Coffee hasn't totally kick in yet, but I think one of the reasons for delay in NY was that a group had sued challenging the constitutionality of the VLT law. About a year ago one court issued a decision that said VLTs where legal, but that sharing the dough with horse side was illegal, because per state const. all "lottery" $ had to go toward education. This ruling was appealed, and I think recently the highest court in NY issued a decision allowing both VLT operation and revenue split w/horsepeople.
Also during this time, the casino people partnering w/NYRA on VLT set-up didn't want to proceed until they knew what would happen in the court case and w/the franchise. I believe the state legislature just passed a law that said whoever gets the franchise inherits all obligations/licenses in re: VLTs.
Supposedly NYRA now believes VLTs will be up at AQU in early 2006; whether the court case and latest law really does move things forward is anybody's guess, given the way things happen here in Albany.
Thoroughbred Times and Bloodhorse web sites usually cover this stuff pretty well, probably can search their archives for more details on the court decision and the legislative action.