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| Indianapolis Star June 11, 2005 Horse Tracks Still Betting on Gaming Industry officials say Hoosier Park, Indiana Downs need pull-tabs to save racing in state. By Michael Pointer Christmas was a few days away, and Rick Moore was dreaming of the ultimate present. Indianapolis Mayor Bart Peterson had just announced plans for a new Colts stadium that would be funded by slot machines in Marion County. Suddenly, the local horse racing industry had a high-profile partner in its attempts to bring pull-tab machines to Hoosier Park and Indiana Downs, which the tracks have long hailed as their only means of survival. "I don't think we've been in the limelight that much," said Moore, Hoosier Park's president and general manager. But in the end, the dream took another step backward. Peterson's call for expanded gambling never came close to passing. Senate President Pro Tempore Robert Garton, R-Columbus, killed alternative-gambling legislation after it was revealed two state legislators had financial ties to Centaur, a minority owner of Hoosier Park. A similar bill got farther in 2004, passing in the House before dying in the Senate. But this time, Moore said, was harder to take. "To be honest with you, there is more of a disappointment in that we looked like we were poised to have a breakthrough session," he said. The Colts likely will get their new stadium, but it is expected to be funded in part from a series of 1 percent restaurant taxes in the surrounding counties, and a 1-percent increase in the existing tax in Marion County. Horse racing officials, on the other hand, continue to mutter a familiar refrain: Wait until next year. Until then, the losses continue. According to data supplied by the Indiana Horse Racing Commission, Anderson's Hoosier Park, whose majority owner is Churchill Downs Inc., reported a 2004 loss of $1,070,591, nearly double its 2003 loss of $555,083. That was its first reported loss since 1996, its third season. Indiana Downs, which opened in Shelbyville in 2002, actually cut its losses last year, but it was a hollow victory. The track reported a loss of $2,172,504, down from about $3.9 million in 2003. With other financial indicators for the industry also down locally, the question is begged yet again: How much longer can either track continue to sustain such losses? Neither Moore nor Indiana Downs general manager Jon Schuster would speculate on that. Despite their tracks' losses, the two men and their investors still see a significant payoff -- and a healthy industry -- if the legislature eventually grants their wish. "We plan on being here long term," Moore said. "But we want this industry to grow." The legislature will hear from the industry again when it reconvenes in January. It likely will be asked to pass legislation that would add pull-tab machines (similar to slot machines) at the two tracks and off-track betting facilities in Indianapolis and Fort Wayne. "We have no choice," Schuster said. "We're not giving up and we're not going away." Troubles abound Currently, Indiana law forbids pull-tabs or casino-style gambling at Hoosier Park or Indiana Downs or the tracks' off-track betting facilities. Delaware, Iowa and West Virginia are states with little racing tradition that have implemented alternative forms of gambling at their racing facilities, and purses have boomed. Indiana officials point to those states as examples this one needs to follow. Ed Martin, owner of an Indianapolis car dealership and a founding member of the Indiana Horse Racing & Breeding Coalition, calls the legislators' ties to Centaur an unfortunate development, but he remains convinced progress has been made on adding gambling. (Centaur president Jeff Smith declined to comment for this story.) "It's just a continuing education process," Martin said. "Other states are adding alternative gaming slowly. They're in the same situation. I'm cautiously optimistic something can happen in the future." In the meantime, Martin has sent three Indiana-bred horses he owns to Philadelphia Park to take advantage of improved purses at Pennsylvania tracks, which have recently added slots. Philadelphia Park is a short drive from Delaware Park, which also has benefited by adding slot machines. There are other bad signs for Indiana. The number of state-sired standardbred horses born in 2003, the last year for which figures are available, was 940 -- the fourth consecutive year that figure has declined. The number peaked at 1,329 in 2000. Larry Smallwood, former general manager at Swifty Farms near Seymour, said only about 25-30 mares are scheduled to be bred there this year. That's compared to 161 that were bred in 2003 at Swifty Farms, the state's largest thoroughbred breeding operation. The total number of Indiana-bred foals fell to 419 last year from 516 in 2003. "We're letting a billion dollar industry go down the tubes," said Smallwood, who recently left Swifty to work as a bloodstock agent. "We make a bigger impact (on the state) than (the proposed new) convention center and the Colts." 'Our responsibility' Some racing industry officials pin the legislative failures on horsemen trying too hard to portray pull-tabs as a convenient way to address Indiana's budget crisis. They would rather promote the industry's economic benefits, which they believe would touch all of the state's 92 counties. Thomas H. Meeker, president and CEO of Churchill Downs Inc., said he and other company officials will tout those benefits harder than ever when the legislature reconvenes in January. They point to a Purdue University study released in 2001 and commissioned by the racing commission, which stated that the racing industry generated more than $120 million in its first five-plus years in the state from 1994 to 1999, most of it in agriculture. (Anti-gambling advocates have disputed those figures.) "We're not going to walk in and say we can save the world and mitigate all your budget issues," Meeker said. "But what we are going to say is consistent with the public policy expressed when they pressed for horse racing, and that was to grow the agribusiness in the state of Indiana." Gov. Mitch Daniels said last month he was pleased the legislature passed a budget without expanded-gambling legislation. But Daniels, who said while running for governor in 2004 he opposed any expansion of gambling, added he wouldn't rule out revisiting the issue. "The door can't be closed on any option," he said. "There's plenty of sentiment for this particular direction. There are ways in which that activity could be legalized while gambling elsewhere was reduced." Meeker, who has met with Daniels, isn't surprised by the governor's comments. Few elected officials want to be seen as being a gambling advocate, he said. But Meeker said he is convinced Daniels will be receptive if the racing industry proves its economic benefits. "It's going to be our responsibility to make the case," he said.  |
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