Why Not Take the Jump?

The history of legalized gambling in the United States is a study of cyclical boom and bust. For every rising tide toward open, freewheeling action, there has been a puritan riptide that eventually resulted in repeal, banishment, or prohibition.

Where is America's mood today on the high seas of betting? It's riding the crest of the wave. It is not even gambling anymore--it's gaming--and it's never been easier to place a wager. As slot machines and video lottery terminals are plugged in across the U.S. at breakneck speed, now could be the last chance for horsemen and racetracks to catch the big kahuna. If not, they could be left behind...this time for good.

It wasn't long ago when you had to go to Las Vegas or Atlantic City to pull a lever on a slot machine. State lotteries didn't go mainstream until the mid-1980s. By 2000, there were roughly 400,000 slot-type machines in operation across the country, with plenty more to come. In addition, there are 309 gaming operations on tribal Native American lands in 29 states. You can buy a state lottery ticket, Powerball ticket, pull-tab or scratch-off ticket at just about any convenience store. Bingo games are held in every nook and cranny of Middle America. You can gamble, er, game, online, on shore or off, and bet on horses over the phone--even in California, if you know which account to use.

In last year's report on wagering in this publication, pari-mutuel handle accounted for little more than 2% of market share when looking at 2000's total gaming handle.

Full-card simulcasting, the savior of purse growth for Thoroughbred racing in the '90s, is flatlining. The only substantial growth in purses in the last few years has come from states where slot machines and mutuel windows co-exist under the same roof. There's no doubt that slot machines draw a different segment of the wagering public and is a mindless exercise, but as H.L. Mencken suggested there's no underestimating the intelligence of the American public. Just ask any casino operator, television executive, or successful politician.

The current recession has left lawmakers from many states with budget deficits to combat. The once "not in my backyard" mentality toward gambling is being second-guessed as millions of dollars in potential tax revenues cross state lines by the bus load.

Slot machines and video lottery terminals already help stuff state coffers and horsemen's accounts at racetracks in Delaware, West Virginia, Iowa, New Mexico, and Ontario, Canada. Delta Downs in Louisiana just joined the party last week. Machines in places like Saratoga Springs and Queens, N.Y., are next. In Kentucky, the once "mythical armada" of riverboat casinos is real, and sits docked across the Ohio River in Indiana and Illinois. On most days, an all-too-real fleet of horse vans from Kentucky, Ohio, and Pennsylvania sets sail toward Mountaineer Park in West Virginia.

Over the last decade, Thoroughbred racing has been forced to wage an uphill battle for the gaming dollar--holding a weak hand against the deep-pocketed marketing power of corporate casinos. In Arizona, horsemen have to contend with 21 Native American casinos in their state, with the latest, the $50-million Casino Arizona, just minutes from downtown Phoenix and Scottsdale. The battle is taking place all across the country. It's time to realize the window of opportunity will never be as wide open as it is now.

Under current conditions, the best fit is to combine slots and VLTs with pari-mutuel facilities, but who is to say that will be the case the next time slot issues are on the local agenda? At some point, wouldn't it be just as easy for state lawmakers to bypass racing interests completely, and put the entire pot into the general fund?

Racing has already missed too many opportunities: from television exposure in the early days to the decades-long feet-dragging to form an effective league office. Remember what racing at places like Delaware Park, Prairie Meadows, and Sunland Park was like before they got slots? The window is open in states like Kentucky, Arizona, Florida, and perhaps Pennsylvania. Why not take the jump?

Evan I. Hammonds is managing editor of The Blood-Horse.