Empire CEO Dave Hanlon, left, and developer Louis Cappelli, agreed, over a year ago, to partner in development of a new $1 billion complex at the former Concord resort. Work on that project is on hold, for now, because fo financing issues. Above, Hanlon and Cappelli explain the plans to the Sullivan County Legislature, a year ago.

MONTICELLO – Empire Resorts, Inc., the company that owns and operates Monticello Gaming and Raceway, faces an uncertain future. In its annual report filed with the Securities and Exchange Commission Friday, the company said difficulty in meeting their obligation to repay loans, continuing net losses, negative cash flows from operating activities and the uncertain economic environment “raise substantial doubt about our ability to continue as a going concern.” The company also said its independent public accounting firm stated in its report dated March 13 its “concerns about our ability to continue as a going concern.”

The company’s total revenues fell approximately $8.4 million, or 11 percent for the year ended December 31, 2008. Video gaming machine operations accounted for about $6.2 million, or a 10 percent decrease from 2007, of that reduction and racing accounted for about $1.8 million, or 22 percent decrease. The remainder of the decrease was attributable to food, beverage and other revenues decreasing by about $618,000, or about 11 percent.

Company officials said the decrease in video lottery machine revenues can be attributed primarily to more competition from similar facilities at Yonkers Raceway, which opened in November 2006, and new casinos opening in Pennsylvania in 2007. Economic conditions in the fourth quarter of 2008 also had an adverse effect on revenues, Empire Resorts said. And, patron visits decreased by almost 20 percent.

The decrease in racing revenue was primarily a result of reduced revenue allocations from OTB facilities, they said in their annual SEC report.

Empire Reports was counting on developing a full gaming casino with the St. Regis Mohawk Indians, but that fell through last year when then Secretary of the Interior Dirk Kempthorne refused to approve placing land in trust for the project.

Following that, Empire Resorts teamed up with Westchester developer Louis Cappelli to redevelop the old Concord Hotel in Kiamesha Lake and move Monticello Raceway’s harness track and its racino to the new project, which would also see hotel and conferencing facilities.

Because of the economy and the difficulty in securing financing for that project, it is unknown the speed at which that will move forward. Cappelli has not responded to repeated attempts to reach him for comment.