Slots Losers
As maddening, petty, and inept as I found New York state politics during the four years I lived in Brooklyn — particularly when it came to anything having to do with the Aqueduct racino or OTB — the explanation for the ostensibly irrational often lay in asking, cui bono? Because someone was usually, pretty nakedly, making out in campaign cash, political power, or patronage jobs. Not so in Massachusetts state politics, which are no less maddening, etc., for reasons that more often seem opaque, personal, or tribal.
Take, for instance, the apparently dead expanded gaming legislation. Never before, in almost two decades of debate, has Massachusetts come so close to allowing casinos and racinos. In the final hours of the legislative session on July 31, the House overwhelmingly approved a bill authorizing three casinos and two racetrack slots licenses. The Senate approved the same, two votes shy of a veto-proof margin. The governor, up for re-election, said he’d accept three casinos (his original stance), but only one racino, a compromise position he then backed off, returning the final bill with an amendment effectively killing racetrack slots. Explained Patrick of his reversal:
“We do this over and over again in the Commonwealth: We yield to the short-term interests of a few powerful people, and we set aside the long-term, best economic and social interests of the Commonwealth.”
There are those holding out hope that the legislature will be called back into session and that a resolution will be reached. I’d price that happening as a longshot so long the tote board tops out at 99-1. House leader Robert DeLeo — whose district includes Suffolk Downs and Wonderland, and who’s expended tremendous political capital accomplishing more than anyone ever has on the issue — has dug in, insisting on two racinos. “Asking me to go further than that is truly unreasonable,” he told the Boston Globe. Senate president Therese Murray is skeptical a deal could be reached, and quietly, stubbornly opposes calling lawmakers back.
Meanwhile, Plainridge, the state’s sole harness track, has already announced layoffs. Suffolk Downs has made no statements, but the rumors about the track’s future are wild and ominous.
Cui bono? No one.
2:45 PM Addendum: Tweets @jenmontfort, “It’s just so disappointing to be so close and to let political tomfoolery (on ALL sides) get in the way.” Exactly. And yet, it’s hardly surprising. This is the state, after all, where tomfoolery once led to the simulcasting law expiring on the eve of the Florida Derby.
Pay-to-Play
12/10/08 Update: More on the alleged pay-to-play scheme involving a horseracing bill this morning — “I’m shocked, disappointed and befuddled,” said Lanny Brooks, executive director of the Illinois HBPA. “This is a bill that we had every expectation would be signed within a week or two.” Also being reported — “before signing the bill, the U.S. Attorney’s office charged Tuesday that the governor wanted $100,000 campaign contribution, reportedly from a racetrack owner.” No confirmation on that last detail.
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As if the story of Illinois governor Rod Blagojevich being arrested on corruption charges wasn’t juicy enough, there’s a small horseracing angle. From the Justice Department news briefing on the case:
A second example [of pay-to-play] is legislation that is pending concerning horseracing. There is a bill that I believe sits on the governor’s desk that would take money from casino revenues and divert a percentage of it to horseracing tracks. While this was pending, the interceptions show that the governor was told that one person who he was seeking to have raise $100,000 also was working with a person who was seeking that money to have a bill pending.
And the governor was told that the person who wanted that bill — from whom they wanted money — was told the following: that he needed to get his contribution. And the quote was, “Look, there is a concern that there is going to be some skittishness if your bill gets signed because of the timeliness of the commitment,” closed quote. Then the person told the contributor, the money, quote, “got to be in now,” closed quote.
And when the governor was told this part of the conversation, his response was, “Good.”
Shortly thereafter, the person who was trying to get the contribution from the person who had the bill pending suggested that the governor call the person directly, that it would be better to get the call personally from the governor, quote, “from a pressure point of view,” closed quote, and the governor agreed.
As we sit here now, as far as we know, that bill sits on the governor’s desk.
The bill, which grew out of an earlier bill mandating casinos share revenues with the state racing industry and would release $80 million from an escrow fund to racetracks, passed the Illinois legislature last month. “[State Rep. Jay Hoffman] said Gov. Rod Blagojevich has always been supportive of the horseracing industry and he expects the governor will sign the bill” (Belleville News Democrat). Sounds like Blagojevich would have been happy to do that, at a time convenient for “Contributor 1.” (And who could that have been?)
Related: Ray Paulick catches readers up on the racing roots of Illinois corruption.
De Francis Says He’d Forgo %
I can’t believe the Bug Boys didn’t jump on this story: Ace reporter John Scheinman reports in the Washington Post today that outgoing Maryland Jockey Club executive Joe De Francis would relinquish his rights to slot machine profits if it would help gaming legislation pass in the state legislature:
“Sure, absolutely,” De Francis said. “I can’t speak for my partners, but I can speak for me. In order for [the Maryland racetracks] to be viable, the playing field has got to be leveled and slots have to come to Maryland to allow the Maryland Jockey Club to be competitive with Delaware Park, Charles Town and Philadelphia Park.”
Magna announced on Monday that it had exercised its option to buy the remaining 49% interest in the Maryland Jockey Club held by De Francis and his sister, Karin De Francis, a deal that did not affect an agreement between De Francis and Magna entitling him and partners to future slot profits. The share of gaming proceeds due to racetrack operators has been an issue in previous attempts to pass Maryland slots legislation.
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In slots news further up on the East Coast, both Boston mayor Tom Menino and Massachusetts governor Deval Patrick have shot down a proposal floated by Suffolk Downs to build a temporary casino at the track if it was granted a slots license in 2008, reports the Boston Globe:
“I’m not interested in temporary licenses,” said Patrick. “I’m not interested in a piecemeal approach. We put out a comprehensive plan, because we think a comprehensive plan with those terms and conditions is what will and can work in and for Massachusetts and that’s what we intend to stick to.”
Menino, who has been advocating for a casino at the East Boston horseracing track, said he was blindsided by a Sunday Globe story that said if granted a casino license by the state in 2008, Suffolk Downs’ owners could be ready to go with a 180,000 square foot temporary facility, equipped with slot machines and gaming tables, as early as July, four years earlier than the governor’s plan envisions. The temporary casino would remain in place during development of a full-scale entertainment complex.”If this is going to be successful,” said Menino, “it has to be a destination resort.”
Suffolk COO Chip Tuttle said the plan was merely one piece of a proposal submitted to the governor’s office and that the track has no plans to move ahead without the support of state officials. Governor Patrick offered a plan last week to auction three casino licenses in the state; Suffolk is expected to be among the bidders.
9/30 Addendum: Dan Kennedy has an excellent post up on the results of the recent Boston Globe poll on casino gambling. Basically, Massachusetts residents say yes to gambling, no to casinos anywhere near them.
DiMasi Cashes In?
The Boston Globe picks up today on the story, reported by the Boston Herald yesterday, that Massachusetts House speaker Sal DiMasi has accepted nearly $4,000 in donations from gaming lobbyists and companies such as Harrah’s and GTech since 2002, including $500 from Harrah’s CEO Gary Loveman. Bay state slots supporters blame DiMasi for killing slots legislation just a couple of weeks ago with his statements about the “social cost” of gaming and apparent lack of concern for the state’s racing industry, and the Herald insinuates in a follow-up article that the contributions from Harrah’s and other out-of-state gaming companies, fearful of competition between Rhode Island casinos and Massachusetts slots, may have influenced the speaker. Such an argument though ignores a few inconvenient facts, like that Harrah’s would love to build a casino in the state — the company has been angling for years to do something with Suffolk Downs. Rather than a case of DiMasi and other anti-slots lawmakers cashing in, this may well be one of “politics as usual,” a non-story of lobbyists covering all their bases and politicians accepting all contributions without question. I’m sure a study would reveal similar gaming company contributions to influential pro-slots legislators. If the slots vote had gone the other way, would the Herald now be running articles suggesting that Senator president Robert Travaglini had sold out for $500 from a casino operator?
Mass. Slots Bill Rejected
After hours of contentious debate, the Massachusetts House dealt a devastating blow to the state’s racing industry on Wednesday evening, voting 100-55 to kill a bill allowing the installation of 2,000 slot machines at each of the state’s four racetracks.
“The Massachusetts House of Representatives is killing the industry,†said representative David Flynn. “We’re strangling the tracks.”
The debate on the bill, which was passed by the Senate last fall, lasted for nearly six hours, as several legislators on both sides of the issue addressed the chamber, including representative Dan Bosley, a longtime expanded gaming opponent, and representative Kathi-Anne Reinstein, whose district includes Suffolk Downs and Wonderland dog track. Bosley opened the debate by lambasting the claims that slots would either save jobs or bring in substantial revenue to the state, and said that if that the bill, “doesn’t bring back our money from Connecticut, if it doesn’t save the jobs it is purporting to save, we shouldn’t do it,” while Reinstein held up photos of Wonderland workers who could find themselves unemployed without slots. “This legislature cannot afford to throw away thousands of jobs and millions of dollars,” she said. “If you vote [against the bill], you are voting against local aid, you are voting against working class families.”
Before House speaker Sal DiMasi came out against the bill last Friday, slots supporters estimated that they had enough votes to pass the bill, although not enough to override a veto from governor Mitt Romney. Flynn, whose district includes the Raynham dog track, blamed DiMasi’s “arm-twisting” for the loss of support.
After the slots bill was rejected, the legislature voted 141-13 to renew the state’s simulcasting law through the end of the year. Three of the state’s racetracks, including Suffolk Downs, have been closed since last Saturday, when simulcasting legislation expired. Suffolk plans to reopen Friday afternoon for simulcasting.
More: Lowell Sun racing correspondent Paul Daley finds fault with the legislators and the track owners for the bill’s defeat. “Believe me, there’s enough blame to be shared by both sides.”
Simulcasting Expires
Because state lawmakers couldn’t agree on how long to extend the Massachusetts simulcasting law and track owners couldn’t agree on the number of races each was allowed to show, the legislature adjourned Friday without renewing the simulcasting law, which means simulcasting expired in the state at midnight Friday. Up to 80 employees may be laid off from Suffolk Downs, which will be closed at least through Monday, and Massachusetts racing fans won’t be able to bet on Saturday’s Florida Derby at either Suffolk or Plainridge.
Slots and simulcasting are closely linked in the state right now, and some slots supporters think that the simulcasting shutdown will put pressure on House members to vote yes when the slots bill comes up for debate on Wednesday. Revere representative Kathi-Anne Reinstein sees just such a political silver lining in the situation:
”It’s going to bring more people to the State House to show people that they need to be employed,” Reinstein said. ”There’s no other way to do that than to have them out of work.
”I never hoped it would come to this, but, now that it has, I want everyone at the State House,” she continued.
Suffolk spokesman Chip Tuttle said the Florida Derby is usually a big day, with more than $1 million wagered, and expressed concern for workers:
”There are lots of employees who live paycheck to paycheck, and the idea that they’re going to be out of work for four or five or six days, with no certainty of when they come back to work, is disturbing,” he said. ”They’re very disappointed.”
When House speaker Sal DiMasi called Massachusetts racing a “dying industry” he was right. Look at the the revenue numbers for 2002-2004: Every source of handle is in decline. And when union representative Louis Ciarlone asserts that the industry isn’t dying, “it’s an industry that’s being killed,” he’s right too. Until the simulcasting bill is renewed by the legislature, significant dollars will be lost by tracks that can ill afford to lose any money. But there’s plenty of blame to go around. As this latest snafu illustrates so well, the state’s racing industry is doomed as much by the track owners as it is by the lawmakers.
Mass. Slots Watch
With April 5 set as the date for the Massachusetts House to debate a slots bill passed by the Senate last fall, both sides are advocating their positions with increasing vigor. The New England HBPA and the track employees’ union took out a quarter-page ad on the Boston Globe editorial page this morning (click the image to view the ad in full) that iterates the argument that gambling money leaving the Commonwealth now could be recaptured, while House speaker Sal DiMasi has officially come out as a slots opponent. The Boston Herald reports that the speaker’s “top lieutenants” are pressuring individual lawmakers to vote no on the bill: “The fix is in. It’s just like the old days,” said one Beacon Hill insider. “The word has gone out. He doesn’t want it.”
Speaking to the Greater Boston Chamber of Commerce today, DiMasis said, “I look at what has been going on in the racing industry, and it seems to be a dying industry,” and predicted that the slots bill would be defeated in the House. “I don’t think the support’s there that people think there is.”
That DiMasi has broken the silence he’s maintained on the slots issue for the last 18 months with such strong statements this week has deflated slots supporters who thought there was a strong chance for the bill to pass this year:
”If this is a vote that’s free and clear, we do have the votes to win it on the floor,” said Representative Kathi-Anne Reinstein, a Revere Democrat whose district includes Wonderland. ”If there is influence, of course, we lose.”
Supporters estimate that 90 out of 160 legislators in the House may vote yes on the bill, which falls short of the 106 that’s needed to override governor Mitt Romney’s expected veto. But it’s likely overriding a veto won’t be a concern after April 5. If the influential speaker of the House predicts that a bill won’t pass, “you can pretty much well … bet on it not passing.”
More: Slots legislation archive
Mass. Slots Watch
More than 100 racetrack employees, horse owners, and local politicians rallied in front of the Massachusetts State House on Monday in support of a bill passed by the Senate last fall that allows up to 2,000 slot machines to be installed at each of the state’s four racetracks and which has languished in the House since. Legislators are meeting today to set a date “to formally debate” the bill, which was to have been voted on in March according to an agreement made last December. It’s now expected that the legislature will take action on April 5, a delay that’s angered some slots supporters.
More slots links: Suffolk Downs is now maintaining a news page with links to relevant articles from newspapers across the area.
Mass. Voters Back Slots
Massachusetts racetrack owners could get the slots they wish for this spring. The state Senate passed a bill allowing slots machines last fall, and a vote on the issue is due to come up in the House next week. Supporters claim a narrow majority in the House, with an estimated 86 of the 160 members ready to say yes to slots (although, it must be noted, that’s not enough to override governor Mitt Romney’s anticipated veto). Even Massachusetts voters are getting on the slots bandwagon. According to a Boston Globe poll:
Fifty-three percent of voters surveyed said they were in favor of legalizing slot machines, and 41 percent said they were opposed, while 6 percent said they were neutral.
The poll also showed that out-of-state travel (to casinos like Foxwoods and Mohegan Sun in Connecticut) for the purpose of gambling is quite real:
Nearly a third of all respondents said they had traveled outside Massachusetts in the past year specifically to visit a casino or gaming facility.
While things are looking good for those who favor expanded gaming, the outcome of the House vote — whenever it’s scheduled — is hardly certain. Anti-gambling state representative Dan Bosley “is rallying his troops” to stop the legislation, and House speaker Sal DiMasi’s attitude towards slots could be called noncommittal at best.
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Racetrack employees are planning a rally at the State House next Monday to show support for the slots bill.
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More on slots from the 3/16 edition of the Boston Globe: An opinion piece by Steve Poftak argues that the proposed $25 million licensing fee each track would have to pay to install slots is too low:
If we assume that each slot machine generates revenues at a rate of $285 per day, which was the figure used by the Maryland Legislature during their deliberations on a similar casino bill, the net present value of income, after the state’s share and expenses, tops $600 million. This suggests that a recurring fee of $85 million per license would be closer to the true value.
Poftak makes a lot of the same points that an article in the Boston Herald did a couple of weeks ago, which also took note of what happened in Pennsylvania, where slots licenses were granted for a $50 million fee:
… some of the world’s biggest gambling companies have since paid hundreds of millions to gain control of the tracks and the slot licenses — far more than the $50 million charged to the state. The winners, in these cases, were not taxpayers, but racetrack owners who benefitted hugely because the industry bid up the value of their gaming licenses.
That sounds like bad news for taxpayers, but is it for racing?
Slots May Have a Shot
Massachusetts slots supporters believe legislation allowing the machines at the state’s four racetracks has the best chance of passing in years:
“My sense of this vote is we have a really good chance — the best chance we have ever had,” said Louis Ciarlone, president of Local 123 of the International Brotherhood of Electrical Workers, which represents 200 Suffolk Downs workers. “This is the World Series.”
A vote on the slots bill passed by the Senate last fall (or one very like it) has been scheduled in the House for the week of March 20. The Senate bill was approved by a veto-proof majority; the same is not expected of the House vote.
More: Opponents worry slots will infringe on lottery revenue:
State Treasurer Timothy P. Cahill, who opposes slot machines at the racetracks, said it’s an open question how much the lottery would be affected. But he’s convinced it will suffer.
A report from Christiansen Capital Advisors in January concluded that it wouldn’t.
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Jessica Chapel writes and edits in Massachusetts. Railbird is a Thoroughbred horse racing blog published from June 2004 to July 2019. More / Contact
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