Mini-Satellite System in California Hits Snag

The state horse racing board approves one new location but balks at two others.

The slow-developing California mini-satellite system added one betting parlor July 23 but hit a snag on two others due to problems with the wording of the law authorizing such establishments.

With little discussion, the California Horse Racing Board, meeting at Del Mar, approved a 68-seat wagering parlor at the Sycuan Indian Casino in nearby El Cajon in San Diego County.

But a 20-mile radius restriction scuttled immediate plans to add facilities at two San Francisco locations due to the objections from the satellite operation at the San Mateo Event Center. It runs the Jockey Club on the county fair grounds, close to the site of the former Bay Meadows.

Legislation approving up to 45 mini-satellite locations across the state was approved in 2007 and the CHRB finalized its rules in December. But the program has been slow in getting started. The first parlor opened July 17 at the Commerce Casino, a card club near Los Angeles with a top occupancy of 104.

Racing officials hope they can spark additional interest in off-track wagering by bringing the activity to places where the public convenes.The push comes during a time when simulcast wagering is in decline in the state as more and more people wager from home.

Portor Goltz, a deputy county counsel representing the San Mateo Event Center, said the Pacific Racing Association, the operators of Golden Gate Fields, made no attempt to gain approval before filing an application to operate mini-satellites at Pete's Tavern and Sotto Mare Oysteria in San Francisco.

"My clients strongly object to these applications," Goltz told the board. "They have never even made an attempt to talk to us. If we had not read the agenda for today's meeting we would not have even been aware that these proposals had been filed."

He argued that, contrary to a staff report filed with the applications, both of the proposed locations fell within the 20-mile protective radius of the Jockey Club. He demanded that written consent from the San Mateo satellite be obtained before the installation of a betting parlor can be approved.

"The 20-mile radius," he said, "would, frankly, include most of San Francisco."

Robert Hartman, representing Pacific Racing, said he relied on the CHRB's assurances that the two locations were outside the 20-mile zone and therefore didn't require consent from the San Mateo facility. He contended that San Mateo was more interested in "protecting its turf" than acting in the best interests of horse racing.

A debate ensued over whether the word "radius" in the legislation referred to driving miles or by air. Several people testified that radius refers to air miles.

"There is no ambiguity here," Goltz maintained. The board entertained the possibility of approving the new mini-satellites anyway, with chairman John Harris noting that the intent of the legislation was to get wagering locations into urban areas. Other board members were skeptical that two mini-satellites in San Francisco would have much affect on the operation at San Mateo, which is a difficult commute on the Bay Area peninsula.

Goltz disagreed, saying a number of his client's customers arrive by train from San Francisco to wager on the races.

Rod Blonien, a horse racing lobbyist, admitted he was the "oaf" who drafted the legislation with the word "radius."

"It was not my intent for it to refer to air miles; the intent was for it be for travel miles," he said. "I don't know why I used the word 'radius' three years ago and I wish to hell I hadn't."

The board indicated it would wait until the wording can be changed -- which could come by the end of the current legislative session -- to approve the new mini-satellites, or authorize them under a law already on the books allowing for the establishment of up to three satellites in the Bay Area.