Slots at the track? Let Voters Decide

Written by Assemblyman Ralph Caputo

Assemblyman Ralph Caputo (D-Essex) is a member of the recently-completed Legislative Gaming Summit and also the Assembly's Regulatory Oversight and Gaming Committee.

Imagine if the New York Giants were allowed to singlehandedly dictate the fate of the New York Yankees, including when or even if they win. Pretty preposterous, right?

Needless to say there would be a few irate Bombers fans.

Yet in New Jersey, we have a similar scenario unfolding within a different industry. Gaming titan Harrah's Entertainment is leading the charge by the casino industry to block efforts to revitalize New Jersey's horse racing industry. This charge was further backed by the "Hanson Report" commissioned by Governor Christie to examine the future of New Jersey's gaming, entertainment and sports industry.

Most experts believe that the only way to rescue our declining racetracks is to increase gaming options to create a more enticing experience, chief among these proposals being the installation of video lottery terminals (VLTs) or slot machines. VLTs would boost purses at the racetracks and thereby relieve the casino industry of the $30 million annual horse racing subsidy they currently provide.

The Meadowlands Racetrack is dying a slow death because of competition at Yonkers Raceway, a mere 20 miles away, while a new racino at the Aqueduct in Queens is about to break ground.

Resorts was sold at a fire sale price; the Hilton is under receivership; Donald Trump wants to sell all three of his Atlantic City properties; the land in front of the old Sands casino is for sale at roughly 70 percent of what it is worth; and the planned Revel casino is struggling for financing after Morgan Stanley pulled out its investment.

Meanwhile Harrah's has been part of a vocal bloc of casinos opposed to creating anymore gaming competition in New Jersey. But herein lies the rub.

It was recently announced that Harrah's Entertainment is attempting to become a partner and take on a management role in the development of a $438 million gaming hall in Philadelphia with 1,500 slots, more than 70 table games, and several restaurants.

What does this mean? Harrah's is a hypocrite, plain and simple.

The Meadowlands is roughly 130 miles from Atlantic City and Philadelphia is a mere 60 miles away. It's also important to note that Harrah's casino and racetrack in Chester, Pennsylvania, a little over 70 miles from Atlantic City, is flourishing since it opened four years ago.

I guess Harrah's is fine investing in a competing market if they get a piece of the pie. If this is the case, why won't Harrah's invest in the Meadowlands or Monmouth Park as well?

If we don't act soon, the equine industry in New Jersey, and all its ancillary benefits will vanish. According to a 2007 report released by Rutgers, the industry has an economic impact of $1.1 billion annually, including 13,000 jobs and $130 million in federal, state and local taxes.

Without racing, our horse farms will systematically disappear, leaving roughly 176,000 acres of open space vulnerable to development and sprawl.

But if we can summon the courage to stave off attempts by a few industry titans to maintain a monopoly on gaming in New Jersey, the benefits we stand to reap are endless.

Just last week it was reported that in the four years since it opened, the Empire City Casino at Yonkers Raceway has already generated $1 billion to help fund education in New York State. Furthermore the city of Yonkers receives an estimated $20 million annually that gets invested directly into the classroom.

Considering Governor Christie cut nearly $1 billion in aid to New Jersey schools this year; Xanadu is on life support; and the Nets have fled the Izod Center, a racino is just what the Meadowlands needs to breathe new life into North Jersey and our overall economy.

The Meadowlands Regional Chamber of Commerce recently reached out to me claiming proposals would come in from all over the world if the state were to pursue building a casino/hotel/convention center facility to support the existing racetrack.

Not only are these options worth pursuing, they are a necessity. Ultimately, I believe Atlantic City casinos should be allowed to invest in VLT's at our racetracks for the benefit of the industry and our taxpayers as a whole.

At the moment, I have several bills pending in the legislature (A-2458 and A-2550) that would authorize the installation of video lottery terminals at the Meadowlands and put the proposal on the ballot for voter approval. I have also sponsored another measure that would allow sports wagering at casinos and racetracks.

A Senate committee recently approved several other bills to allow parimutuel wagering so that racetracks can combine wagers to insulate themselves from large payouts, as well as exchange wagering which would allow two or more bettors to place directly opposing wagers on the outcome of a horse race. While these measures can certainly play a part in the big solution, they will do little to help us compete with the diversity of neighboring racinos.

The task at hand now is to develop a cohesive strategy that melds the objectives of the Legislative Gaming Summit, the Legislature's standing committees on gaming, the Hanson Report, and the Governor to boost the overall gaming industry in our state.

Time is running out, and we need to find ways to increase our revenue now. It's time we began to think — and act — outside the box. Rather than let one giant control our gaming industry, this decision should be put to the voters.

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