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When it comes to racinos, Penn. knows how to package

May 27, 2008 7:00 PM

Burnt Offerings by Stan Bergstein | It is interesting and ironic, given the Atlantic City casinos’ stranglehold on horse racing in New Jersey, that major casino operators have led the renaissance of the sport in neighboring Pennsylvania.

In Jersey, where the casinos get just about whatever they want from the state, they recently and reluctantly agreed to pay a $30 million a year reparation to the state’s three racetracks in return for the tracks not getting slots for three years. "Getting them" and "seeking them" are two different matters, and the tracks, not satisfied with the temporary three-year arrangement, have not given up on using their formidable agricultural grassroots support in an effort to convince state legislators to grant them slots at Monmouth Park, Freehold Raceway, and the Meadowlands, capital of world harness racing.

In Pennsylvania, it is an entirely different story.

Pennsylvania is on its way to becoming a racing powerhouse, thanks to its enlightened slots law, and the engines driving the resurgence are Mohegan Sun, Harrah’s Entertainment, MTR Gaming Group, Penn National Gaming, and Cannery Casino Resorts.

Mohegan Sun is building a huge entertainment complex at its Pocono Downs harness track near Wilkes-Barre, at the northern tip of eastern Pennsylvania’s anthracite coal fields. It is building it in stages, energetically and ambitiously, and when it is completed the site will dominate the entertainment scene in the Pocono resort area and also have the region’s two largest cities, Wilkes-Barre and Scranton, in its immediate draw area.

Across the state, at another harness track, Cannery Casino Resorts’ The Meadows, just south of Pittsburgh, is in the midst of its own huge construction project. It tore down The Meadows grandstand, built 45 years ago, and currently is hosting gambling and racing operations out of a very big and successful temporary facility. It will be opening its gargantuan state-of-the-art new racino next year.

On the Delaware River, just south of Philadelphia off busy I-95, in what was the economically devastated town of Chester, Harrah’s Entertainment is operating a big and bustling new racino at its recently built Chester harness track. Business is brisk, and the gambling has gotten a jump on casinos being built in Philadelphia itself. The racing is major league harness racing, with fat purses that have attracted the best horses and drivers in the East.

Philadelphia Park, operated by English gaming interests, also is building major new facilities at its site in the northeast corner of the city.

Near the state capital, Harrisburg, ever-expanding Penn National Gaming is adding to the Keystone State’s new and impressive gaming facilities at its home base thoroughbred track.

In Erie, in the northwest stretches of the state, where thoroughbred racing failed before, Ted Arneault’s MTR Gaming Group is operating under a new lease of life at still another new track and racino.

Waiting in the wings is Indiana-based Centaur, which already owns Hoosier Park in Anderson, Indiana, 45 miles northeast of Indianapolis. A big and gleaming new racino opens at that track next Monday, and ready for its turn later in the summer is Indiana Downs, 30 miles southeast of Indianapolis, also with a big and brand new facility, even bigger than Hoosier’s.

Centaur, meanwhile, awaits impatiently and nervously for the Pennsylvania Gaming Control Board to issue its license. The board meets June 11, and Centaur faces an investors’ deadline of June 15. There is no indication the board will issue the license on the 11th. ... Its chairwoman has said they may not do so until fall, citing background checks as the cause. At stake is a $468 million project that will employ thousands in construction and later staffing jobs, but bureaucrats work at their own pace.

While slots have transformed Pennsylvania, they have not worked everywhere.

In Quebec, where the Loto-Quebec runs them, an experiment in which so-called "ludoplexes" next to racetracks, was expected to produce $36 million for the tracks. The tracks’ 22% cut of slots revenues produced only $8.6 million.

Quebec senator and business tycoon Paul Massicotte, who two years ago won the right to privatize all four of Quebec’s racetracks, and announced wildly enthusiastic plans for expansion of all of them, including a new track in Montreal, now stands on the brink of bankruptcy of his Attractions Hippique, the umbrella for the four. Worse, Quebec’s finance minister, Monique Jerome-Forget, says the government is not eager to bail out the industry again. The Montreal Gazette says the tracks are "on the ropes."

Call in the casino companies. If Pennsylvania is any measure, they can save the day.