Slot Machine

Slot Machine

Anne M. Eberhardt

Ohio VLTs Progress; Horsemen Concerned

Ohio's governor signed a directive to implement VLTs at racetracks.

Democratic Gov. Ted Strickland signed a directive July 13 instructing the director of the Ohio Lottery to immediately begin taking steps to implement video lottery terminals at the seven racetracks in Ohio. But questions remain as to how the racing and breeding industry will benefit.

Strickland issued the directive as the Ohio House of Representatives and Senate debated the two-year state budget, which includes about $933 million in projected VLT revenue. Both houses were expected to pass the measure July 13 or July 14.

The directive makes no mention of horsemen, purses, or breed development programs. It simply says the state will get 50% of VLT revenue, and has no breakdown of where the other 50% will go.

Dave Basler, executive director of the Ohio Horsemen's Benevolent and Protective Association, said horsemen reviewed the directive and companion legislation included in the state budget bill. He expressed concern there are no provisions for "protection and improvement" of live racing in the state.

It appears horsemen will be left to negotiate a percentage of VLT revenue with racetracks. Sources said Standardbred horsemen that race at Ohio's four harness tracks also are concerned with the latest developments.

Racetrack officials couldn't be immediately reached for comment late in the afternoon of July 13.

Racetracks will be required to pay $100,000 non-refundable application fees and license fees of $65 million. The first installment is due by Sept. 15, with four payments due in fiscal year 2010.

The tracks must spend at least $80 million on facilities in the first five years of operation; $20 million must be spent within the first year, the directive states. Each racetrack can have a maximum of 2,500 machines.

The Ohio Lottery will purchase the VLTs, sparing the tracks the expense.

It is believed the horsemen’s share will come from the 50% that apparently will go to the racetracks. Earlier reports indicated purses and breeding programs would get 4%, the lowest figure in the country for horse racing. It wasn't clear July 13 how the horsemen's share, if in fact they receive VLT revenue, will be negotiated.

Strickland’s directive spells out the reasons for implementing VLTs. It doesn't mention the health of the horse racing industry in Ohio.

“The immediate implementation of VLTs by the Ohio Lottery is projected to generate approximately $933 million in net proceeds during the coming biennium,” the directive says. “The dedication of that revenue to education programs is critical to our continued efforts to strengthen Ohio’s education system.

“Increased lottery revenues allow the state to dedicate scarce general revenue funds to critical programs benefiting the health, safety, and welfare of Ohio’s citizens, avoiding devastating cuts to those programs.”

The directive states the General Assembly has assured Strickland it will pass companion legislation recognizing the Ohio Lottery’s legal ability to implement VLTs.