Posts Tagged ‘slots’

By Ray Paulick
I’m one of those folks who like to bet on horses. During my infrequent trips to Las Vegas, the only gambling I do is at the race books. I’ve gone to riverboat casinos, gambling barges, slots parlors at racinos, poker rooms and Native American tribal lands that offer casino gambling simply to get an idea of what the places are like, the kind of crowds they attract, and what type of competition horse racing faces. I’ve never dropped a penny, nickel, dime or quarter into a slot machine, or even bought a lottery ticket. Those things just don’t interest me.

In a perfect world defined by me, people would still have to travel to Las Vegas or Atlantic City to get their gambling jollies. That’s the way it was until April 1, 1991, when the state of Iowa—not exactly known as a gambling mecca—opened the floodgates and launched America’s first state-sanctioned floating casino onto the Mississippi River. It’s taken less than 20 years since then for the landscape of our country to dramatically change.

Where are we today? Eighteen of the largest 20 metropolitan areas of the United States are within a three-hour drive of a slot machine or blackjack table, the lone exceptions being Atlanta and Dallas-Ft. Worth. During a summer cross-country drive, I was stunned at the places that now offer gambling, either through casinos legalized by the state or on Indian reservations made through state compacts in the wake of the federal Indian Gaming Regulatory Act of 1988. It made me feel like a stranger in a strange land.

All of this new competition has had an enormous effect on horse racing. Many state legislatures have recognized the competitive imbalance the racing industry faced and enacted measures to “level the playing field.” In most cases, those measures allowed tracks to install Video Lottery Terminals, or slot machines, the most popular form of casino gambling. Those are the “have” states in horse racing: places like Iowa, Delaware, West Virginia, Indiana, Louisiana, New Mexico, Pennsylvania, Oklahoma, Florida, New York and Maryland either have or will have slot machines for an additional revenue stream divided among state government, racetracks and horsemen.

The racing states without these additional forms of revenue, the “have nots,” have suffered: Kentucky, California and Illinois, to name a few. Residents of California have numerous Indian casinos with thousands of slot machines to siphon off potential horse racing gamblers. Illinois has casino “boats” throughout the state. Kentuckians have plenty of gambling choices, too, via a short drive across the state line into Indiana, Illinois or West Virginia. In Kentucky’s case, it’s not only hurt racing, but the breeding industry at its foundation, along with the state budget and the many programs that are in need.

Because of the massive expansion of gambling, VLTs, slot machines or casino wagering has become an economic necessity for racetracks across America (an enlightened Canadian government long ago gave the Ontario Jockey Club the right to compete with casinos at Woodbine). It’s not something I really want to see or particularly enjoy; in my world, racing would be able to survive on its own. But guess what? It’s not my world.

Critics have said slot machines are just a Band-Aid to what ails the sport—and it’s hard to argue that point. But aren’t Band-Aids used to prevent patients from bleeding to death while doctors try to heal the wound? I suggest this industry will bleed to death in some states, including Kentucky, without this help.

Others who oppose the legalization of slot machines say racetrack management is not to be trusted, another good point, given the fact that many tracks are now owned by publicly traded casino companies whose sole interest in racing is in its key to unlocking the casino door. That’s why the late President Ronald Reagan often repeated the phrase “trust, but verify,” when dealing with countries that had a different agenda or priority than ours. In other words, horsemen must be vigilant in dealing with legislators and regulators, get things in writing, and leave nothing to trust.

What’s been missing from the debate in Kentucky over slot machines is a vision for the future of the racing and breeding industry. How will racetracks use their newfound revenue to heal a bleeding patient? Are higher purses all that’s needed, or will tracks be required to invest in marketing the sport of racing, or to modernize their facilities? Will horsemen and tracks work together to readdress a business model that isn’t working, or to lower the takeout and make the game more affordable and attractive to gamblers who have more wagering options than ever before?

The enlightening commentary by Bill Farish of Lane’s End Farm published yesterday demonstrated the resolve that most in Kentucky’s Thoroughbred industry now have to overcome the politics that have prevented a leveling of the playing field with tracks in other states. What’s needed now is a comprehensive plan for how this proposed new revenue would make this sport one on which more fans will want to bet.

 

 

Copyright © 2009, The Paulick Report

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While Ray Paulick is dipping his toes into the Pacific Ocean and enjoying summer racing at Del Mar, another big race meeting is set to begin in Upstate New York. In fact, Saratoga is more than a race meeting; for many people it’s a tonic to cure, at least temporarily, what ails the racing industry. The Paulick Report has asked Brendan O’Meara to provide his impressions of Saratoga as the Spa meeting is set to begin. O’Meara covers horse racing in the Upstate New York region and blogs at The Carryover at www.brendanomeara.blogspot.com. He is currently working on a book of narrative nonfiction chronicling the 2009 Saratoga meet through various threads capitulating at the 140th running of the Travers Stakes.

By Brendan O’Meara
There’s a scene in the 1994 movie “Beautiful Girls” where Willy C, played by Timothy Hutton, and Paul, played by Michael Rapaport, are sitting in Paul’s room. Both are in their late 20s and Willy becomes both disturbed and vocal with Paul’s obsession with the super model pinups he has tiled all over his wall. Paul then goes into a rant, as if he has had to defend himself on this canon more than just this time.

“The super models are beautiful girls, Will. A beautiful girl can make you feel dizzy, like you’ve been drinkin’ Jack and Coke all morning. She can make you feel high, full of the single greatest commodity known to man. Promise. Promise of a better day, promise of a greater hope, promise of a new tomorrow. This particular aura can be found in the gait of a beautiful girl; in her smile, in her soul, and the way she makes every little rotten thing about life seem like it’s going to be okay. The super models, Will, that’s all they are, bottled promise, scenes from a brand new day, hope dancing in stiletto heels.”

Soon Willy gets up to leave, saying he plans to check the freezer for human heads. To which Paul belches out one last line, “A beautiful girl is all powerful and that’s as good as love. That’s as good as love.”

And isn’t Paul, in a manner of speaking, the estranged horse racing fan, not knowing quite where to turn, but choosing to hang his or her pinups on the wall, images of racing’s past an escape of necessity, of something that could, maybe, be claimed yet again?

There seems hardly a moment of cheer left in the “Sport of Kings,” what with Ernie Paragallo’s utter contempt for the equine species. How is it that Pete Rose gets banned from baseball for gambling on his own team, yet Paragallo is still allowed to own and breed horses

Slot machines were squashed in Kentucky and VLTs seem to hang like the proverbial carrot in front of the mule in New York. Those same slots baited the Kentucky Derby winner, Mine That Bird, to run in the West Virginia Derby for $750,000 as a prep for the Travers.

In a story in the Charleston Gazette, it was said that Mine That Bird trainer Chip Woolley owes slot revenue as the reason for having trained the little Birdstone gelding. After the purchase of Mine That Bird for $400,000, the owners had their eye set on an $800,000 purse in New Mexico, of all places. “Without slots, I wouldn’t have a horse like this,” Woolley told the Gazette.

And, Dios mios, the economy. Bloodstock prices are plunging, new owners can be seen playing bocce instead of the races, stocks are skimming murky waters with catfish, and mortgages are worth more than houses, but that doesn’t mean that all is lost.

Sure, for 46 weeks, this type of pessimism and negativity is both expected and welcomed. But for six weeks, those feelings will undoubtedly be kept in check because the Spa is open, Saratoga Race Course, a month-plus morphine drip. Without slurping the Spa too, too much, it is worth noting that the energy is ramped up. Entries for Opening Day at Saratoga are at 134 horses — 107 running, 27 also-entered. Del Mar had 92 racing on its opening day card on July 22.

Rachel Alexandra is stabled next to Steve Asmussen’s office with a little souvenir New York license plate nailed above her stall door that says RACHEL. She is under constant surveillance since Stonestreet Stable’s Jess Jackson bought a majority interest in the filly.

Rachel is even on Twitter. At long last this is how horses can use toe grabs, for typing. Within 24 hours, she went from following five people and having just a few followers to following 763 people with 186 followers. Talk about networking. Every Monday, much to the chagrin of her handlers, there are throngs of media arriving as early as 5 a.m. to watch her groom, Javier, brush her down and tack her up. As hot walker Juan Gonzalez circles the trees at Barn 65, letting the Medaglia d’Oro filly gulp water five chugs at a time, people gape and awe as if her walking stride were somehow more magisterial than the next horse.  They may be right. She is taking on the boys again in the Grade 1 Haskell Invitational this Sunday.  More appropriately, the boys are taking on her.

She has a stablemate, Kensei, winner of the Dwyer, who is pointing to the Jim Dandy. Should Kensei win and Rachel win, does that put two Stonestreet horses at odds with one another? Do they both run in the Travers? Who has preference? Is this a subtle cue that Kensei has a Travers edge? If Stonestreet wants Horse of the Year, the Travers will be a nice scratch on the bedpost.  So too could a win in, say, the Woodward.

Mine That Bird, should he come out of the West Virginia Derby sound and victorious, is going to the Travers. Summer Bird, the Belmont winner, should he come out of the Haskell in good order, is going to the Travers. Which leaves Rachel. This could be the first time in 27 years that all three winners of a Triple Crown race could square off in the Mid-Summer Derby. Not to mention the Florida Derby winner, Quality Road, and whoever should so happen to win the Curlin Stakes and Jim Dandy.  There could be as many five or six Grade 1 winners come Travers Day.

There’s also the claiming races with $30,000 purses.  Walk up to one of these claimers and borrow a line from The Boss, “You ain’t a beauty, but, hey, you’re all right.”

The best of the best are here in Saratoga Springs for 36 days of racing to bury the thoughts of poor sales and animal neglect.  Think of it is an escape. Money can be had at the windows and what sport offers its fans the option of bringing in their own beer and the opportunity to take cash home? And don’t say jai alai. It is a venue where, for a blink of an eye, the sport’s elite are on the grounds, where history is made every day, where known stars come and new stars emerge. Where society’s elite brush shoulders with the $2 bettor, and where the manure … still smells like manure, but that’s all right!

If nothing else, it offers hope, 36 individual pinups, and that, one might say, is as good as love.

UPDATE: The Kentucky Senate’s Appropriations and Revenue Committee rejected VLT legislation by a 10-5 vote on Monday night. The vote went pretty much along party lines, with Sen. Tom Buford the only one of 10 Republicans present  voting yes to send the bill to the Senate floor. Four of the five Democrats on the committee voted yes, with one abstaining.

Below is a live blog of the hearing….

After the Kentucky House of Representatives passed video lottery terminal legislation on Friday, the Senate’s Appropriations and Revenue Committee will give the bill a hearing late Monday afternoon. Ray Paulick is on the scene at the Kentucky Capitol in Frankfort and will provide up-to-the-minute coverage.

4:45 p.m. … The committee room was packed with people from the horse industry, but those without seats were told they would have to leave and move to adjacent room. Apparently, the Kentucky Senators may have feared an uprising.

4:50 p.m. … The hearing is called to order by Sen.Charlie  Borders,the committee chairman  who says opponents and proponents of House Bill 2 (VLT legislation) will each have up to an hour to provide testimony. He dismissed the notion that the bill would not get a fair hearing. He introduces Nick Nicholson of Keeneland, who begins by saying that he knew the bill would have a fair hearing because he knows the principals involved. Nicholson says the industry faces a problem not because of anything that’s happened in Kentucky, but because of what’s happening in competing states that have moved to offering slot machines. Eleven of 12 of Kentucky’s most compoetitive states offer alternative gaming at racetracks, Nicholson said, but the next time he testifies it will be 12 of 12 if Ohio goes in that direction, which Gov. Strickland said is now a necessity.

4:58 p.m. … Six casinos along the Kentucky border had a net win of $1.44 billion in 2008, Nicholson said. "I do know that hundreds and hundreds of millions of dollars of that $1.44 billion are hemorrhaging from Kentucky into Indiana," Nicholson said. 

5:00 p.m. …. Nicholson tells the panel that Kentucky’s horse breeders are the best in the world and that they are doing their job in producing the world’s best horses. "We aren’t going away tomorrow," he said. But Nicholson added that what is in crisis is Kentucky’s year-round racing circuit. He said the downhill slide of the racing  problem has come more quickly than expected. We didn’t think Churchill Downs would have to cancel one day of race a year, he said. "We thought we had more time." What’s changed the dynamic and caused the decline to happen more quickly than expected, was the bump in purses at Indiana racetracks, the increases in purses in Pennylvania and West Virginia, and the addition of a new track, Presque Isle Downs.

5:05 p.m. … Nicholson called the existing proposal "more moderate, more termparate," saying that the expansion of gambling would not be geographical. "I think it gives us the tools as an industry to compete with other states….We are asking you to give us the tools that our competitors have been given by their state government." 

5:10 p.m. … In the absence of House Speaker Greg Stumbo, Nicholson walked through the legislation and the differences between Stumbo’s version and the language proposed by Kentucky Gov. Steve Beshear. Among the differences, it’s worth noting, is that Stumbo’s version requires tracks to maintain the same number of racing dates they currently have. Stumbo’s version also charges a higher licensing fee to the various tracks, over $500 milliion to paid to the state over five years, versus $360 million in Beshear’s version.

"All 138 members of the legislature without exception want to help the horse industry," Borders said. He then referenced the "alternate" legislation proposed by Senate President David Williams that passed out of the Senate last week. That measure, obviously, was meant to be a pre-emptive measure to slow the momentum of the VLT legislation.

5:15 p.m. … Question time. Vice chair Bob Leeper wants to know if the projections were made before the financial markets meltdown of last September and suggests that casino gambling has taken it on the chin since then. Turfway Park’s Bob Elliston replies that "racinos" (racetrack casinos) have shown increases since then, going against the grain of standalone casinos.

5: 35 p.m. … Sen. Shaughnessy comments about the horse industry finally being together on the issue, saying that was far from the case when slots proposals first surfaced in the capital in the 1990s.  "I like the way you introduced this," Shaughnessy told Nicholson. Other industries have come to the capital for a bailout, he said, "but all you are asking for are resources to help make you competitive." He asks if the additional gaming will make it easier to market the overall racino experience, and be more than just a revenue enhancer. Tough question for Nicholson, since Keeneland is not planning to add VLTs to its racetrack and instead will share revenue from the Red Mile. "There are many, many disadvantages to being the last state to do this," Nicholson said. He added that being last does have the advantage of allowing Kentucky to see how other states have used the racinos to their benefit.

5:40 p.m. … Sen. McGaha gets a laugh from the audience when he said he’s in a hurry and demands "yes or no" answers from the slots proponents. First he asked Ron Geary of Ellis Park if he plans to run the original number of dates Ellis Park was given or the reduced number they now plan to run this year. Geary starts to give an answer that doesn’t start with "yes" or "no," then McGahah shouts "yes or no.," Geary says "yes," then McGaha says "Yes what?" I’m beginning to worry that the issue may be too complicated for some of these legislators.

5:55 p.m. … In closing, Sen. Borders reiterates his believe that every Kentucky legislator wants to helpo the horse industry, but then tips his own vote by saying, "We believe there is already a measure out there that does that. (the Williams alternate plan that taxes the lottery and out of state wagering on Kentucky racing."

The anti-gambling folks are next.

6:00 p.m. David Edmunds of the Family Foundation begins by complaining that Nick Nicholson’s PowerPoint presentation is getting stale. He also doesn’t think the VLT is constitutional, reading from Section 226 of the Kentucky Constitution. He evokes the name of Bernie Madoff in saying his type of pyramid scheme is unconstitutional under Kentucky law. How reassuring.

Edmunds continues to teach the legislature a history and civics  lesson….talking about the founding fathers and the evil of lotteries and horse racing. He also said House Speaker Greg Stumbo is very bad at bad. 

6:10 p.m. … Edmunds quoted from several published reports saying the Kentucky horse industry is doinig well, with great attendance at major events like the Kentucky Oaks and Derby, and even quoted from Churchill Downs CEO Bob Evans’ report to the shareholders at the company’s annual meeting, saying he had a bullish outlook for the company.  

A number of senators have walked out on Edmunds’ presenation, and can’t say I blame them. Edmunds is providing statistics compiled by people who have been educated at Harvard and MIT…that’s sure to impress some of these senators. His biggest concern seems to be an increase in the suicide rate if VLTs are allowed (oh, wait, they already allowed, just not in Kentucky). That’s the last straw: Edmunds tells us that the definition of insanity is doing the samme thing and expecting different results. No, Mr. Edmunds, you are the definition of insanity.

Next witness, please!

Sen. Shaughnessy ridicules Edmunds’ accusations that the state lottery is a "blood-sucking vampire." He then reminds Edmunds that he supports Williams’ bill to tax the lottery further as means to increase purses at racetracks. Edmunds stutters and hems and haws and then mercifully is done.

6:35 p.m. … House Speaker Stumbo enters the room..,..apparently the House has adjourned for the day. 

6: 40 p.m. …  The next witness (whose name I did not catch) slams the Herald-Leader for its accuracy and then cites a Herald-Leader story questioning the number of jobs the horse industry says it contributes to Kentucky’s economy. He then says the horse industry doesn’t spend enough money promoting itself and said Churchill Downs should have gone to night racing years ago when baseball and football went to night games. "Welcome to the modern world," he said.

6:45 p.m. Before the head of the charitable gaming association speaks, chairman Borders recognizes House Speaker Stumbo and tells him the pro-VLT legislation team did "an adequate job" presenting their position.  When riverboat casinos began in Indiana, charities on the north side of the state suffered a loss in players, Ron Morris of the charitable gaming association said. He said other developments such as anti-smoking laws have also hurt charitable gaming.

6:50 p.m. … Sen. Boswell moved to pass House Bill 2 to the Senate floor without comment. Chairman Borders said the motion was out of order but would be honored in a few minutes. That woke a few people up.

6:55 p.m. … One last speaker on the opposition side represents CAGE (Citizens Against Gambling Expansion). The spokesman for the group said people will be sold into bondage to slot machines in order to support racetracks in Kentucky, that they will spend hundreds of millions of their own money, and money they steal from their employers and credit card companies.

7:00 p.m. … Sen Boswell’s motion is made to pass the bill without expression (meaning no support or opposition stated). 

Boswell votes yes, but gives a lengthy explanation as to why he supports the legislation Buford votes yes but wants a local-option amendment to be added on the floor of the Senate.Sen. Angel also votes yes, saying her 81-year-old father is a retired trainer, and she also represents the district where Churchill Downs sits. Yesterday, Angel, said she heard from many constituents by email saying the people want a floor vote on the senate.

Harris votes no, saying the Senate has already passed a bill that protects the horse racing industry through improved purses and breeders’ incentives. "I’m also concerned that the (VLT projections) just don’t work," Harris said.

"This is a tough vote," says Sen. Kerr of Lexington. "I too feel that we have proposals on the table that could help the horse industry without damaging our most vulnerable decisions." Her vote will be a "no."

Wingnut Sen. McGaha says a yes vote for the bill is a vote for suicides and employee theft. Certainly the most rational explanation I heard during the hearing.

Sen. Shaughnessy complained before his yes vote that the committee did not represent a fair hearing, in large part because the committee is stacked disproportionately with Republicans. Shaughnessy said Senate rules call for committees to be divided between Democrats and Republicans along the ratio of their seats in the Senate. Democrats have 40% of the Senate seats but half that on the A&R Committee, he said.

7:15 p.m. … Let’s cut right to it. After a computer failure at just the wrong time, I can report that the measure failed to get the committee support and will not be sent to the full Senate. Voting no were Sens. Borders, Leeper, Harris,  Kelly, Kerr,  McGaha, Smith, Stivers, Tapp, and Tori.. Voting yes were Boswell, Buford, Angel, Pendleton and Shaughnessy.Sen. Palmer abstained and Westwood was absent.

The room cleared quickly, many of the people from the horse industry leaving with long, sad faces. One horse owner, Jack Smith, shouted in the direction of Republican Sen. Damon Thayer, "You will never get another penny of support from me," Smith told Thayer, who is a consultant to the horse industry and a former Breeders’ Cup and Turfway Park executive. Thayer called the remark inappropriate and said he was not a member of the committee that rejected the slots bill. Thayer never came out in support of the bill, either. And for a senator who claims to be the Thoroughbred industry’s point man on Kentucky legislation, that speaks volumes.

That’s it from the live blog