NHBR Article

Racing ban vote another blow to N.H. dog tracks

Thursday, January 14, 2010

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The New Hampshire House voted Wednesday to ban dog racing, more than a year after a greyhound last raced in the state. So it won’t change a thing -- or will it?

At one time, such a vote would have been an arrow in the heart of the racing industry in New Hampshire, a feather in the cap of reformers either opposed to gambling or what they claimed was cruel treatment of the greyhounds. Now the tracks have other things on their mind, such as a gambling tax that has nearly cut their main revenue base – simulcasting – in half.

But that doesn’t mean they don’t care about Wednesday’s vote to send the bill banning dog racing (but leaving horse racing and simulcasting intact) to the House Ways and Means Committee.

First, there is the principle of the thing.

“We should have the option,” said Karen Keelan, president of Seabrook Greyhound Park. “This should be a business decision. They shouldn’t have taken our right to run our business away from us.”

It turns out that tracks charge twice as much for their simulcast signal to be sent to off-track betting parlors as to opposed to race tracks where live racing is held. And even though the Lodge at Belmont didn’t run a single race last year, it still is able to, and it just might arrange for a meet or two in the future – partly because it could bring out a nostalgic crowd in the heart of vacation season and partly to maintain the racetrack signal discount.

“This bill will have an adverse affect on our business,” said Rick Newman, a lobbyist for the Lodge.

Dog racing is a business that has seen better days.

Only two years ago, three of the four betting race tracks in the state featured greyhound racing, with only Rockingham Park in Salem racing horses.

And while dog racing had long ago become far less lucrative to tracks than betting on simulcast racing elsewhere, the state still required a certain amount of live racing (some 50 a year) in order to permit gambling on races broadcast from elsewhere.

Opponents not only objected to forcing dogs to race around the track they had an economic argument as well: It cost more money to regulate dog racing than it brought into the state.

Competition from other gambling venues – casinos, Internet gambling or “charity” poker -- had long cut into betting on live racing. One track, Hinsdale Greyhound Park was shuttered after its owner declared bankruptcy in December 2008.

Last year, the Legislature dropped the live racing requirement for simulcasting while still limiting simulcasting at existing tracks. But the state also required the tracks to pay for the cost of regulating them, starting in 2010 and lawmakers voted last year to impose a 10 percent tax on gambling winnings as part of a last-minute budget compromise.

The remaining two dog tracks -- Seabrook and The Lodge at Belmont – dropped dog racing, instead concentrating on simulcasting and charity casino games. (Rockingham Park ran live harness racing last year, but hasn’t decided as to what it will do this year)

Keelan said Seabrook dropped racing because it had to pay for the cost of regulation, but right now the bigger concern is the gambling tax, which she blames for a 40 percent drop in revenue.

“It has been very detrimental on our simulcast handle, as well as our poker revenue,” she said.

When asked how the track could stay in business with such a drastic revenue drop, she said “it is a struggle,” adding she hoped the Legislature, rather than banning live racing, would instead pass a bill repealing the gambling tax.

The income from the tax, she said, doesn’t make up for the revenue the state loses from the tracks.

Newman said that the Lodge’s revenue has fallen by 44 percent since the tax went into place and was hanging on to see if the Legislature changes its tune once it realizes that the tax actually costs the state money.

“The state gets a take of the handle already, and the tax generated hasn’t made up for the pari-mutuel loss,” said Newman. “It’s sad how much we lost. Within seconds of the passing of that tax, we had customers closing accounts,” Newman said. – BOB SANDERS/NEW HAMPSHIRE BUSINESS REVIEW

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