Boston, MA --- Stakeholders in the horse racing and breeding industry said Wednesday (Oct. 16) they will be in a holding pattern until the Massachusetts Gaming Commission awards licenses for full-scale casinos and a slot machine parlor in the state.
The commission held a forum on horse racing and breeding to get input on several issues, including the payment schedule for gaming proceeds. But racetrack and horsemen’s representatives said it’s hard to make decisions until they find out the status of racing facilities in Massachusetts.
The lone slots parlor in the state will have to pay nine percent of its gaming revenue to the Race Horse Development Fund, no matter where it’s located. Plus, 2.5 percent of 25 percent of gross gaming revenue from full-scale casinos also goes to racing, as does five percent of the upfront license fees for all facilities.
Penn National Gaming Inc. wants to locate the slots facility at Plainridge Racecourse, the state’s only harness track.
Suffolk Downs, the only Thoroughbred track left in Massachusetts, has applied for a destination casino license. The track intends to apply for 2014 racing dates, but the future of the racetrack itself probably hinges on winning the gaming license.
Michael Perpall of the New England Harness Horsemen’s Association noted most Massachusetts horsemen stay in the state 12 months a year even though racing isn’t offered in the winter in the state. The Plainridge racing surface, however, is open for training year-round.
Uncertainty over next year’s racing schedule and the gaming licenses have led horsemen to curtail investment in new stock, Perpall said.
“You can’t go this year because we don’t know (what’s happening next year),” Perpall said while holding up a copy of the “Black Book” catalog for the upcoming Harrisburg sale. “It’s very difficult to restock inventory.”
Perpall said that this year, for the first time, he purchased a Maine-bred racehorse because the program offers more stability at this time.
Stephen O’Toole, general manager at Plainridge, said the racetrack, which offers year-round full-card simulcasts, loses an average of $1 million a year on racing operations. He noted that about 10 years ago purses for some classes of races at Plainridge were on par or higher than those at many New York harness tracks, but gaming supplements have greatly changed the regional environment.
“Today, operating a racetrack is a gamble,” O’Toole said.
According to gaming commission figures, live pari-mutuel handle at Plainridge fell 39 percent from $2.4 million in 2007 to $1.5 million in 2011. Full-card simulcast handle at the track dropped 20 percent from $57.9 million in 2007 to $46.1 million in 2011.
Purses paid at Plainridge also declined from 2007 to 2010, from $3.1 million to $2.5 million.