PRESQUE ISLE DOWNS & CASINO

Once or twice a year, I drive about two hours from my home in Ohio to attend the races at Presque Isle Downs & Casino in Erie Pennsylvania.

Erie, Pennsylvania is an old industrial town on the south shore of Lake Erie, about 93 miles southwest of Buffalo, New York, 103 miles northeast of Cleveland, Ohio, and 38 miles due west of the venerable Chautauqua Institution in New York. It is the fourth largest city in Pennsylvania with a population of nearly 104,000. The General Electric plant in Erie is “one of the largest manufacturers of equipment for the railroad industries, including locomotives.”

Avid racing fans will immediately recognize the name of Erie’s most famous handicapper, Andrew Beyer, who grew up in “dreary Erie,” so called because of the lake effect that often causes overcast days.

Erie was once the home of Commodore Downs, a Thoroughbred racetrack that opened in 1973 and offered daily purses of just under $14,000. Commodore Downs folded but reopened as Erie Downs, which also went out of business, in 1987… and was replaced by an industrial park.

In 2004, Pennsylvania legalized slot machines at authorized facilities, including at MTR Gaming Group’s proposed Presque Isle Downs & Casino, named after a nearby beautiful recreational and wildlife area. MTR Gaming Group also owns and operates Mountaineer Casino Racetrack Resort in Chester, West Virginia and Scioto Downs in Columbus, Ohio.

Presque Isle Downs & Casino was built from the ground up and opened on February 27, 2007 with slot machines. A one-month race meet was held in September 2007.

Presque Isle Downs & Casino is directly off Interstate 90 going east toward Buffalo. The race meet currently runs Tuesday through Sunday beginning in early May and ending in late September. Races begin at 5:30 PM and end at 8:30PM. The racing surface is a Tapeta™ synthetic installed by former trainer Michael Dickinson.

Pennsylvania legalized table games in 2010 and they are now up and running at Presque Isle Downs & Casino. In addition to the racetrack, Presque Isle Downs & Casino presently “features a 140,000 square foot clubhouse with 2,000 slot machines, 48 gaming tables, and fine and casual restaurants and lounges.” The racetrack is adjacent to the clubhouse and has a wooded area as a backdrop.

In the first half of the 2010 season, the average number of horses per race was 7.5. This number will increase with the addition of additional stabling. Currently, the track has 500 stalls, but two barns will be built this year and in each of the next three years, thereby expanding the stalls to 1,000.

Presque Isle Downs & Casino substituted Tuesday racing in 2010 for the more popular Sunday cards, and nightly average attendance dropped from 828 in 2009 to 588. On-site handle averaged $32,735 and off-track handle was $374,294. The racetrack is disadvantaged in that it does not operate its own ADW and it has no OTBs. Presque Isle Downs derives 13.5% of its revenues from pari-mutuel wagering and 86.5% from other product lines, principally alternative gaming.

Average daily purses are $177,982 (through August). A bottom-level $5,000 claiming race has a purse of $13,000-$14,000–and possibly more from the Pennsylvania Breeding Fund. These payouts have been a magnet for well-known stables and trainers, especially from racing states that do not permit alternative gaming. The racetrack’s most lucrative race is the $400,000 Grade III The Presque Isle Downs Masters Stake for fillies and mares 3-years-old and up at 6 ½ furlongs. It will be run tonight (September 11). 

Presque Isle Downs & Casino serves up an inviting laid-back environment. The view here is that it is one of the better racetracks in terms of the overall customer experience  and is worthy of emulation. The paddock is easily accessible to fans, the frontline employees are friendly and helpful, the facility is kept very clean, and there is a variety of good food and drink available, ranging from concession stands to buffets to an upscale steakhouse. In addition, the track’s announcer (Ron Mullis) and on-air simulcast duo (Mullis and Katie Mikolay) are informative and personable. 

Without alternative gaming, the existing purse levels would not be remotely possible. However, a reputable study showed that between the time when racinos were legalized in Pennsylvania in 2004 through 2009, the Pennsylvania equine industry soared from $1.5 billion to $3.0 billion annually and is still growing at a rapid rate. Thoroughbred owners from as far away as California are buying farms in the Keystone State and others are taking part in the state-bred program.

Copyright © 2010 Horse Racing Business

Comments

  1. Professor Shanklin wrote:

    Presque Isle Downs derives 13.5% of its revenues from pari-mutuel wagering and 86.5% from other product lines, principally alternative gaming.

    ______________________

    After starting out with a strong purse structure in Presque Isle’s inaugural meet and the lofty expectations, the novelty has clearly worn off the racing end.

    Not coincidentally this is yet another Pennyslvania racetrack with a ridiculously high takeout structure.

    Trifectas & Pick 3 26%
    Superfectas 29%

    U.S. horseplayers are not going to embrace this racetrack at those usurious rates, especially with racing being conducted on a synthetic surface.

    In short, the casino end is not promoting the future of the live horse racing product in Pennsylvania.

  2. After starting out with a strong purse structure in Presque Isle’s inaugural meet and the lofty expectations, the novelty has clearly worn off the racing end.

  3. Pennsylvania has one of the best thoroughbred racing programs and breeder incentives in the entire country. Ten per cent of slot revenue is reserved by the State of Pa. to fund racing purses. With gambling being approved in Ohio the expectations of a saturated gambling market
    will lower the potential purses in Pennsylvania is misfounded. The Ohio gambling law sets aside 3% of slot revenue giving Pennsylvania a major advantage over Ohio. The purses will be much larger in Pennsylvania thus attracting more horses and horses of better quality. The fear that full gaming revenue, which the horse industry does not participate, will lower the slot revenue, so far, has been unfounded as slot revenue has increased at most venues.

    The State of Pa. has derived more revenue from taxing of the gaming industry than LAS VEGAS, NEVADA. giving the State of Pennsylvania the incentive to invest in developing and re-developing its major attractions, in Erie, Pa.
    $42 million was approved for re-developing the Tullio Arena and $11 million was approved for improving the Warner Theatre. Erie has millions of visitors to its beaches each year, also is within 500 miles of 50% of the population of the United States, not including its proximity to Canada, it also has over 5,500 hotel rooms and a list of major attractions including Splash Lagoon
    an indoor water attraction, Family Sports Park featuring indoor soccer and a family theme park,
    Waldemeer Park is a major family theme park, close proximity to PeeknPeak Golf and Ski Resort and the Findley Lake and Chautauque Institute and Lake area help make this area a prime location to attract millions of visitors.
    The gambling demographics within 500 miles of Erie, Pa. are some of the best in the nation.
    The advantage of the Pennsylvania Racing Program over the surrounding States to attract gamblers from places like New York and Ohio
    should not be overlooked by the Casino because it is the EDGE needed to attract more gambler to Pennsylvania. More concentration should be given to incorporating a more successful racetrack into the fabric of the Casino, more gamblers translate into more money for everyone. The State of Pennsylvania needs to invest more into attracting more people otherwise they will tax this industry to death.
    Nearly 60% of slot revenue borders on usery.

    Horses are here to stay in Pennsylvania it would be best to treat them as an asset, since they are part of the game anyway, and not create a liability for the entire industry…..use the horses to attract more gamblers to Pennsylvania, your supposed to be an industry that knows an EDGE when they see one?

  4. the days of the week for racing are incorrect. The horses do not race Thursday thru sunday… I believe the correct days this year are Monday thru Thursday

  5. days of racing at presque isle downs are Sunday Thru Thursday, starting at 5:30pm.

  6. Bill Shanklin says

    To P. Smith,

    The days of racing were correct when the article was published in 2010. The track changed the days since then. Thanks for pointing this out.

Speak Your Mind

*