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Philadelphia Freedom
- BY NICOLE KRAFT

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Freeedom

Chester seeks to become a racing Mecca next spring

by Nicole Kraft

Heading northwest from the Philadelphia International Airport, up I-95 or the Schuylkill Expressway’s I-76, visitors come face-to-face with the City of Brotherly Love. Sports venues—home to the Phillies, Eagles, 76ers and Flyers—erupt from the earth, as the skyscape welcomes visitors with William Penn atop the Philadelphia City Hall and the Liberty Tower twin titans.

Head southeast, however, and the picture has been far different.

There lies Chester, long the hidden and dangerous stepchild of the Philadelphia area--the relative you wouldn’t invite to family gatherings or with whom you wouldn’t let your children play.

Set along the same Delaware River that George Washington crossed on Christmas night of 1776 on his way to defeat the Germans and British in the Battle of Trenton, Chester was once home to thriving shipping and ship building businesses. Yet as the waterway economy changed and businesses crumbled, so did Chester, to the point the city was buried beneath a violent crime rate, decaying neighborhoods and high unemployment.

By the early 1990s Chester was home to an extensive complex of oil refineries, as well as four large hazardous and municipal-waste facilities--including the nation's fourth-largest garbage incinerator--America’s largest medical waste autoclave, and a sewage treatment plant and sludge incinerator.

It was the place visitors and residents alike did not want to get caught in after dark, where a crack deal could go down at any time of day or night. It was the place that, perception was, if your car broke down, you might not make it out alive.

But a rebirth has come to Chester in the past 15 years, as legislative and community efforts to provide renewal and revitalization have come to fruition. The streets got cleaner; white-collar businesses were enticed to the area through tax incentives, and residents found jobs.

And Chester is now on the verge of receiving its biggest boost yet—thanks to harness racing, slot machines, and a Pennsylvania government looking toward financing its future.

Come spring of 2006, Chester will be known as the home of Harrah’s Chester Casino and Racetrack—known around the sport as Chester Downs--the first harness “racino,” built specifically to cater to a dual customer base of slot machine and horse players. Under development by Harrah’s Entertainment and a trio of East Coast businessmen—spearheaded by former Pennsylvania legislator, and racing and casino executive Joe Lashinger--Chester Downs will feature a five-eighths-mile track that abuts the Delaware River and an open-air grandstand with glass accents that offers arguably racing’s most picturesque view.

Supporters of both the city and racing believe Chester will soon prove the bellwether whereby all other similar facilities will be judged.

“I think it’s a great project,” said Anton J. Leppler, executive secretary of the Pennsylvania Harness Racing Commission. “I’m not Nostradamus, but I believe this may become the second largest slot activity in Pennsylvania--after Philadelphia Park--because of where it is located. There are eight million people to draw from in just the surrounding area. And the partnership involved makes this a great opportunity for the equine industry in Pennsylvania.”

Racing dreams

Joe Lashinger is a man who knows how to make things happen.

As a Pennsylvania State Legislator, he helped revitalize Norristown from a decaying post-industrial town to a flourishing county seat. As a Standardbred-owning lawyer, he had coordinated legal affairs for the Pennsylvania Harness Horsemen’s Association and a number of Keystone State jockeys. As president of Pocono Downs, an officer at Penn National Gaming and a veteran of the casino gaming industry, he knew the intricacies of gaming.

Lashinger, who lives in the Montgomery County suburbs north of Philadelphia, is now taking all of those skills and experiences and throwing them behind his most recent and most ambitious project: the creation and development of Chester Downs.

“The real impetus behind Chester Downs was the desire to do something in racing on my own, not inside another company,” said Lashinger, who left the State House in 1991 after 14 years. “In my career I had spent large chunks of time on racing matters, and I owned Standardbreds and dabbled in some Thoroughbreds. I knew a racetrack could be profitable. I knew this was a good demographic, provided a track was built the right way. You can’t built $100 million tracks and expect them to be profitable. You have to do what the rest of entertainment industry is doing, and understand and adapt to your consumer.

“I left Penn National three years ago [in 2002], and this project started with a sit-down with horsemen that year. I would be a liar if I said slot machines [coming to Pennsylvania] were not in the back of my mind, but I was really committed to building a track.”

And Lashinger was committed to a harness track, having spent his 20s enjoying some of the finest racing in the sport at Brandywine and Liberty Bell.

“This state has a disproportionate amount of Thoroughbred racing,” he said. “I was racing my own horses in Delaware and shipping to Pocono Downs. There were plenty of people who lived in the Delaware Valley and owned horses racing at Pocono, and never got a chance to see them race live. “

To make that dream more realistic, Lashinger partnered with an old Delaware Law School friend, George Miller, and noted Philadelphia developer Kevin Flynn of The Flynn Company. It was Flynn who drew his partner’s attentions to the old Sun Shipbuilding and Dry Dock Co. site in Chester for development, even though Lashinger admitted he knew Chester came with some significant perception problems.

“I knew it had been a distressed community some years back, and the school district was involved in a state takeover,” Lashinger admitted. “It was a prospering city at one time. “The city had a vision for itself. [Its leaders] were very open-minded, though they were understandably a little reluctant when we first came in, because they had been stung by developers a number of times. It had become a dumping ground for projects people didn’t want elsewhere.

“We spent months working on the community to convince Chester residents and the community leaders that horse racing and gaming were a positive form of development.”

Lashinger and his partners original saw $20 million as a realistic investment to bring the track itself to Chester, but things changed dramatically on July 5, 2004, when Gov. Ed Rendell signed into law a bill that would provide property tax relief and increase state funds for education by allowing 61,000 slot machines in Pennsylvania—the most anywhere except Nevada.

The price to even apply for such a slot license: $50 million.

“When $50 million came on the table, the budget for the facility went from trying to keep it under $20 million to trying to keep it under $195 million,” said Lashinger with a  chuckle. “Now it’s blown to $265 million, and it’s continuing to increase.”

Lashinger and his associates quickly started looking for a new partner who knew gaming as well as Lashinger knew racing. They required anyone who wanted to talk to be prepared to be in the racing business.

Enter Harrah’s.

“We wanted to work with a racing-experienced company, as opposed to just one ‘active on the come’,” said Lashinger, utilizing a craps term for someone who is in for a quick score, and not in the game for the long run. “Harrah’s offered the whole package. It is a brand name people are familiar with. They have cross-promotions between all of their properties. And after they merge with Caesar’s, their  database will be unparalleled.

“Cross-marketing plans were part of the agreement. The other startups in the market will have to be out advertising, paying to build the customer base we already have. That will mean big business on the slot side.”

How big? About a $300 return per day per machine, in Lashinger’s estimation.

In a hurry

Annie Allman walks quickly through the reception area of Harrah’s Atlantic City, one of the Garden State’s premiere gambling facilities. Her auburn hair bounces along her shoulders as her heels click in rapid succession on the tile floor.

She talks as smoothly and quickly as she walks. She is clearly a woman on the move.

When her timeline is revealed, it is easy to understand why.

Allman is vice president of operations and assistant general manager for Harrah’s at Chester Downs, a thick title with lofty goals. It is her job to oversee that Chester Downs is designed, developed, staffed and operational by June 2006--the deadline set by the Pennsylvania Harness Racing Commission.

In true Philadelphia fashion, Lashinger may fit the role of Thomas Jefferson, the author of the Declaration of Independence that created a new political entity, but Allman and Harrah’s have become George Washington and the Congress, charged with making the ideal come to life.

“We are very conscious to right-size this facility,” said Allman. “This is not being built just for sire stakes day. It will be an exciting place to watch races every day—live or simulcast--in an exciting area that is on the cusp of resurgence.”

The industry-insider words that roll easily off Allman’s tongue--like “sire stakes” and “simulcast”—reveal the Alaska native is not a newcomer to racing. Her petite physique served her well as a Thoroughbred exercise rider on the East Coast, and as racing stable administrator for Bob Levy, the one-time owner of Atlantic City Racecourse who owned 1987 Belmont Stakes winner Bet Twice. Allman is already immersing herself in the harness industry with trips to The Meadowlands, Freehold Raceway and the Standardbred Horse Sale Company’s Harrisburg Sale.

Her equine background is also a benefit as she guides the first pure marriage of harness racing and casino life—starting from scratch with a clear vision for what will hopefully make both ventures a success.

“Unlike a lot of plants that retrofitted to accommodate slots, we want to better integrate the horse player with the slot player, and vice versa,” she said. “Horse racing is a beautiful sport. It deserves to be showcased.”

The racing end of the Chester project will feature a 1,500-seat grandstand fronted by 50 feet of a glass and simulcast facility on the first floor, augmented by food stands, a buffet, a 24-hour restaurant and an upper-level 300-seat Clubhouse and open patio seating. On the third level developers are aiming for a slot-player’s paradise, with 2,500 machines chewing up and spitting out coins around the clock.

There will be just a 15-foot apron between the grandstand and the racing surface. This up-close view for patrons is further complemented by elevated viewing platforms and an “owners’ box with viewing” on the paddock turn of the track, said Lashinger.

But unlike other racinos where the racing and slots never meet, all access into Chester Downs—be it via the eight-level parking garage (which will hold 2,500 cars) on the right side of the grandstand or the valet parking--will go through the pristine racing area. Racing will also be visible—and bettable--from the casino floor.

“Our first goal is to cross-market the customer base,” said Lashinger. “We are trying to integrate, as much as possible, the two products. I wanted to prevent what I saw happening at other racetracks and racinos—too many pre-fabricated or temporary structures used for racing customers, while casino customers wee treated to new amenities in the casino structure.

“There can be no more of the ‘Here are the slot customers and here are the racing customers.’ Look at a lot of the older plants. Restaurant space and common space have deteriorated. You’d see the gaming side getting all the attention in food and beverage. 

“From ground zero, we want to treat customers the same—and treat them well. Harrah’s has won Player Magazine’s award for customer service regularly. They get it. Their loyalty program is the strongest in the country. It’s unparalleled. Harrah’s has the industry’s best loyalty programs. We can create flow, traffic patterns to incorporate people into racing and gaming at once. When our horse customers get the same treatment as our casino customers, this will be a real rocket ship.”

Augmented by a marina and amphitheatre still in development stages, the Chester project will represent a $392 million investment in racing, wagering and Chester, according to Harrah’s Annual Stockholder’s report, issued March 1, 2005.

Because of the tight time line, racing will come first to Chester—featuring an afternoon post time--with slots to follow as soon as they are approved by the Pennsylvania Gaming Board. But Allman hopes simply having something new in the Chester area, and capitalizing on the Harrah’s brand name, will make Chester Downs a destination location long before the first one-armed bandit goes into play.

“There won’t be anything like it anywhere around,” she said.

Horse play

A drive onto the under-development Chester Downs site reveals the crumbling of the past giving way to the promise of the future.

Development officially began in April, after more than a year of demolition and environmental remediation. The site was home to the Sun Shipbuilding and Dry Dock Co., which launched its first vessel in Chester in 1917, just as the United States entered World War I. In the 1920s Sun Shipbuilding activities included construction of tankers for the Standard Oil Company, and in World War II it built 281 T-2 tanker oil carriers, as well as hospital ships and cargo carriers.

In February 1982 the site was purchased by the Pennsylvania Shipbuilding Co., which continued to build ships on the site until its closure in 1989. The site was purchased in 1994 by Metro Machine of Pennsylvania, Inc., to repair and dismantle military ships, but the Navy stipulated in 1998 that all such work would be done at the company's Philadelphia facilities.  

The state of Pennsylvania took possession of the property for unpaid loans totaling about $13.5 million in April 2001, and it was ultimately turned over to the Delaware County Redevelopment Authority. Though several businesses, including neighboring Kimberly Clark, expressed an interest in the property, it simply fell into disrepair until its purchase by Lashinger’s group, and its subsequent development by The Flynn Company.

The total site is 65 acres, 10 of which are under water, according to The Flynn Company’s Michael Koep. The area once housed 30 buildings, including the pipe, sheet metal copper, carpenter, fabrication and electrical installation shops, where each part of the giant ocean-going vessels would come to life before being placed in the 35-foot deep-docks built over the river.

Those buildings are, for the most part, all gone--stripped bare of their recyclable materials, torn down and carted away to make room for the parking garage and 15-race paddock (Chester Downs will host ship-ins only). But the largest of them—the fabrication shop—remains, its stripped and carved-out steel shell so cavernous and imposing, like a long-sunk underwater wreck, eroded by the elements. In a true testament to the workmanship that went into creating the Sun Shipbuilding facilities, Koep said the 1,300-by-200-foot building is simply so well constructed, it would cost more to tear down than to utilize.

The architecture firm of S O S H in Atlantic City--which has done work for Bally’s Park Place, Trump Taj Mahal and Aqueduct Racecourse, among others--instead designed the project so that the 85-foot-high structure would serve as the shell for the grandstand and casino.

“It is a steel frame on top of a concrete slab that is reinforced with steel,” said Koep. “We probably couldn’t build anything that strong today.”

Another remnant of the property’s shipbuilding past--although one the developers would gladly live without—is the deep-docks. Though the site would ideally hold a half-mile track, it was “written in stone; written in blood,” said Lashinger, that the horsemen would have a five-eighths-mile track on which to race. That meant the first turn would have to cross one of the deep docks—making Chester the only harness track in America to utilize a freeway-style overpass, though an Australian track employs the same design.

“I can’t tell you how many hours we spent moving this project around—even going so far as reversing the track or angling it so it ran under the fabrication plant—to make it fit,” Lashinger said.

The track is so close to the water’s edge that horsemen could easily throw their whips right into the Delaware River, and that proximity is expected to lead to a recreational center amid the racing plant and expanded food and entertainment—which blends with the leisure aspects of the river, said Lashinger.

Lashinger said Phase II may include both the marina and a hotel, while former Chester mayor and now-State Senator Vincent Pilleggi is also seeking the development of multi-family housing to be used for employees and Chester residents.

“There isn’t much about this that will feel like a racetrack,” said Koep. “There will be an incredible view across the Delaware River from just beyond the track. The grandstand will feel more open with wide, sweeping areas. This will be a place people will want to come to—and come back to.”

New life

Driving along Route 291 through Chester, it is easy to see how it earned the name Industrial Highway. Factories and commercial plants rise up along the roadways, billowing up with smoke and the acrid scents of production.

Driving into the center of the city, however, signs of progress pop up amid the long-evolving decay. A former Philadelphia Electric plant was rebirthed as the Wharf at Rivertown, and has since attracted such tenants as Wells Fargo Financial Acceptance and AdminServer, while RL Associates Inc. and Crozer Keystone Health Systems are just two of the tenants at the University Technology Park next to Widener University.

In the heart of town sits a new brick-and-glass structure in which the city government is housed. It is within these walls that Chester officials are working to bring respect to Pennsylvania’s oldest city, which was founded by William Penn in 1644.

Chester Downs is one of nearly 50 new development projects for the city, which between 1996 and 2005 has seen investment of more than $1 billion. The racetrack development is by far its biggest, with a $210 million Kimberley Clark plant investment project coming in a distant second.

“This will bring at least 900 jobs to our city and hundreds of thousands of dollars in tax money,” said David Sciocchetti, executive director of the Chester Economic Development Authority. “We expect this to bring $10 million to a city that has had a budget of $30 million. This will account for 30 percent of our budget—think about that.”

For its part, Chester had the shipyard site specified—with state help--as a Keystone Occupancy Zone, which creates substantial tax breaks on a property in an attempt to stir development in depressed areas.

And other Chester employers are also getting into the act. Nearby Widener University, which features a hospitality industry program, hopes to partner with Chester Downs by providing dining and hospitality assistance in exchange for on-the-job training for students in gaming, lodging and hospitality.

The Delaware County Chamber of Commerce has plans to hold seminars on owning and breeding, and its executive director has already bought some horses, according to Lashinger.

Not everyone is overjoyed about the arrival of Chester Downs, admitted Thomas Moore, chief of staff to Mayor Wendell N. Butler Jr. The League of Women Voters and various church groups have brought up concerns related to gambling, especially in a depressed area like Chester, where the bright lights of slot machines may suck in those who have the least money to spare.

But city leaders are tying to focus on the positive spin—namely the fact that Chester Downs will occupy and revitalize a long-dormant space, overrun with trash and vermin, and bring exposure to Chester the likes of which the city has never seen.

Even more significant, though, is the ultimate prize for Chester residents: jobs, jobs and more jobs.

Lashinger’s initial proposal listed 24 different types of positions under 11 different categories, including senior management, marketing services, data processing facilities management, food and beverage, backside (racing), parking and security. And the city of Chester promises even more opportunities.

“The development won’t stop with just Chester Downs,” said Sciocchetti. “We are looking at hotels and restaurants and other service businesses going up to support the track and the people coming to the track. We know there are negative connotations to a casino, and we are being conservative in our estimates so it does not appear we have unrealistic expectations.

“We see what positive impacts there will be, and the multiplier effect that will come from a development like this. It will finally be OK to come back to Chester.”

“We are nine minutes from the Philadelphia airport and 25 minutes from downtown Philadelphia, but who makes it a point to visit Chester?” added Moore. “This will give people a reason to come to Chester from all over the state—from New Jersey, Delaware, all over.”

Racing glory

The Web site for Harrah’s at www.harrahs.com includes a page devoted to Chester Downs, proclaiming the project is, “bringing back world-class harness racing to the Delaware Valley.”

It is easy to forget that the area once represented some of the best harness racing in the world. It was 1963 when Liberty Bell Park outside of Philadelphia came online, and Brandywine Raceway in Delaware was not far behind. Horses like Overcall, Rum Customer, Fresh Yankee, Super Bowl, Albatross, Nansemond, Rambling Willie and Most Happy Fella performed on the Pennsylvania ovals, guided by the sport’s best horsemen.

As racing struggled through the 1980s, however, few areas were impacted like Southeast Pennsylvania. Liberty Bell Park closed in 1985 and became the Franklin Mills Mall, while 1989 marked the end of Brandywine. All that was left were the dreams of Keystone State horsemen who now competed in central Delaware, New Jersey and elsewhere in their state at tracks like Pocono Downs and The Meadows.

Anton Leppler has two words for them: Welcome home.

“It has been a long time in coming, bringing harness racing back to [southeastern] Pennsylvania,” said Leppler. “It’s a fantastic site, but the developers have put their money where their mouth is, and bringing Harrah’s into the project makes this project look incredible.

“We have such a strong history of harness racing in that region. For so many horsemen it will be like coming home, but to an even better facility.”

Trainer Sam Beegle, who operates a training center in New Holland—about 45 minutes from the Chester Downs site—is ready for a track in his “backyard,” especially when it comes with the possibility of sport-topping purses and a facility that is the envy of countless others in racing.

Beegle estimated Chester Downs purses could quickly reach $200,000 to $250,000 a night. When spread over 150 dates, that makes for a program that Pennsylvania horseman can finally, in his words, “live on.”

“It’s been a struggle to be a Pennsylvania horseman,” admitted Beegle. “I feel very good about this project and the people behind it. Joe Lashinger and I have had horses together for 25 years. What you see with him is what you get. I hope with Harrah's we get the same thing, and so far, that’s what we’ve been seeing.”

A longtime member and former president of the Pennsylvania Harness Horsemen's Association,  Beegle said he sees Chester Downs as serving as a standard-setter for other jurisdictions, predicted that this track will be “as clean as possible in more ways than one.” He believes Pennsylvania will “set the bar very high” when it comes to “the bad guys.”

In addition, he hopes that having a successful facility will, in turn, breed success, as Pennsylvania owners, once prevalent in the sport, rediscover their passion through proximity, and reinvest in the sport.

“At one time the Philadelphia/Allentown/Reading/Lancaster area had a ton of owners,” he said. “I hope you will soon see the same thing.”

He also predicted that Chester Downs will become the standard by which countless other racinos are judged.

“Our bill in Pennsylvania is for the betterment of all of harness racing,” he said. “When this opens I hope I see a racetrack for the 21st century. It will be a five-eighths-mile track. The grandstand will allow slot players, if they want, to watch us race some horses. I hope they have the slot machines so full that they have to come over and see what we’re doing, and they like what they see.”

Leppler agreed.

“What I want to do is cross-pollinate those people,” he said. “We are going to have people coming in to play slots and play horses under one roof. When you come there, the same entranceway into races will take you into the slot area also. Once we get them in, we need to make sure they know what the racing is all about.

“We have one chance to do it right. This could be a win-win for everyone.”

On the horizon

Joe Lashinger has already seen what hope can do for the racing industry in Pennsylvania, as land is being gobbled up in areas nearby the Chester project--for horse farms, not housing developments. Economic development continues in the City of Chester in anticipation of the revitalization that will be brought and continued by the track.

And Lashinger believes reality will be even better than expectation.

Chester is one of the most misunderstood communities,” he said. “The biggest reward of this project will be the city’s and the county’s economic development benefit. This is going to spur growth up and down that river. Property values are up as people speculate on real estate all over the area.”

From a horseman’s perspective, Lashinger said to expect purses at the track to rival--if not outpace--The Meadowlands, as the slot money begins to pour in from what an independent auditor hired by Harrah’s determined to be the fourth-largest market in America for gamblers.

“In a few years years, I think this track will be thriving,” said Lashinger. “Harness racing will be in a  leadership role for the first time in a long time. I see a hotel here and other waterfront development and entertainment. Lastly, with my legislative hat reoccurring, I see quality housing becoming available in an area that has had a deteriorating housing stock.

“I can’t think of a better picture for harness racing or Chester.”

 


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