Archives for January 2011

With Pinnacle Entertainment’s $45 million acquisition of River Downs in November 2010, five of Ohio’s seven racetracks are now in the portfolios of casino companies, including all three of its Thoroughbred tracks.  Pinnacle Entertainment (PNK: NYSE) owns seven casinos and hotels in Indiana, Louisiana, Missouri, and Nevada.  Its Belterra Casino Resort & Spa is situated on the Indiana border with Kentucky about 60 miles southwest of Cincinnati and easily drivable from Lexington and Louisville.

Harrah’s Entertainment, the privately held global casino behemoth, agreed to acquire the bankrupt Magna Entertainment Corporation’s Thistledown near Cleveland for $89.5 million in September 2009, but exercised its option to back out when Ohio did not approve racetrack video lottery terminals.  The price was renegotiated to $43 million and the deal went through in May 2010.  Harrah’s also owns Louisiana Downs, Chester Racetrack (a harness track, near Philadelphia), and a half interest in Turfway Park in Florence, Kentucky just south of Cincinnati.

Penn National Gaming (PENN: NasdaqGS) is building two of Ohio’s four full-scale casinos—in Columbus and Toledo- that voters sanctioned in 2009.  Penn National Gaming, which already owned Raceway Park,   a harness facility in Toledo, bought the Columbus Thoroughbred racetrack Beulah Park in March 2010 for $37 million.  Penn National Gaming owns 15 casinos and seven racetracks, four of which are racinos.

MTR Gaming (MNTG: NasdaqGS), with Thoroughbred racetracks in Chester, West Virginia and Erie, Pennsylvania, is another publicly traded company with a racing position in Ohio.  Since 2002, it has operated the Standardbred track Scioto Downs in Columbus.

This flurry of racetrack purchases is predicated on the assumption that the Ohio Supreme Court will soon find video lottery terminals at the racetracks to be legally permissible under the existing authority of the Ohio Lottery Commission.  The newly installed governor, John Kasich, has said he is not opposed to gambling but wants to review the matter.  Like most states, Ohio has a deep budget deficit that taxes on slot machines could partially defray.

Ohio’s casinos will be up and running in the next few years in Cincinnati, Cleveland, Columbus, and Toledo.  All but one of Ohio’s racetracks are located in these cities or their suburbs.  If racetrack slots are approved and installed, as expected, the competition for customers in the four metro areas will be intense.   Whether the Buckeye State can and will support so many pari-mutuel and gaming options is an open question.  Penn National Gaming is reportedly considering the move of its two racetracks to other locations in Ohio to alleviate competition with its casinos.  Moreover, two entrepreneurs say they intend to build a racetrack for Thoroughbreds in the Youngstown area,

Business at three Thoroughbred racetracks not far from the Ohio border will almost certainly be cannibalized—Mountaineer Casino Racetrack & Resort, Presque Isle Downs, and Turfway Park.  The latter is in the most jeopardy because it will be less than a 30 minute drive from both the downtown Cincinnati casino and the River Downs racino on the Ohio River.  Unless Kentucky law is changed with alacrity to allow Turfway Park to offer slots, it is difficult to see how the track can weather a burgeoning competitive onslaught from casinos and racinos in Ohio and Indiana.

Copyright © 2011 Horse Racing Business

Originally published in the Blood-Horse.  Used with permission.

Sunday’s  National Football League AFC title game will feature the Pittsburgh Steelers against the New York Jets.  If the Steelers win they will appear in their eighth Super Bowl.  They have won six, the most of any team.  It all began with horse racing.

The Steelers founding owner, Art Rooney Sr., had strong connections to horse racing, as a gambler and owner of racetracks and bloodstock.  Mr. Rooney was the son of Irish immigrants from County Down, who settled in Coulterville, Pennsylvania, where he was born on January 27, 1901 (he died in 1988 at age 87).  He was raised on the North Side of Pittsburgh (Old Allegheny) and lived in an apartment over his father’s saloon.  He attended Duquesne University, spurning a scholarship offer to play football for Knute Rockne at the University of Notre Dame.  He played semipro baseball and semipro football.  This Irish Catholic kid could take care of himself–he was a welterweight and middleweight AAU boxing champion.

Mr. Rooney purchased the National Football League franchise for Pittsburgh during the Great Depression, in 1933, for $2,500 and named the team the Pittsburgh Pirates.  The capital came from Mr. Rooney’s winnings at Saratoga Race Track.  Then, in 1936, he parlayed a small sum (either $10 or $500, as the reports vary) into approximately $300,000 in two days at Saratoga and the old Empire City racetracks.  This money was used to get his team up and running by hiring coaches and players.  One of his early player acquisitions was Byron “Whizzer” White, who President John F. Kennedy appointed to the U. S. Supreme Court.  Justice White said that Mr. Rooney was “The finest man I’ve ever known.”

For forty years, until the early 1970s, the Steelers were doormats in the NFL.  With the hiring of Coach Chuck Noll and the acquisition of such players as Terry Bradshaw, Jack Lambert, Franco Harris, Joe Greene, Jack Ham, Lynn Swan, John Stallworth, and many others, the Steelers became the dominant team of the 1970s.  The foundation had been laid for the Steelers to become perennial contenders.

Mr. Rooney, called “the Chief,” was a horseplayer all his life.  He regularly attended the Kentucky Derby, where he could be seen with the trademark cigar in his mouth.  The Rooney Family over the years have owned and operated horse and dog racetracks in Florida, New York, Pennsylvania, and Vermont.  The Art Rooney Pace is a stakes race for 3-year-olds run at the family-owned Empire City at Yonkers Raceway.  Mr. Rooney owned a 350-acre Thoroughbred breeding farm in Maryland.  

Two other NFL founding owners, Charles Bidwell Sr. of the Chicago Cardinals and Tim Mara of the New York Giants, also had horse-racing ties.  Mr. Bidwell was a racetrack owner and Mr. Mara was a legal bookie.

Mr. Rooney’s concern for his players was best illustrated by Rocky Bleier, who came to the Steelers from Notre Dame.  Mr. Bleier was drafted into the U. S. Army after finishing his rookie season with the Steelers in 1968.  He volunteered for duty in Vietnam.  In August of 1969, he was wounded in his left thigh when his platoon was ambushed in a rice paddy.  He went down and was wounded a second time in his right lower leg by shrapnel from a grenade.  The medical prognosis was that his football playing days were over.  While Mr. Bleier was recovering, he received a postcard:  “Rock, the team’s not doing well.  We need you.  Art Rooney.”  Mr. Bleier was a starter on the Steelers throughout their glory years in the 1970s.

Art Rooney was a beloved figure, a humanitarian, and one of the greatest sportsmen of all time.  The seed money for this remarkable life came from some savvy handicapping by a young man from western Pennsylvania.  The sport of horse racing can be proud to have claimed “the Chief” as one of its own. 

(Ironically, given the Steelers origins, the Rooney family in 2008 was forced by the NFL to sell part of the team, while retaining control, in order to comply with League rules pertaining to  owners being involved with gambling business interests like racetracks and racinos.)

Copyright © 2011 Horse Racing Business

Horse Racing Business offers congratulations to Ann and Jerry Moss and their Horse of the Year Zenyatta, as well as to all of the Eclipse Award winners.  This gallant and durable mare will be remembered as one of racing’s all-time greats.