Monmouth Park Privatization Deal Unraveling

Monmouth Park is in jeopardy of closing  due to a dispute over the licensing of thoroughbred races at the Meadowlands, according to a report in The Star Ledger.

The New Jersey Thoroughbred Horsemen’s Associated successfully negotiated for the rights to the Meadowlands races on June 21.   Now the investor slated to take over the Meadowlands track, Jeffrey Gural, wants the rights back because he didn’t realize he was giving up proceeds of off-track wagering on the races.  Evidently, the Christie administration is siding with Gural and is refusing to issue the license to the horsemen.

The Meadowlands license impacts Monmouth Park because races licensed for the Meadowlands are frequently transferred to Monmouth.

As a result of the dispute, Morris Baily, the investor slated to take over Monmouth Park from the state, says he wants out of the deal, according to the Ledger.

The parties would have a lot more money to fight over, while keeping the tracks open, if  slots were permitted at the racetracks, as they are in a growing number of tracks throughout the region.

Assemblyman Ronald Dancer has introduced two pieces of legislation that would permit slots at racetracks.

A-4294 directs the Division of Gaming Enforcement (DGE), in consultation with the New Jersey Racing Commission, to implement and oversee slot machine gambling operations at horse racing venues.

ACR-209 is a resolution proposing a constitutional amendment that gives the Legislature the authority to establish slot machine gambling at racetracks. If approved by voters, the specific restrictions and control of operations of slot machines, as well as the use of the State’s share of revenues derived from the machines, would be provided by law.

“Both proposals represent an incentive for the major stakeholders in this issue – the casino and horse racing industries – to come together and work out a fair and mutually beneficial agreement. Allowing slot machines at racetracks will generate revenues that will help both industries,” said Dancer. “One industry’s success does not have to be at the expense of the other. Permitting slot machines at racing venues will preserve and enhance both.

“One unique aspect of these bills is that the DGE will consult with the Racing Commission in overseeing the operation of slot machines, without the involvement of the New Jersey Lottery Commission which exists currently,” explained Dancer. “As a result, the proceeds from expanding slots at the racetracks would not be diluted to another commission, but distributed to the industries for which they are intended.

I am open to either approach in deciding this issue. We can allow the voters to determine if amending New Jersey’s Constitution is appropriate or work through the legislative process,” commented Dancer. “The casino and horse racing industries are important parts of our state’s economy. I am confident we can reach a reasonable solution as to how we can capitalize on the market potential slot machines at racetracks will produce.”

Dancer pointed out the benefits New Jersey’s horse racing industry provides to the state, including jobs, tax revenue and preserving open space. According to the Rutgers Equine Center, horse racing employs over 7,000 workers and contributes nearly $800 million to the state’s economy. Further, 34,000 acres of the state’s 176,000 farmland acres are attributable to the horse racing industry.

Unfortunately, Dancer’s legislation has little chance of becoming law, as Governor Chris Christie and Senate President Steve Sweeney are opposed to allowing slots in New Jersey anywhere outside of Atlantic City.

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$500 Million In State Revenues Projected From New Racino

New York State, that is.

A new “racino” with only electronic gambling is set to open next month at Aqueduct Racetrack in Jamaica, NY.  The facility is expected to generate $10 billion in annual betting, $500 million in annual revenue to the State of New York, and 1300 jobs.  The $10 billion bet at Aqueduct will top the $7 billion annual handle at the Empire City Casino at Yonkers Raceway.

So says today’s New York Post.

The Meadowlands Racetrack is closer to Mid-town Manhattan than Jamaica or Yonkers.

Would someone tell me again why New Jersey is leaving all of that money “on the table?”

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Governor Chris Christie Announces Solution to Keep Standardbred Racing at the Medowlands

Trenton, NJ – Governor Chris Christie today announced a break-through agreement to keep live Standardbred racing at the Meadowlands beginning in January via a secured short-term financing plan to bridge the gap to a potential long-term solution that will make the Meadowlands racetrack a privately run, self-sustaining venture without taxpayer subsidies.

The agreement meets the Governor’s foremost requirement that operating and purse subsidies for Standardbred racing come to an end.   To ensure that racing at the Meadowlands can continue uninterrupted on its January schedule, the New Jersey Sports and Exposition Authority (NJSEA) will extend operations, secured by simulcast racing revenues, through only March 31, with no costs being absorbed by state taxpayers.

In the meantime, the Standardbred Breeders and Owners Association (SBOA) or its designee will be guaranteed exclusive rights to negotiate a $1 per-year lease for the Meadowlands racetrack for up to five years, with a renewal option.  If, at the end of March a lease agreement and self-sustaining operating plan is not in place, all parties agree that the NJSEA will suspend standardbred racing at the Meadowlands Racetrack, with the possible exception of the Hambletonian Meet in August 2011.

“It has been my goal all along to keep horse racing alive in New Jersey and at the Meadowlands with a renewed, financially-sound business model that meets the fiscal realities faced today by both the horse racing industry and the state,” Governor Christie said.  “Given the economic realities, my first interest and priority lies with taxpayers of New Jersey and ensuring the future of the sport is no longer reliant on millions of dollars in subsidies year after year.  Today, we have reached a mutually beneficial agreement for the near term, and a framework for a long-term solution to move the industry forward on an independent and self-sustaining financial foundation.”

“I am excited to find a way to operate the Meadowlands and several off-track wagering facilities in the private sector,” said Jeff Gural, a New York racetrack owner-operator and real estate developer.  “I think the structure that is being proposed will be well received by our customers, as we intend to produce the highest quality horse racing product in the standardbred industry.  I’ve been successful in Upstate New York at Tioga Downs, where we have been able to attract new and younger customers. We will use the same marketing strategies for the Meadowlands and hope for the same results.”

“We are thankful real estate entrepreneur and harness racing enthusiast Jeff Gural came to our aid during the final stretch of discussions with the Christie Administration,” Tom Luchento, president of the SBOA, said.  “The deal with the Governor to save Standardbred racing at Meadowlands will provide our industry a lifeline and give us time to implement innovative changes that will foster self-suffiency.  The time is now for the State of New Jersey and Meadowlands Racetrack to regain their status as the world’s premiere standardbred racing venue.”

All parties involved have agreed that the state will no longer subsidize harness racing at the Meadowlands.  If a long-term lease agreement and operating plan for self-sufficiency is not reached by March 31, 2011, all parties agree that a good faith effort will have been made by the standardbred industry and the Christie Administration to reach an agreement and avoid closure of the Meadowlands Racetrack.

The state’s short-term funding for the first quarter of 2011 operations will be guaranteed by the SBOA’s pledge of its right to simulcasting revenue at the Meadowlands from April 1, 2011, until the state recoups its costs.

Among the lease parameters agreed to today:

• The NJSEA will assign up to four off-track-wagering (OTW) locations, including Bayonne (but not Woodbridge), all of which would operate contingent on private operation of the Meadowlands Racetrack.

• The OTW locations would pay the NJSEA 10 percent of net OTW earnings.

• There will be no ongoing subsidies for purses or racing operations.

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Christie To Make Announcement Regarding Standardbred racing at the Meadowlands

By Art Gallagher

Governor Christie’s office has called a press conference for 3PM to announce a “significant development concerning Standardbred racing at the Meadowlands”

Bob Jordan at Capital Quickies is reporting that a deal has been made with Jeffrey Gural, the owner of two New York horse tracks, to lease the Meadowlands Racetrack.

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