Odds On Racing - Harness Racing

Indiana Tracks Eye Expansions

November 19, 2007

Indiana's two horse racing tracks, which plan to add slot machines next year, are considering expansions that could include hotel complexes.

Officials from Hoosier Park in Anderson and Indiana Downs in Shelbyville discussed their plans Thursday during a meeting of the Indiana Horse Racing Commission. Rick Moore, general manager of Hoosier Park, said the track hopes to acquire land that could become the site of a convention center, a hotel, a spa and an ESPN-themed nightclub. "But those things can come in stages," Moore said.

"It's going to happen, but it's not going to happen overnight. We want this to become a destination spot."

Meanwhile, Indiana Downs attorney Lee McNeely said plans for the Shelbyville track include the addition of new racing barns and the optioning of 100-acres near the racetrack for a hotel complex. Both tracks are adding casinos to house slot machines after receiving approval from the Indiana General Assembly.

The $30 million Hoosier Park casino expansion is scheduled to be completed by June. The track's grandstand building is also being remodeled. Indiana Downs plans to build its casino development along Interstate 74 in phases, completing it by late 2008 or early 2009.

Racinos in Indiana
Television sets are everywhere at Fort Wayne OTB – on the walls surrounding both rooms for the more social bettors, and a series of individual screens for those who like more privacy.

In all, more than 250 screens carry live races from Churchill Downs in Kentucky to Belmont in New York to tracks in Florida, California – and, of course, Hoosier Park in Anderson and Indiana Downs in Shelbyville. On a typical day, races from about 30 tracks are simulcast from around noon until around midnight Wednesday through Sunday. Rarely do more than a couple of minutes go by without the chance to gamble on some race somewhere in the U.S. or beyond.

Bettors last year wagered nearly $114 million on the ponies at facilities owned by Anderson-based Hoosier Park, including live and simulcast racing at Anderson and the company’s off-track betting operations in Fort Wayne, Indianapolis and Merrillville. Indiana Downs, based in Shelbyville and with OTBs in Clarksville and Evansville, took more than $68 million in wagers. Those racetrack “handles” include winnings that were wagered again.

I spent my share during a September visit.

For novices like me, the OTB offers a “Wagering Made Easy” handout that explains the basics and outlines nuances and exotic wagering, like trifectas (pick the top three horses in order) and Pick 4s (pick the winners of four consecutive races).

I scanned the Racing Form, which lists each race and gives the minutia of each horse’s and jockey’s record. I focused on the selections of four experts for each of the races. The OTB also sells a Scratch Sheet that gives sort of the Cliffs Notes version.

I placed my bets on the first race by using a machine, and with employees at a teller’s cage for the other two.

In all, I laid down $43 over three races and won $11.65 – and that was not through skill but by betting on all the horses in the field to show, guaranteeing three winners in a race, an admittedly timid approach in my first-ever trip to an OTB.

While most other forms of gambling are pure chance (lotteries, roulette, slots) or a combination of some chance and some skill (poker, blackjack), horse racing appears to be one sport in which the bettor willing to do a lot of homework has a fighting chance of beating the odds, which always favor the house.

“Handicapping a horse race is a mathematical equation” said Bob Alderman, a former state legislator and current director of the Indiana Department of Transportation’s Fort Wayne district, who says he visits the OTB about once a month.

“I’ve been around horses since I was 12 years old,” he said. “I’m a $1 and $2 bettor. But it’s a fun challenge.”

But the numbers of people willing to devote the time, risk the money and enjoy the entertainment of betting on the ponies is dwindling, posing challenges and changes for horse racing, not to mention the state.

Horse racing is losing popularity nationwide, and Indiana’s two horse tracks and five OTBs are not generating the tax revenue Indiana officials would like. Indeed, revenues from the casino industry supplement horse-track revenues to the tune of $27 million this year.

Horse tracks paid $5.7 million into the state treasury last year, but the Horse Racing Commission spent $2.4 million regulating the industry.

Alderman, who was a state representative when the legislature approved the state horse tracks and OTBs, agrees that “it doesn’t make a lot of tax money for the state of Indiana.” But, he said, the tracks have helped nurture horse breeding in the state, driving up prices and creating jobs, helping grow the nascent Hoosier industry.

Still, “Horse racing all around the country, pari-mutuel racing, has taken a hard hit in the last 20 years,” said Ed Feigenbaum, who publishes the Indiana Gaming Insight newsletter. The newer horse track, Indiana Downs, has never operated in the black, Feigenbaum said. “It’s not a very popular sport anymore. Anyone who wants to gamble has other options.”

To help boost the tracks’ bottom line – as well as the state’s coffers – Indiana lawmakers this year joined the nationwide trend toward turning horse tracks into “racinos.” The General Assembly voted to allow each track to place 2,000 slot machines at their sites – at a staggering cost of $250 million per track, money that will go to Hoosiers in the form of property tax relief.

The racinos will also mark another direction for Indiana’s gaming industry – getting Hoosiers to spend their money on the slots.

Ten of the state’s 11 casinos are on the state’s borders and are designed to lure out-of-state gamblers. The 11th and newest is in French Lick, which also draws largely on a tourist trade as well as conventioneers. As a result, an estimated two-thirds of the $2.67 billion lost at casinos last year came from out-of-staters.

But Anderson and Shelbyville are in the center of the state, each about 30 miles from Indianapolis. For the racinos to succeed, Hoosiers will have to spend millions and millions of dollars at their slot machines.

With the racino law, Indiana lawmakers “are trying to kill two birds with one stone: ensure the continued collection of the gambling privilege taxes Indiana’s budget depends on and prop up Indiana’s racing industry, which, like racing industries in other states, needs machines to survive,” writes Jason Pawlina in the Oct. 19 issue of Insight – The Journal of the North American Gambling Industry.

Elected officials are also banking on continued tax revenue from the racinos to help finance future property tax relief.