Howard HamiltonFOR the next several weeks, this column will share with readers some relevant issues in racing and gaming emanating from a symposium on racing held at the University of Arizona in December 2002. Last week we introduced readers to the "racino" concept, a blend of horse racing and gaming activity at a single venue.
THIS column has repeatedly referred to the pitiful state of the Caymanas racing plant and its inability in its present state to attract more people to racing and to provide them with a variety of wholesome gaming and entertainment options.
I certainly believe that the time has come when serious consideration must be given to how we re-invent racing and once again elevate it to its glory days as the Sport of Kings. Of course, this has to be a multi-dimensional approach that addresses every aspect of the racing industry.
But it is also clear that we have to consider investing in Caymanas racetrack to convert this into a total entertainment facility, where racing remains dominant, but where other forms of gaming can help to improve the overall experience at the track.
Here's how racinos work: Racetracks install slots, generally thousands at a time, on-site. Racing fans, presumably between races, spend a few dollars on the slots. The income made by the track, less the Government's tax, is funnelled back in the form of bigger purses for each race. In the US, the difference between a typical racino-funded purse and one without slot money can be as much as US$175,000 per race.
Big purses mean bigger paydays, attracting owners with better-performing horses and creating more competitive races. This, in turn, pulls in more bettors.
Some states have already become reliant on the income racinos pull in. In West Virginia, for example, some 10% of the annual budget of about $2 billion now comes from racino and gaming tax.
We in Jamaica need to keep pace with changes in this industry. We need to develop the knack of quickly recognising a valuable trend and the applying it, or a useful variation on the theme to making our own racing facility more attractive and viable.
To get a clearer example of the impact such a straightforward decision could have on a racing venue; let us look at the case of Canterbury Park in Minnesota.
Canterbury Park is proposing to install a multi-purpose entertainment facility operating on its 367 acres. The racino development would feature a hotel and conference facility, an Olympic-scale horse park and an agricultural event facility, in addition to live horse racing, simulcast tele-racing and card club gaming that is currently authorised. The Minnesota Legislature will be asked to authorise slot gaming for Canterbury Park, which will become the catalyst for the entire hotel and conference facility.
Canterbury Park hired an independent research firm, the Innovation Group, to conduct a market analysis. The firm projected that with the addition of slot machines: Canterbury Park could increase its annual revenues to the State of Minnesota by at least $55 million. This money, if deposited in the state's general fund every year, could be used to build or repair schools, improve roads and bridges, finance sports stadiums, promote rural economic development, or for many other purposes. An additional $1.3 to $1.6 million would go to city and local government in the form of taxes. Another $8 million would be used to supplement live racing purses at Canterbury, including $1.5 million that would go to the Minnesota Breeders' Fund.
Adding slot machines to the entertainment offering at Canterbury Park is expected to provide an additional boost to live racing and Minnesota's horse industry. Here's how: Live racing purses at Canterbury Park will increase by $8 million each year with the addition of slot machines. Of this amount, $1.5 million will go to the Minnesota Breeders' Fund, which promotes Minnesota's racing and breeding industry. With growing racing purses and a larger Breeders' Fund, the number of horses bred in Minnesota is expected to grow quickly. This growth, in turn, will positively impact the rest of Minnesota's agricultural industry.
Additionally, Minnesota's population and visitor growth is fuelling the demand for more gaming and entertainment options. Gaming in Minnesota has become a multi-billion dollar industry. Currently, 87 percent of Minnesotans participate in some form of gaming and the state receives tax revenue from gaming activities. Minnesota is likely to face another state budget deficit - and legislators are already looking for new sources of revenue to avoid significant budget cuts. Minnesota's casinos generate no revenue for state funding for education, transportation or other needed services. The Racino at Canterbury Park proposal would provide at least $55 million per year in new revenue to help meet the state's needs. Pragmatic, these Americans.
Next week we will look at how the Church has become involved in the Racing Industry. The Church has come to realise that Gaming is an activity that is here to stay and in a very pragmatic way has sought to guide and influence those involved in the industry particularly 'the Back Stretch Boys'. Their successful counselling and mentorship programme is something which our Church could do well to emulate. More about this in our column next week.
Howard Hamilton is the former Chairman of Caymanas Track Limited and is currently the President of the Jamaica Thoroughbred Owners and Breeders Association. He may be contacted at email:howham@cwjamaica.com.
