As gambling shows strength, Illinois horse tracks renew call for slot machines
The horse racing industry in Illinois is struggling to keep up with other states.
Like most other industries across the country, gambling took a big hit during the recession. However, there are signs it is on the way back.
Gambling on the Las Vegas strip increased for the second straight month in December, totaling $502.2 million, a 5.9 percent jump from the year-earlier period.
Here at home, Hawthorne Race Course in Cicero began its live horse racing season last weekend. While it’s the middle of February, opening weekend came none too soon for die-hard Eugene Tenuta of Westchester, who has been going to the track for more than 40 years.
“I like the action, I like the thrill of the horse racing,” Tenuta said. “On an average day, I’ll bet a couple hundred dollars.”
It’s probably no fault of Tenuta’s, but Hawthorne has seen handle, or money wagered at the track, drop from $310.7 million in 2006 to $287.1 million in 2007 to $237 million in 2008, declines of 7.6 percent and 17.5 percent, respectively. Assistant General Manager Jim Miller said the track was down an additional 6 percent in 2009.
It’s a similar story at tracks across the state, with total handle down 10.1 percent from $631.3 million in 2006 to $567.8 million in 2008. It has fallen every year since 2002. That has resulted in less tax money for the state, as the $7.9 million in revenue the state pulled in from the tracks in 2008 was down 11.2 percent from 2007 and 13.6 percent from 2006.
Tracks like Hawthorne have been trying to come up with new ways to make money for years. Last October, the Illinois Racing Board licensed three companies to accept online wagers on horse races in the state. Tim Carey, owner, president and general manager of Hawthorne, projects this will create quite the windfall.
“Now that Twin Spires, TVG and Youbet are in the marketplace, it will do about $120 million in 2010,” Carey said.
There’s no doubt that legalized online betting will generate more money for the state, but Carey believes there’s something else out there that will create millions in tax dollars for Illinois while also creating jobs. Namely, he wants to place slot machines at racetracks across the state. The owners of Illinois racetracks submitted a bill last week asking for 1,200 slots at the tracks in Cook County and 900 and those in all other counties.
“With towns opting out of video poker [after passage of the Video Gaming Act], there’s a shortfall in the Capital Bill,” Carey said. “We can be the solution.”
But what about those who say the racetracks are just looking out for themselves? Carey readily admits the tracks would benefit financially, but added that it’s an important industry for the state that is falling behind its counterparts throughout the country.
“If racing wants to sustain itself in Illinois, we have to be competitive with other states, and other states have slots in racetracks, so their purse structure is higher than it is in Illinois,” Carey said.
Any revenue generated by the slot machines would go toward the handle. The handle determines the size of the purses paid to horsemen and owners. With larger handle and larger purses will come better racing and more racing dates. That can lead to increased tax dollars for a state that could desperately use them.
Tags: Capital Bill, gambling, horse racing, online gambling, Sports, taxes
The gambling Bills that the race tracks are running only benefit themselves and not the horsemen. It will give them a casino and allow them to cut racing days that will bankrupt the horsemen
That reply is entirely untrue, Robert. Horseman would actually see an additional $10m to as much as $30m in purses per year from Hawthorne’s slots alone. And, the tracks don’t choose their racing days…the state does. In general, I don’t see why everyone is so up in arms over slots at tracks. If you can play them in a bar or at a restaurant, where gambling ISN’T the main reason you attend, why shouldn’t you be able to play them at a venue that’s actually meant for betting/entertainment? If you’re going to be against it, be against it everywhere, but don’t make arguments based on convenience.
Thanks for reading and the comment Robert. It is true that allowing slots at racetracks, which is what the bills propose, would benefit the horsemen. The slots would contribute to the total handle, which goes a long way to determining the size of the purses, of which the horsemen receive a cut. More handle equals larger purses, and the horsemen would receive the same percentage of a larger pie.