Virginia's New Race Course May Give Md. Tracks a Long and Prosperous Ride

November 06, 1994|By STEVEN CRIST

The introduction of pari-mutuel horse racing in Virginia is a risky venture that has the potential to pay big dividends to Maryland's beleaguered racing industry.

Pari-mutuel horse racing has a dismal record in the handful of states that have tried it over the past decade, but there is good reason to believe that Virginia will buck the trend.

The Virginia project appears to have a lot going for it to begin with, and its inclusion in a circuit with Maryland tracks guarantees that it will not be a struggling orphan. If management takes the correct approach with its customers, and simulcasting and off-track betting are winners, Virginia looks like a good bet for a long and prosperous ride.

Joseph A. De Francis, the owner of Laurel Park and Pimlico Race Course, has predicted that Virginia bettors will pump millions of dollars in much needed revenue to his Maryland tracks, which lost a combined $7.2 million last year.

Under an agreement between racing officials in the two states, Maryland tracks will close to live racing during the summer when thoroughbreds are running at Colonial Downs, the Virginia track expected to open in January 1996. Maryland fans will be able to bet on television "simulcasts" of races run elsewhere, including Colonial Downs, which will be managed by the Maryland Jockey Club.

When the Maryland tracks reopen, the Virginia facility will close and its network of a half-dozen off-track betting facilities across rTC Virginia will carry Maryland races in addition to races from other areas.

Betting must measure up to expectations for the circuit to be successful. The venture is built on the presumption that purses -- derived from the dollars bet -- will be sufficiently high to get Maryland owners to send their horses to the new track.

Reviving interest

Virginia, like the industry as a whole, must find a way to revive interest in thoroughbred racing, which is bottoming out as a live attraction.

After enjoying a charmed status for much of this century because of its virtual monopoly on legalized wagering, the racing industry is now competing with state lotteries, riverboat gambling, Indian-owned casinos and the increasing popularity of illegal sports betting.

Racing still ranks near the top of the list every year in total attendance but only because there are so many racing cards run each year. Average attendance has been plummeting steadily. The main reason for the sport's decline in prominence, the industry has belatedly realized, was its initial reluctance to be part of the television-sports revolution.

Short-sighted track operators spurned television, fearing that customers would stay home and bet with illegal bookmakers if the races could be seen from the comfort of one's living room. As a result, an entire generation of sports fans grew up with little or no exposure to racing. That generation in turn grew up to be today's sports editors and television executives, almost all of whom have relegated racing to the level of bowling and dog shows rather than football or basketball.

The only way in which racing has benefited from the boom in other forms of legalized gambling is that increased public acceptance of wagering has led to ballot initiatives permitting racing in states where it was previously prohibited. In all cases, racing was introduced amid high hopes and rosy projections. And in call cases, the results have ranged from disappointing to disastrous.

In Minnesota, a wildly successful opening meeting was followed by years of steady decline and business was virtually ruined by the opening of a casino. In Alabama, ridiculously giddy projections of business despite a poor local economy were off by nearly 100 percent, and the original operators were forced out of business. The track has since reopened at a far more modest level.

The venue everyone was predicting would be an instant hit was Texas, where racing began at Sam Houston Park last spring. It seemed a sure-fire undertaking, since Texas and Texans have had a long-standing affinity for horses and gambling. Once again, though, estimates were off by nearly a factor of two, and race purses have been repeatedly reduced because of lower-than-expected business.

The racing industry must look to innovations if it wants to prosper. The words "off track betting" raise red flags in most people's minds because of the disastrous execution of that concept when it began in New York in 1973. OTB was set up as a separate political entity rather than an arm of the tracks, and has grown into a political monster that has crippled New York racing.

Virginia is counting on good business at six OTB centers located in Richmond, Hampton, Chesapeake, Virginia Beach and Portsmouth.

The final frontier in simulcasting is the ultimate in customer convenience: home betting, which is where the smart money believes racing's future lies.

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