Kentucky Racing Industry 'at Risk'
Representatives of two Kentucky Thoroughbred tracks said they will be forced to reduce racing dates due to declining economic conditions, with the owner of Ellis Park saying his track would not race in 2010 unless alternative gaming is legalized in the Bluegrass State.
Appearing before the Kentucky Horse Racing Commission at its March 10 monthly meeting, Ellis Park owner Ron Geary painted a bleak picture for the future of the Kentucky racing industry as it faces competition from casino gaming in neighboring states. As a result, declines in wagering and subsequent decreases in purses and the overall racing product will force the track to reduce the number of days it races this year and offer no racing in 2010.
Geary said the immediate threat to Ellis Park's future comes from legalized casino gambling at Hoosier Park Racing & Casino and Indiana Downs, and the increases in purses at those tracks that far surpass Ellis Park’s purses. Also, as if adding insult to injury, the dates for the two Indiana tracks for the first time this year will overlap with Ellis Park's traditional summer meet.
Geary provided statistics from the Thoroughbred Racing Associations showing that Ellis Park will have estimated total purses of $4.5 million this year, compared with $11 million and $15 million, respectively, at Indiana Downs and Hoosier Park. Those projections show an even greater disparity in subsequent years, with Ellis Park having an estimated purse structure of $2.9 million by the year 2012, when Indiana Downs purses are projected at $22 million and Hoosier Park at $24 million.
In addition, Ellis Park will be competing with race meets Mountaineer Casino, Racetrack & Resort and Presque Isle Downs & Casino. And for the last 12 years, the track has competed with an Evansville, Ind., casino located seven miles from the Henderson racetrack.
“The result is we are in a jam as far as having horses this summer,” said Geary, who told the commissioners he would return by the April meeting with a request to reduce this year’s Ellis Park meet from the 48 race dates it has been assigned. The track owner said he would meet with horsemen's representatives and would have more accurate financial numbers from which to work before deciding exactly how many dates he would request for this year.
Geary said the options for the 2009 meet include possibly racing a Friday-through-Sunday schedule of three days per week, or clustering the races on holiday weekends and the July 16-29 period, when there will be no competition from the Indiana tracks.
“This is just me, personally, but I believe Kentucky must put its racetracks in a competitive posture,” Geary said. “Other states have alternative gaming, which means more state revenue, more jobs, and higher purses. Our signature industry, it is sad to say, is fading away right before our very eyes. Kentucky’s legendary horse culture is at risk."
Geary said the bottom line is that Ellis Park will not race in 2010 unless alternative gaming is approved by the state legislature, and he predicted other tracks would follow. Also at the meeting, Geary’s dire prediction was echoed by Corey Johnsen, president and managing partner of Kentucky Downs.
“Based on the business levels and trends in a competitive situation, we will request fewer live racing dates in 2010,” said Johnsen, noting that Kentucky Downs is reliant upon a solid purse structure to lure horses. All of the participants at the track ship in to race, a costly endeavor that must be recouped through the purses horsemen hope to take home.
Johnsen said the decline in purses at Kentucky tracks that do not have the benefit of casino-related enhancements has a multiplier effect because 90% of pari-mutuel handle is generated through simulcasting. Simulcast wagering customers look for large fields lured by the best purses structures in deciding where to place their wagers, Johnsen said.
Churchill Downs general manager Jim Gates, who attended the meeting but did not address the commission on the economics of the racing industry, said the Louisville track’s 2010 dates request would be in line with its traditional racing schedule. Any changes would come later, based on economic conditions, he said.
Rogers Beasley, director of racing at Keeneland, said there are no plans at this time to request fewer racing dates. He noted, however, that the success of Keeneland’s race meets and those at other Kentucky tracks rely upon a solid in-state racing circuit. That could be threatened by the actions being envisioned by Geary and Johnsen, Beasley said.
Also, he noted that Keeneland has a vested interest in the success not only of its flagship track but also that of Turfway Park, in which Keeneland is a partner. Turfway recently canceled a Monday race card -- added to its schedule as a makeup for a weather-related cancellation – because of insufficient entries.
Turfway president Bob Elliston has told The Blood-Horse the track may have to consider cutting racing dates in the winter if there is no additional revenue for purses.
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