October 20, 2010
The latest salvo fired in the war over a planned slots parlor at Arundel Mills Mall comes by way of Indiana, of all places. Opponents of Question A claim that an ongoing dispute between the Cordish Cos. and the owner of the Indiana Live! casino demonstrates that the developer's plans for Arundel Mills are risky and his track record poor.
What's remarkable about this particular line of reasoning — already trumpeted in anti-Question A ads on the Baltimore airwaves — is that the evidence suggests just the opposite. By every measure available, Indiana Live! has been a financial success, but its connection to a racetrack appears to be a major part of its current dilemma.
Here's what is known: Indianapolis Downs LLC is seeking to terminate its deal with Cordish, the Baltimore-based developer that not only built but now manages Indiana Live! It hasn't disclosed why, but the consensus is that the company is mired in debt, teetering on bankruptcy and seeks to squeeze out more money from its assets.
As in Maryland, horse racing in Indiana is struggling, and the recession has only made matters worse. Indiana Live! was built at the Shelbyville track two years ago. In the industry, it's considered a "racino," a casino meant to subsidize the existing track.
How has Cordish Cos. performed? By all publicly available measures, the slots operation has excelled. According to the Indiana Gaming Commission, average daily revenue per machine is $338, and it's the fastest-growing casino in the state, on track to exceed its 2009 slots revenue of $211 million by 11.8 percent despite the fact it lacks table games, which some of its many competitors within the state are allowed.
But there are limits to how much a racino can do for a moribund industry. Not only is the owner of Indiana Downs in financial trouble, but so is the parent of nearby Hoosier Park, which filed for bankruptcy protection earlier this year.
What can be gleaned from this? Well, first and foremost is that putting a casino at a racetrack is no universal solution for what ails racing. That's worth noting, since some Question A opponents would like to see a slots parlor go to Laurel Park, something that is not necessarily going to happen if Question A fails anyway.
But the second point is that the Cordish Cos. knows how to generate slots revenue — which is, after all, the chief goal of the Arundel Mills project. If the Mills' planned 4,750 machines generate similar revenues to Indiana Live!'s, that's a robust $1.6 million a day, and the facility is likely going to do quite well in a larger market with fewer nearby competitors.
The most recent poll suggests the Question A vote is going to be close, and so the airwaves are likely to be filled by all kinds of claims and counter-claims. In that context, Anne Arundel County residents may find the Indiana Live! dispute instructive — just not in the way opponents have portrayed it.
