No Dice for Massachusetts Racing, Breeding

 

The Massachusetts Gaming Commission said no dice to the state's Thoroughbred racing and breeding industry when it cast a preliminary 3-1 vote Sept. 16 in favor of awarding the sole Boston area casino license to Wynn Resorts instead of to Mohegan Sun, which planned to develop a destination resort casino on the grounds of Suffolk Downs.

 

The Wynn group will reappear before the gaming commission the morning of Sept. 17 and is expected to notify commissioners it will accept the conditions of the license. The commission will then take a final vote, although that is only a formality. 

 

The gaming commission's decision dealt a crushing blow to the state's Thoroughbred horsemen and to the 79-year-old track, the sole survivor of the 17 live Thoroughbred racetracks that once thrived in New England.

 

Without a planned $1.3 billion casino to be built at Suffolk Downs, principal owner Richard Fields and his partners maintained that it will no longer be economically feasible to continue live racing after the current meet ends Oct. 1. Wynn's $1.6 billion development will be located only two miles from the stable gate. 

 

"We are extraordinarily disappointed as this action is likely to cost the commonwealth thousands of jobs, small business and family farms," Suffolk chief executive officer Chip Tuttle said in a statement. "We will be meeting with employees and horsemen over the next several days to talk about how we wind down racing operations as a 79-year legacy of Thoroughbred racing in Massachusetts will be coming to an end, resulting in unemployment and uncertainty for many hard-working people."

 

If Mohegan Sun, which planned to site its casino on land leased from Suffolk's ownership group, had won the license, track owners would have continued live racing for a minimum of 15 years and implemented a $40 million racing improvement plan.

 

The horsemen, although taking nothing for granted, had been optimistic that the commissioners would vote for the Suffolk/Mohegan proposal as that would have preserved the industry and protected existing jobs. 

 

There are currently 1,500 direct and indirect Thoroughbred jobs in Massachusetts and the industry provides an annual economic impact of over $116 million, according to an independent 2013 study.

 

Moreover, their hopes were buoyed when the gaming commission voted Feb. 27 to award the single slots parlor license authorized by passage of the 2011 expanded gaming law, which also allowed three destination resort casinos, to Penn National Gaming Inc. 

 

Penn National Gaming proposed a $225 million casino at the state's only harness racing track, and at the time of that vote, the commissioners stated that preserving and protecting the Standardbred industry and the jobs it provided factored into their decision.

 

"The gaming commission's decision today is bitterly disappointing as our horsemen have worked so hard for so long to secure a bright future for Thoroughbred racing at Suffolk Downs and for our breeding industry in Massachusetts," said Anthony Spadea, the president of the New England chapter of the Horsemen's Benevolent and Protective Association. "Now our entire industry has been shut down. 

 

"There are many Massachusetts horsemen who could have moved away and raced elsewhere or sold their breeding farms and open green space to developers, but they stayed here over the years and invested in racing with the hope of what might have been. Now that hope is destroyed as they will all be out of business."

 

George Brown, the president of the Massachusetts Thoroughbred Breeders Association, is the owner of Briar Hill Farm. It is the state's largest breeding farm and has been in Brown's family since 1850. Prior to the vote, he said the commission's decision would be critical to the survival of the breeders.

 

"This decision creates a black hole for a lot of people," said Jay Bernardini, Suffolk's leading trainer with 40 horses in his barn.

 

Bernardini, who had already planned to race at Laurel Park after the meet, said he currently employs 10 to 15 people but will take only six to seven people with him. He added he is uncertain of where he will race in the spring after stabling at Suffolk for 30 years.

 

The gaming commission decision in favor of Wynn also affects the Thoroughbred horsemen's share of future monies to be collected and allocated by the commission's Race Horse Development Fund (RHDF), which was established in the 2011 law to protect the racing industry in the face of casino competition. 

 

The law authorized three destination resort casinos is separate geographical regions and one slots parlor to be located anywhere.

 

The RHDF will be supplied by 5% of the $175 million total licensing fees plus 9% of the future slots revenue and .625% of the gross gaming revenue from all three casinos. Earlier this month, the gaming commission signed off on splitting that revenue 75% to the Thoroughbred industry and 25% to the Standardbred industry, with 80% of each allotment going to horsemen, 16% for breeders' incentives and 4% for backstretch welfare.

 

Now that money will be put into escrow for three fiscal years to encourage the construction of another Thoroughbred track. Nonetheless, the possibility of investors opening a new track without a casino and having to compete against three destination resort casinos and a slots parlor is extremely remote.

 

The gaming commissioners did impose a condition on Wynn that it give preference to "qualified" current Suffolk Downs employees when hiring for its development. That is little consolation those who will lose their livelihoods, especially since the Wynn casino may not open until 2019.

 

The is a possibility that the decision in favor of Wynn, and of Penn National Gaming, may be moot if the statewide referendum on the November ballot to repeal the 2011 expanded gaming law passes. But a recent poll of registered voters in Massachusetts indicated they favor letting the law stand.