Racetrack slots: a winner for some, a question mark for others

September 04, 2007 5:36 AM
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The gaming industry could use a good shrink. And so can the people trying to cover it.

The thunder of new slots operations has been heard across the land, but with uneven results. In some cases the noise was accompanied by wind and lightning, in others mild showers. To predict what might happen was getting difficult, other than to assume something would change.

Most puzzling, perhaps, was the underperformance of slots at posh Gulfstream Park in Florida and in Philadelphia, where expectations failed to materialize.

In Florida, however, changes in the state poker law have resulted in packed houses and full tables.

At Philadelphia Park, in the heavily populated northeast section of a major metropolitan city, slots have been an underperformer. That will not be helped by the departure of Hal Handel, a bright star in the racing firmament, who moved to New York City, even before the announcement that he was taking over as executive vice president and chief operating officer at beleaguered NYRA.

While Philadelphia slots were merely humming, 100 miles away, at Mohegan Sun at Pocono Downs, they were booming.

In Erie, in extreme northwest Pennsylvania, about an hour and a half drive equidistant between Cleveland and Buffalo, they opened what may prove to be a new pattern for horseracing last Saturday. The slots have been in operation since Feb. 28 under the shrewd management of Ted Arneault, chairman and CEO of MTR Gaming.

 He had this dream for Erie, where horseracing had failed miserably before at old Commodore Downs without slots, figuring his slots would enable him to offer purses that would drain horses from non-slots Maryland and non-slots Ohio. He opened his meeting promising daily purses of $500,000 a day, fueled by the slots income since February, putting little Presque Isle Downs right among the leaders in North American racing for purses.

He also boldly installed the first Tapeta track, an artificial surface developed by thoroughbred trainer Michael Dickinson, and it remains to be seen how that surface holds up under the wildly changing weather of a racetrack on the shores of turbulent Lake Erie.

Dickson, a smooth talker, already has given himself an out, saying the success or failure of Tapeta will depend largely on the skill of the track superintendent maintaining it. And the verdict of horsemen remains to be heard, although the lure of those giant purses will attract them regardless of the strengths or weaknesses of Tapeta.

Back in Florida, where there are 18 state-regulated card rooms, revenue blazed upwards almost 60% between June and July, reaching $7.7 million. The explanation was a new state law, which changed the game’s status from a friendly night out with elderly neighbors to a more sophisticated playing crowd.

Before July it was dollar and two-dollar game, limited to days when the tracks in Broward county were racing or offering jai alai. After the change, there is no such racing requirement, some games were boosted to $5 limits, and no-limit Texas Hold’em is allowed with a $100 buy-in.

This is not to say slots haven’t far exceeded poker, by a margin of two-to-one, and slots at the Isle Casino and Racing at Pompano Park and the Palm Beach Kennel Club have been holding their own, despite their disappointing showing at big and newly rebuilt Gulfstream Park.

The stylish high rise oceanfront apartments that flank Pompano and run both north and south of that track from Palm Beach to Fort Lauderdale and further south toward Miami are populated by an older generation with money. Many are friends from the north, and they enjoy a night out playing poker with people they know.

The Palm Beach Kennel Club added 20 tables, giving it what it says is the largest card room south of Atlantic City, packing in 600 players nightly. Its director, Noah Carbone, says it is drawing a crowd that had been playing home games, on cruise ships and on the Internet. Poker in Broward county zoomed from $770,000 in June to $1.33 million in July, with Pompano’s plush state-of-the-art new operation leading the way, rocketing from $280,300 to $635,000, compared to much larger Gulfstream’s increase from $124,400 to $294,100.

Beyond that, the Seminoles are lobbying for table games, and are likely to get them.

Call that shrink. Keeping up is getting dizzying.