NEWS
Illinois tracks, horsemen unite
to preserve slot machine rights
Posted: Tuesday, December 01, 2009 8:29 PM
by Neil Milbert
The five Illinois racetracks and the state’s Thoroughbred and harness horsemen are making a joint push to the legislature, trying to win permission to install video lottery terminals or slot machines to offset the anticipated loss of state tax revenue because at least 40 municipalities, towns, and counties have banned the machines.
When the Illinois legislature authorized 75,000 video gaming machines at bars, restaurants, and truck stops earlier this year, it was estimated that the tax revenue would fund approximately 33% of a $33-billion capital improvement bill that would repair roads and bridges and enhance facilities at schools and public libraries, creating 30,000 to 40,000 jobs.
Now, racing industry studies project a shortfall of about $100-million yearly because some communities are declining the invitation to allow their eating and drinking establishments to install up to five of the gaming machines, which contribute 5% of their adjusted gross revenue to the participating community.
After holding a news conference to explain how they hoped to take up the slack and bolster their declining sport in the process, several racing industry leaders testified before the Commission on Government Forecasting and Accountability.
“It’s widely and commonly known the Illinois horse racing industry is experiencing major declines in handle and purses,” Illinois Racing Board Executive Director Marc Laino told the commission. “The handle for 2009 [at the state’s three Thoroughbred and two harness tracks] is down 13% from 2008 and this follows a 2008 decline of 12%.
“Purses paid today are comparable to those paid in the 1980s. Live racing programs have been reduced 50% since 1997.”
Laino pointed out that approximately $96-million in impact fee funds that the legislature mandated that the state’s four highest-grossing riverboat casinos pay to the tracks and horsemen is being held in escrow because of federal lawsuits by the casinos.
“Any legislation [to bolster purse accounts] that has been passed since 1999 hasn’t come to fruition,” Hawthorne Race Course President Tim Carey said. “We haven’t seen one dime of that money and now the rules of the game have changed—the legislature has authorized every bar, restaurant, and truck stop in the state to conduct gaming.”
Thoroughbred and harness racing representatives emphasized that not only is the sport operating at a disadvantage in competing with other forms of gambling in Illinois, it also is at a disadvantage in competing with tracks in many other states.
“Of the 19 major racing states, 12 have already adopted alternative gaming,” Arlington Park President Roy Arnold said. “There are now 45 casinos in operation at racetracks across the U.S.”
“Increasing purses [through alternative gaming] will draw more pari-mutuel wagering not only at the racetrack but nationally and internationally.”
The tracks and horsemen are hoping that a temporary restraining order lodged by the four highest-grossing casinos is lifted by a judge on Monday, freeing from escrow money that accumulated under the 2006 law that required the casinos to contribute 3% of their adjusted gross revenue for two years to tracks for improvements and horsemen for purses.
“The casinos have exhausted all of their appeals at the state level,” Fairmount Park President Brian Zander said. “A week ago, the casinos went to federal court and got a temporary restraining order ordering tracks and casinos to appear [on November 30]. The hearing concluded and the judge continued the temporary restraining order until Monday.”
Neil Milbert is an Illinois-based Thoroughbred Times correspondent
