms or proof of insurance on file with the public agency.
Announced as part of what management describes as its “2025 reform agenda,” WROTB officials said it has adopted new standard operating procedures for cash payments to help “ensure proper authorization, secure handling, accurate documentation and strict compliance with financial best practices.”
The board also announced on Thursday the adoption of an updated “house accounts” policy amid questions over the distribution of so-called “comps” for food, beverages, gambling “free play,” hotel accommodations and merchandise by officers and employees, including in some instances to family members and friends.
“As we continue to evaluate and strengthen our operations, it is imperative that we take corrective action whenever deficiencies or opportunities for improvement are identified,” said former Buffalo Mayor Byron Brown who took over as the public benefit corporation’s CEO and president last October.
The payment policy changes followed an internal review in which management determined Chief Operating Officer and former Niagara County Legislator Scott Kiedrowski made cash payments to Chuck Buscaglia, a vendor who has provided exterminating services at the hotel at Batavia Downs since WROTB assumed management of the hotel in 2021.
Kiedwrowski’s resume also includes stints as chairman of the Niagara County Republican Party. He was considered a right-hand man to former WROTB CEO and President Henry Wojtaszek, who led the public benefit corporation from 2016 until last year when he exited to clear the way for Brown’s appointment.
An eight-page report distributed by Brown to the agency’s board indicated that the payment issue was discovered on May 23 when Cindy DeCarlo, controller of Batavia Downs operations, brought an envelope containing $1,050 in cash to the office of Chief Administrative Officer and Chief of Staff Steve Casey.
According to the report, DeCarlo told Casey the funds were intended as payment to the hotel exterminator and were supposed to be given to Kiedrowski who had left for the day.
The reports indicate that, at the time of the attempted cash exchange, both Brown and Vice President of Human Resources Danielle Fleming were present and “refused to accept the funds due to concerns regarding the payment method and lack of documentation.”
Brown’s report notes that, upon further inquiry, it was discovered cash payments had been made to the exterminator since 2021 when WROTB took over operations at the hotel.
“We were told that in the past, the cash was hand-delivered to COO Scott Kiedrowski, who then forwarded it to either the hotel general manager Rick Likus or the exterminator directly,” Brown’s report notes.
In addition, the report outlines several “critical” findings, including that no W-9 tax forms are on file for the vendor and that, according to hotel administration, the vendor was not insured.
“Due to the fact that all three (Kiedrowski, Buscaglia and Likus) reside in North Tonawanda, it raises potential concerns regarding connections, vendor vetting and conflicts of interest,” Brown’s report notes.
According to the report, both Brown and Casey informed Kiedrowski of the situation when he returned to work and he acknowledged that the cash exchanges had happened in the past and that he found payment practice as “odd” but did not intervene.
On May 29, according to the report, Brown, DeCarlo and Casey discussed the situation with staff from the New York State Comptroller’s Office who were on-site as part of a wider audit of WROTB.
“They advised us to temporarily take no further action. A week later, they gave us clearance to proceed internally. To date the necessary documentation (W-9 and insurance) has not been received from the vendor, therefore, no payment has been issued. Board Chairman Dennis Bassett was also notified of the issue,” Brown indicated in his report.
In response to a request for comment on Thursday, Kiedrowski noted that Brown’s memo “clearly” indicated that all WROTB procedures were followed and there are no missing funds and “everything is fully accounted for.”
Kiedrowski also said he never met with the vendor in question and that he was told he is not a North Tonawanda resident but rather lives in the Town of Newfane.
“Certainly, we can always improve our processes and if the new administration along with the board of directors wants to follow a different protocol than the one we inherited when it comes to environmental services at the hotel, we will do that,” Kiedrowski said. “The fact is that this was a small vendor who had done a good job and had been utilized by past and current hotel management. We just continued to follow the same process.”
According to Brown’s report, the public benefit corporation has allowed certain vendors to be paid in cash under “special circumstances.” His report also acknowledges that while internal control procedures, including purchase requisitions, purchase orders and invoice approvals, were “technically followed,” other issues emerged. Those issues, as outlined in the report, include:
• Agency representatives writing checks to WROTB, cashing checks and giving cash payments directly to vendors;
• Payments being documented under Batavia Downs Gaming instead of the actual vendors and
• Cash being issued to vendors without formal tax documentation.
“This practice exposes the corporation to audit, compliance and reputational risk,” Brown’s report concludes.
The revised payment policy adopted by the board on Thursday immediately suspends all cash payments and directs all purchase requisitions and payments to be issued directly to vendors.
In addition, the new policy bars payments from being made to any vendor that doesn’t have a valid W-9 form on file and proof of insurance. The policy also includes a requirement that payments cannot without “vendor vetting to ensure no conflicts of interest exist.”
“The revised payment policy ensures alignment with the best financial practices, enhances internal controls and upholds compliance with tax and audit standards,” Brown notes in his report.
The other policy change adopted by the board on Thursday aims to address concerns raised as part of a February review of operations over the authorization of “complimentary offerings to patrons, including what’s identified in Brown’s report as “apparent instances of personal use of comps for friends and family members by officers.”
In one example cited in Brown’s report, $27,595 comps were documented as having been distributed by one officer who was not identified from 2021 to 2024. In that instance, Brown’s report indicates the officer comped “friends” 12 times for a total of $1,592 during the time period in question.
The new policy adopted by the board on Thursday sets forth what Brown describes as “clear procedures” for who is authorized to issue complimentary items and services, which categories of comps are permitted and ensuring comps are allocated only with proper documentation, approval and oversight.
“Complimentary offerings, when used appropriately, are an essential strategic tool to enhance customer service, build brand loyalty and retain high-value patrons by creating positive and memorable guest experiences,” Brown noted in his report. “When executed responsibly, comp programs align with the corporation’s broader business objective, support guest satisfaction and drive long-term revenue growth.”
WROTB initiated its so-called “reform agenda” in February as part of what officials described as an effort to usher in a “new era” of accountability, transparency and operational efficiency.