Panelists: Racing Better as Part of Entertainment Package
Updated: Wednesday, February 8, 2006 4:20 PM
Posted: Wednesday, February 8, 2006 4:20 PM
Representatives of operations that have or will have gaming at racetracks left little doubt which half of the equation drives the financial engine, and they indicated marketing horse racing as an entertainment option rather than a gambling enterprise may be the way to go.
The topic of racinos, subject of an ongoing debate, was addressed again during a Feb. 8 panel discussion titled "Racing's New Partners" at the Racing Congress in Las Vegas.
Tim Willmott, chief operating officer for Harrah's Entertainment, said the gaming company expects to spend about $400 million to develop a harness racino in Chester, Pa., just south of Philadelphia. About $100 million will be spent on racing facilities, and $300 million on gaming infrastructure.
"Obviously, we wouldn't be interested in that development if it wasn't for the slot machines," Willmott said.
Harrah's, which also owns Louisiana Downs in Louisiana and Turfway Park in Kentucky, would look at other racing opportunities only if the "economic model" in various states made such acquisitions worthwhile, Willmott said.
Bob Soper, president and chief executive officer of Mohegan Sun at Pocono Downs, said the northeast Pennsylvania harness track was the Mohegan Tribe's first commercial acquisition. (It operates Mohegan Sun casino in Connecticut.) Soper said the company was much more interested in potential "synergies" than horse racing.
"We're new to live racing, but we appreciate the spirit and intent of racing and the law that allows (slots at racetracks)," Soper said. "We have a strong commitment...to improve racing opportunities at the track."
Chuck Keeling, vice president of racing operations for Great Canadian Racing Corporation, which owns Hastings Park in British Columbia and four harness tracks, said his job is to keep racing viable. But he noted there are challenges, not the least of which is the perpetuation of a "bad business model" should racing be unable to generate a return on investment.
"It will cause big problems in this business moving forward," Keeling said. "As a racing person, I'm very concerned about that long term."
Panelists seemed split on whether integration of gaming machines and the racing product works, though Bob Farinella, who will soon step down as president and chief executive officer of Prairie Meadows in Iowa, said the goal was to integrate, not segregate. Farinella said though on-track handle is static, live racing has attracted a younger crowd and serves a purpose far more important than its 4% contribution to total revenue at the facility.
Sen. Paul Massicotte, a financier who recently purchased four harness tracks from the Quebec, Canada, government, said 1,900 video gaming machines were the hook for the investment. He said his company plans to build a new racino in Montreal, as well as upgrade the other three tracks in the package.
Massicotte said if horse racing is just a gambling commodity, it could be problematic. But when part of the bigger entertainment picture, racing can be successful.
"If the whole (package) makes money and it's a good investment, the industry will survive," Massicotte said of horse racing.
Soper said he said slots and racing as "two different animals." He said he doesn't believe slots play cuts into wagering on horse racing, and that the focus should be on developing synergies between the two.
The Racing Congress is a product of Harness Tracks of America, the Thoroughbred Racing Associations, the United States Trotting Association, and the United States Harness Writers Association.
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