Odds On Racing - Harness Racing

Ohio Eyes Track Slots Again

February 18, 2010

With developers preparing to break ground on the casinos that voters approved in last year's ballot issue, lawmakers are taking a second look at legislation that would allow the state's seven racetracks to install slot machines.

Members of the House State Government Committee also heard testimony Wednesday on proposals designed to strengthen the hand of charitable organizations that run bingo operations.

Chairman Rep. Ronald Gerberry (D-Austintown) said he supports a bill (HB 250) that would authorize the lottery to install as many as 2,500 video lottery terminals at the state's horseracing tracks, but hasn't yet gauged support among committee members.

"Where we go with this at this point, I'm not sure. But I think its something that should be aired," he said in an interview.

Gov. Ted Strickland planned to implement a similar lottery expansion to shore up last year's budget shortfall, but the Ohio Supreme Court subsequently ruled the measure was subject to a referendum.

Chairman Gerberry said he believed passage of the bill would trump constitutional challenges, which were based on the governor's authority to administratively expand gambling through the lottery, he said.

"Now with casino gambling okayed by the people of the state of Ohio, I think it gives us an indication that the people are at least somewhat accepting, that this is somewhat palatable," he said.

Proponents' assertions that the bill would rescue the dying horseracing and breeding industry and boost economic development in surrounding communities are compelling, he said.

"If we're going to save this industry, the state's got to act and doing nothing is not an adequate response," Chairman Gerberry said. "We got casino gambling in this state the way we got it because the legislature didn't act."

The proposal will likely have to be revised to address the reality of Issue 3, which authorized four casinos in Columbus, Cincinnati, Cleveland and Toledo, he said.

Proponents noted the casinos' 33% tax rate is substantially lower than the 50% for racetrack VLTs in the legislation.

Attorney C. David Paragas, general counsel to the Equine Agricultural Coalition, said that the different tax rates warranted revision.

"We want this to be a robust and productive program. Accordingly we think there needs to be some adjustments," he said in response to a question from Rep. Brian Williams (D-Akron). "With appropriate modifications we are confident that we can deliver."

Mr. Paragas said the bill would not only preserve the horseracing industry's 20,000 jobs and $850 million in economic benefits for the state, but would create 7,000 new jobs and an additional 10,000 indirect positions.

"The challenges of Ohio's horseracing industry cannot be overstated," he said, noting surrounding states have expanded gambling options at competing tracks. "Without additional gaming offerings such as video lottery terminals, Ohio's race tracks cannot compete with either surrounding state's gaming venues or Ohio's soon to be developed casinos."

Steven McCoy, president of the Ohio Harness Horsemen's Association, said permitting VLTs at racetracks would reverse the decline in the industry, which suffered a 70% decrease in breeding between 2004 and 2009.

"We've already lost jobs and we're struggling and hanging on by our fingernails and hoping for some relief," he said.

"The expansion of gaming at Ohio racetracks will give the stat in general and the horseracing industry in particular a tremendous economic boost at no expense to the taxpayers," he said.

Dave Basler, executive director of the Ohio Horsemen's Benevolent and Protective Association, said he strongly supports the concept of racetrack VLTs. But the he asked for language that would ensure Ohio breed funds receive a cut of the revenue.

The gambling revenue that would go to the track operators should be shared with others in the industry, he said.

"How that remaining 7.5% is split will determine if this legislation results in helping Ohio's horse industry, which includes the people I represent, as well as veterinarians, feed stores, grain operators, blacksmiths, truck and trailer salesmen, Ohio farmers and other racing industry supported jobs and business, or whether it will simply mean we will have seven successful slot parlors," he said.

Responding to a question from Rep. David Daniels (R-Greenfield), Mr. Basler said the current language offers no revenue for horsemen.