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Tuesday, January 22, 2008

Slots Notes - Jan 22

- As the Republican presidential candidates turn their focus to Florida for the critical January 29th primary there, slots proponents and foes are battling it out over the referendum, to be held that day, on the question of slots for the three Miami-Dade pari-mutuels - Calder, Flagler Dog Track, and Miami Jai-Alai. Supporters are flush with $5 million in cash provided by Calder (owned by Churchill Downs) and Flagler. On the other side, the Humane Society of the United States, which on Tuesday conducted a call-in to urge passage of laws banning the transport of horses to Mexico and Canada for slaughter, has donated $500,000 to slots opponents.

"Why is an out-of-town group spending $500,000 on an election in Miami-Dade County to put one dog track out of business when there are 14 other operational dog tracks in the state?" asked [Yes for a Greater Miami-Dade]spokeswoman Sarah Bascom. [Miami Herald]
According to the Sun-Sentinal, there are no less than 16 other pari-mutuels outside of Broward and Miami-Dade. Those tracks may be more interested in what is scheduled to transpire the following day: the opening arguments before the Florida Supreme Court on the Florida House's lawsuit against Governor Crist's gambling agreement with the Seminole Tribe. Crist's deal would preclude any expanded gaming outside of Broward and Miami-Dade. So the tracks have a lot riding on whether the high court accepts the House's argument that the governor may not act unilaterally in this case, and that their approval is required. They also feel that they offer the state a better deal, as in $1 billion of VLT revenue per year.
"They can play with $100 million from the Indians every year or $1 billion from the pari-mutuels," said Patrick Biddix, general manager of the Melbourne dog track. "That's the game plan — that the economic demand will dictate that they abandon the Indian compact in favor of VLTs." [Sun-Sentinal]
- A temporary racino at Fair Grounds opened in September with a mere 250 machines; the permanent facility will house 750. When the horses at this 149-year-old institution run by on the track outside, no one looks up. [New Orleans City Business (via Albany Law School Racing and Gaming Today)]. Sounds like everything is going according to plan. The Louisiana State Police report gamblers lost $1,602,781 on Fair Grounds slots in November for an average of $57.68 per person. I did some rough math and figured that the machines are averaging around $215 per day.

Purses at Fair Grounds were high even before slots came online; that was due to the booming business at eight OTB's that the track operates. Purses were boosted to an average of $405,000 a day by the end of last year's meeting. This year they'll start at around $355,000. Fair Grounds is a profitable racetrack - and it was even before slots - and the track's OTB's, several of which also have video poker, are no doubt a big reason why. That's what happens when OTB's are part of the racetrack operation, and perhaps a delegation from Albany should fly down to have a look.

Louisiana has one of the lowest tax rates on VLT's in the country. Only 18.45% goes to state and local taxes. Another 15.17% goes to the Gaming Control Board and other state agencies to cover their costs in running the joints.

Still, the state's four racinos contributed $13.8 million in state taxes....from July through September. Plus, the horsemen get a whopping 15%, thoroughbred and quarter horse breeders get 2% and 1% respectively, and the tracks get to keep 48%. I recall reading debates from other state legislatures in which Louisiana was used as the poster child for states not taxing their racinos enough. However, everybody seems to be happy!

Of course, not as happy as in Pennsylvania, where the state is collecting 55% of the booming business there. But certainly happier than in New York, where the prohibitive tax rates have track owners heading hat in hand to Albany (when they're not threatening to shut down), and the state offering only 6.5% of VLT revenues to the NY thoroughbred horsemen.

6 Comments:

Anonymous said...

Ny horsemen really screwed this up.

If Bruno is truly concerned with the future of Saratoga, he should make sure the percentage to purses is much higher. With purse levels not keeping pace with competition, SPA meet will suffer.

Already can not fill good claiming races due to DEL and MTH purse increases. Once PA is fully functional and MD finally jumps on board it will only become more difficult, ALW races will suffer too.

All those midlantic shippers will not be making the trip.

NY Bred Mdn Claimers here we come.

Anonymous said...

The Aqueductization of Saratoga will begin this year.

Maiden claimers and 10k claimers will be the norm, not the exception, in the 1st, 4th and finale on weekdays.

They may even need to increase the jump races again.

Glimmerglass said...

There is simply no need for the suggested doomsday talk of any " Aqueductization of Saratoga". The fields have been just fine in recent years with little need to add more maiden claimers and the like.

More steeplechase races at Saratoga simply won't happen. The NSA doesn't have the juice to influence NYRA to give up "more space" for the low-wagering and sadly little watched races.

As for more slots crying there was also suggestions that Arlington Park 'won't survive' without them as well. (see article link below)

I find that shocking as I've attended AP during the weekdays in the summer, catching easily a train that stops on the track's doorstep, and the place is full of people wagering. Seriously for a Friday without any stakes races they'll have well over 15,000 watching.

It helps the track is very clean, very accomodating with indoor space, family friendly, efficient, and easily accessed with parking and the aforementioned train access to Chicago.

Anyhow, the cited article:
http://www.dailyherald.com/story/?id=116866

Anonymous said...

I disagree, there used to be a regular diet of 35k-75k claiming races that simply no longer fill.

They wrote a record number of NY Bred races last year, and maiden claimers for the first time in recent history. The bottom claiming price was lowered.

There is a trend, and basic supply and demand rules indicate that as purses increase at other tracks the middle level claiming races and the preliminary alw races will become harder to fill.

This is already becoming the case at Belmont.

6.5% to purses doesn't cut it, when the original deal at 10% was one of the lower rates in the country.

alan said...

>>Ny horsemen really screwed this up.

At the very least, they certainly seem to have arrived late at the debate. But the high racino tax structure surely doesn't leave many crumbs on the table for them.

Anonymous said...

The affiliation with Empire Racing Associates was indeed in the NY horsemen's best interest. They are currently at the mercy of the NYRA when it comes to negotiations in NY, as the NYTHA by law has no real standing. Whoever talked them away from Empire last summer did the organization a terrible injustice.