Ohio Racetracks Regroup in Wake of Failed Referendum

Ohio racing interests, stung by the failure of a Nov. 7 referendum that would have allowed video lottery terminals at the state's seven tracks, didn't rule out another attempt and said there could be legislative assistance for the industry in the interim.

The "Ohio Learn and Earn" referendum, which called for revenue from gaming to go toward college scholarships, would have tripled Thoroughbred purses and funneled money to breed development in the state. Proponents spent more than $10 million on an awareness campaign but the referendum lost by a 57%-43% margin.

Beulah Park majority owner Charlie Ruma, who chaired the Ohio Learn and Earn Committee, said the referendum lost because top officeholders in Ohio government, including outgoing Republican Gov. Bob Taft, opposed it, and because of a flood of what he called misinformation. Proponents, for instance, projected about $2.8 billion a year in revenue based on figures from high-powered consultants, while opponents, through the state Office of Budget and Management, claimed the figure would be about $1 billion.

"It was a fictitious projection -- about one-third of what we projected," Ruma said. "The governor was outrageous. And (Republican Sen.) George Voinovich outworked us. We learned some things. He will never outwork me again."

Others said the ballot question itself may have been problematic. There also was, according to reports, some resistance to the revenue splits that would have given 55% of VLT proceeds to racetracks, which would have had to bear the cost of building VLT casinos.

"History proves and gambling experts predict that the market share for gambling expansion will get smaller and smaller in the coming years," David Zanotti, president of the Ohio Roundtable, a nonprofit organization that opposed the VLT measure, told the Akron, Ohio, Beacon-Journal. "I think this was a last-ditch attempt by some very shrewd businesspeople to catch the last train into the gambling profits."

Taft and Voinovich, the former Ohio governor, strongly oppose expanded gambling. The governor-elect, however, is Democrat Ted Strickland, who isn't expected to fight racing-aid proposals, officials said.

Ruma said an Instant Racing bill currently sitting in the House of Representatives could be introduced in the Senate during the upcoming lame-duck session. Instant Racing machines employ recycled horse races and are considered pari-mutuel even though they resemble video gaming devices.

"We're hoping for good bipartisan support," Ruma said. "There's a chance the legislature may want to take care of the horsemen. We've got a shot to get Instant Racing, and if so, maybe three years of improved conditions. I'm very positive."

Track officials said another referendum push for gaming is possible.

"We haven't really gathered to think about it," River Downs general manager Jack Hanessian said, "but we'll be talking about the alternatives. We're just in the same boat as every other track in the country without gaming. This is the third time in the last 16 years a (gambling) issue on the ballot has failed, but it was the first time all the tracks were on the same page. It's encouraging the margin of defeat was narrower than ever before."

"We could come back next year," Ruma said. "The question is, 'How do we want to do it?' It's my opinion that in the next two to four years, we'll be back with a basis that makes more sense for Ohio and will be more salable to the public. We learned a whole lot this time."

Meanwhile, it appears this year's reduction in racing dates for Thoroughbred and harness racing will remain in place next year. The cuts were pushed by Ohio State Racing Commission chairman Norm Barron as a way to conserve purse money and increase field size.

The racing commission is scheduled to meet Nov. 16 to discuss dates for 2007.

"I don't think there will be any significant change," Barron said. "As you know, I've been an advocate for fewer live racing dates, and last year we had a breakthrough. My sense is Beulah Park and River Downs will probably agree to the reduction (implemented from 2005 to 2006). Thistledown would probably like to race a little less.

"Certainly, there will be input from the horsemen. I want to get as much input as we can from all the factions. But down the road, we must look at the number of horses and the quality of horses that can sustain live racing in Ohio. We're obviously disappointed (with the outcome of the referendum), but there could be some movement in going back to the legislature."

Hanessian said the switch from a six-day week to a five-day week allowed River Downs to increase purses about 20% and bolster field size. He said the 2006 season was a success when compared with the previous year.

"The way things look, we may be able to start our season next year where we left off this year," Hanessian said. "The horse population is good, and we're fortunate to be so close to Kentucky. We're going to try, and keep trying, and never give up."

Said Beulah Park general manager Mike Weiss: "From my standpoint, it's business as usual. We're not any further back than we were before."

Average daily Thoroughbred purses in Ohio run from $47,000-$75,000 depending on the track. Revenue from gaming devices under the Ohio Learn and Earn plan would have put them in the $150,000-$200,000 range, according to projections.