OH Track Relocations Must Wait Until October

Penn National Gaming Inc. has expressed interest in moving two racetracks.

by John Kady

A racing regulator in Ohio said Aug. 21 it will be the middle of October for a decision is made on allowing Penn National Gaming Inc. to transfer the racing licenses of its two tracks to other locations to take advantage of alternative gaming.

PNGI is building two full-scale casinos in Columbus and Toledo. It has said it wants to move Beulah Park near Columbus to the Dayton area and Raceway Park in Toledo to the Youngstown metropolitan area.

Ohio has a new law that authorizes video lottery terminals at the state’s racetracks. PNGI believes if VLTs are installed at the existing two tracks the company will end up competing with itself; the relocation markets it has identified have no casino gambling.

Ohio State Racing Commission chairman Robert Schmitz said the law that gives the OSRC authority to move racetrack licenses will not go into effect until Oct. 17.

“There are certain rules they will have to follow,” Schmitz said of track owners. “We want them to show us what they are planning to build. We don’t want them setting up a tent in an open field with a latrine and calling it a racetrack.”

PNGI officials have said they plan to spend hundreds of millions of dollars to build new facilities. Other track owners have hinted about possible moves but have offered no details.

Meanwhile, the Ohio Lottery Commission has authorized installation of VLTs by acting on the bill passed by the Ohio General Assembly and signed into law by Republican Gov. John Kasich this summer. The move, however, will be challenged by the Ohio Roundtable, a conservative group opposed to gambling.

Former Democratic Gov. Ted Strickland two years ago issued an order allowing for racetrack VLTs, but it was knocked down by a court ruling that said such a move must be approved by a statewide vote of the people. The Kasich administration also believes the lottery commission, which was established by a vote of the people, has the authority to expand its offerings to VLTs at racetracks.

“Nowhere in that constitutional amendment does it mention video lottery terminals or slot machines,” a spokesperson for the Ohio Roundtable said. “We are making sure we have all of our I’s dotted and T’s crossed before we challenge that move.”

Under the gambling law, each racetrack would have to pay a $50 million licensing fee. The state tax rate would the same as that for four full-scale casinos: 33.5%.