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Monday, March 15, 2010

Luchento Speaks, Minus Pools, Grand Criterium Repeat

SBOANJ President, Tom Luchento, wrote an Op-Ed piece in the Asbury Park Press regarding how New Jersey casino interests are fleecing the State of New Jersey. Not only do they receive generous tax incentives and one of the lowest tax rates of all casino states, they are using their might to impede the expansion of VLT gaming at racetracks like the Meadowlands. This from an industry which has not delivered the promised revitalization of Atlantic City. Luchento's op-ed piece is an indictment of the gaming industry in New Jersey.

Readers of this blog know I am not a friend of racinos as racetracks and horsemen tend to use the VLTs to merely fill their pockets; failing to do anything to improve the product. I am still convinced VLTs are a short term fix, merely delaying the inevitable because racetracks and horsemen refuse to change their ways; doing nothing to fix the racing product. That being said, it is time to bring VLTs or casino gambling to the Meadowlands.

There is no excuse for withholding VLTs at the Meadowlands, or for that fact, any racetrack (perhaps with the exception of Atlantic City Racecourse) in New Jersey. The Atlantic City casino experiment has failed. For whatever reason, the casino industry has not delivered on its promise to make Atlantic City a destination; a Las Vegas East. That opportunity has come and gone. Casino gambling used to be special product, a novel activity in the United States. Now with the proliferation of racinos and casino gambling throughout the United States, casino gaming has become a commodity. There is no real differentiation between the various racinos and casinos. Like any commodity, customers are more concerned with price.

In the case of casinos, price includes time and expense; the time it takes to go and come from a racino as well as the expense involved in traveling. Why drive three hours to Atlantic City when one can drive a mere twenty five minutes to get to Yonkers Raceway? Why drive two hours to Atlantic City when one can drive a half hour to Allentown, PA? Casino gambling used to be special, now with its availability close to home, it has lost its uniqueness; for many, it is like going to McDonalds for lunch; somewhat ho hum. Sure, if you live in Northern New Jersey and you are a table game gambler, there has been a reason to travel to Atlantic City. However, with table games coming to Delaware and Pennsylvania (and it’s only a matter of time till it comes to New York); table games are also becoming commoditized. Once the table games are running in our neighboring states, what will be the impetus for people to travel to Atlantic City to play the same games they can in their neighborhood casino/racino?

While the Atlantic City casino industry is demanding their investment in Atlantic City be protected, millions of dollars are being wagered by New Jersey residents in Delaware, Pennsylvania, and New York (to a lesser extent Connecticut); sometimes in racinos operated by casino companies in Atlantic City. With those millions of dollars lost to neighboring states, the potential revenue to New Jersey is filling treasuries in other states. Unless New Jersey passes a law banning New Jersey residents from gambling in other states and is willing to close their borders, New Jersey residents will continue to wager at the closest gaming facility; most often in other states. No, allowing VLTs in the Meadowlands or other New Jersey racetrack is not going to bring in any significant revenue from residents of other states, but at least we can recapture the dollars gambled by New Jersey residents elsewhere.

While racing will benefit from VLTs, I support VLTs at the racetracks primarily as a New Jersey taxpayer. VLTs or a casino at the Meadowlands is the best deal for New Jersey taxpayers. While the casino industry protests horse racing, a sport in trouble due to its failure to innovate, is trying to survive with casino gaming, they fail to tell you they had their opportunity to make Atlantic City a gambling destination but they failed. What they are trying to do is keep their own failed business model running at the expense of New Jersey taxpayers.

This is not to say I support VLTs at the Meadowlands blindly. Unlike other states which allow VLT gaming at racetracks, New Jersey must mandate a percentage of slot revenue be spent on revitalizing public interest in the sport (and not just by raising purses) and they must hold the racetracks and horsemen to it. One way to do this is by putting in the enabling legislation targets which take effect five years after VLTs are installed where the percentage of funds the racetracks and horsemen both receive from the VLTs can decrease on an annual basis if handle and/or attendance do not increase. This way both horsemen and track operators will have the incentive to invest and modernize the racing product to meet their customer demands.

Remember how racetracks would cancel show wagering whenever Muscle Hill raced last year? Well, the Fair Grounds in New Orleans had show wagering this past weekend when Rachel Alexandra raced in the New Orleans Lady Stakes as did Santa Anita when Zenyatta raced in the Santa Margarita Invitational Handicap. Interesting to note that over a million dollars were wagered on Rachel Alexandra for show and I am sure that a lot of money was wagered on Zenyatta for show as well. Fortunately for both tracks, they did not get minus pools but they certainly ran the risk of it. I can see the need for fair meets canceling wagering to protect themselves from minus pools, but if these two tracks could risk minus pools on these horses, why can't standardbred tracks?

On the European Grand Circuit, Meaulnes du Corta won the Grand Critérium de Vitesse for the second year in a row at Cagnes-sur-Mer driven by Pierre Levesque in a wire-to-wire effort.  With this victory, Meaulnes du Corta has won the first two legs of the Grand Circuit this year.  There is some talk of a North American campaign for this ten year old (horses are not able to race in France past the age of ten).  It would be interesting to see him against Lucky Jim once Meaulnes was acclimated.        

1 comment:

LMJacobs said...

Mon Dieu!!!
C'est manifique.