“And they’re OFF!”, the well-known cry of horse racetrack announcers, may not be coming to Georgia. In fact it’s more likely to be, “And IT’S off.”
Today Governor Deal stated that he is against an expansion of gambling in Georgia. Without pari-mutuel betting to raise the prize money for the races, there would likely not be a purse large enough to attract top-flight entrants to Georgia-based racing.
Despite a meeting today with members of the horse racing industry and some state lawmakers, Governor Deal is unlikely to endorse the necessary changes anytime soon. The Atlanta Journal-Constitution has the story:
Industry officials received a cool reception Thursday from Gov. Nathan Deal despite a continued push by backers to legalize gambling on horse racing in Georgia.
With lawmakers set to reconvene in January, former Breeders’ Cup board Chairman Bill Farish and Nick Nicholson, president and CEO of Kentucky’s Keeneland Association, made the visit to pitch the industry’s likely effects on Georgia’s job growth and economy. They met first with a handful of lawmakers before meeting privately with the governor.
Deal, however, told them “he wouldn’t support any effort to expand gambling in Georgia,” Deal spokesman Brian Robinson said.
His opposition is not likely to squelch the idea. State Rep. Harry Geisinger, R-Roswell, who arranged the meeting, has said the measure would bring in new revenue for popular programs — such as the state’s HOPE college scholarship program, pre-K classes and trauma care — without raising taxes.
I spoke with a source close to the study of bringing horse-racing to Georgia for some background information. This person brought forth some concerns that should be addressed, stressing that there are sufficient reasons for pause without considering moral issues.
First, the horse-racing industry does not do well without gambling in addition to pari-mutuel betting. Those venues that lack casinos-style gambling are desperate to bring it in. It seems that the draw may not be the horses, but rather the gambling itself. To get the participants to stick around and spend money, additional types of gambling may be required.
In Illinois, the racetracks are having a difficult time competing against Indiana’s “racinos” which each have 2,000 slot machines. The slot machine proceeds are used to fatten the purses offered which attract more and better race entrants.
The situation is serious enough that some believe Illinois-based horse racing is nearly finished. Former Illinois Governor Jim Edgar has a stable and is furiously lobbying the state to allow slot machines at racetracks in order to save the industry.
Second, the representatives of the horse-racing industry believe the only location in Georgia that could be successful would be the metro Atlanta area. There are valid concerns that adding “racinos” and casinos to the area would harm Atlanta’s attempts to attract international businesses to headquarter there.
This concern would go away if industry officials would consider a location in more rural areas of the state. The impact on Atlanta’s profile would vanish and one could argue that the impact of adding new jobs in rural areas would help offset the negative effect of the casinos that seem inevitable if horse racing is established. Industry officials are intent; however on an address near metro Atlanta because of fears that insufficient traffic would be generated for racetracks to be successful.
Third, there is the question of labor. Many of the promised jobs are the four A.M., low-wage, back-breaking labor that many Americans do not want. Mix in HB-87 and there may be problems, even from legal foreign residents. Kentucky’s consideration of a bill similar to HB-87 and the Arizona law, has resulted in some stables skipping races in Kentucky.
In addition, it is reported that federal immigration officials have targeted the horse racing industry to crack down on illegals.
According to my source, the horse racing industry has conducted no studies in more than five years and that there are no examples of successful locations which do not have additional gambling with the pari-mutuel betting. Most importantly, horse racing enthusiasts and industry representatives have not made the case that this move would benefit the state or the taxpayers.
The bottom line is that without casino-style gambling, horse racing in Georgia is extremely unlikely to work. Rep. Geisinger’s enthusiasm notwithstanding, successful horse racing in Georgia is unlikely to be a reality and is even more unlikely to become a positive revenue stream for the state.
::UPDATE The same Bill Farrish mentioned in the AJC story believes that the horse racing industry in Kentucky cannot survive without slot machines. In this published letter to The Paulick Report, Farrish states that Kentucky is “in danger of seeing major farms shutter their operations and move to friendlier jurisdictions” unless additional gambling is approved for their state. Read the full letter for more dire predictions from the former Chairman of the Breeders’ Cup.