International edition
June 25, 2021

Local governor signed a budget bill legalizing up to 17,500 slots

Harrah's among the big players drawn by Ohio's expansion of legalized betting

(US).- Harrah's Entertainment is considering Ohio as its next target now that state leaders have embraced expanded gambling. The company is circulating an e-mail survey among its Ohio-based customers asking for their thoughts on the state's horse racing tracks, including Thistledown in North Randall and Northfield Park in Summit County.

L

ast month, Governor Ted Strickland signed a budget bill legalizing up to 17,500 slot machines at Ohio's seven race tracks.

Harrah's e-mail said it is "considering developing a casino in the Cleveland area, but we need your help to decide where!" The survey asks how often the customers visit Northfield and Thistledown, whether they feel safe there, and whether they prefer $1, 25-cent or penny slot machines.

"It's part of the normal due diligence procedures we use when a market either legalizes or expands its gaming," said Harrah's spokesman Gary Thompson. "It doesn't mean we have any current interests or intent to enter that market," he said. "We just want to keep our finger on the pulse whenever a market does expand."

And Ohio is poised for a gambling explosion. In addition to the plan for slots at racetracks, a constitutional amendment approved for the November ballot could bring four, full-service casinos to Ohio. "The big guys are going to come in as soon as the slots are up and running," said Maryland-based gambling industry expert Jeff Hooke.

"And then after a couple years they'll see how much money is coming in and they'll conspire with certain legislators and say 'now we need table games to bring even more revenue in,' " he said. "The citizens of Ohio can look for that argument in about two years."
It happened in Pennsylvania, West Virginia and Indiana, which all started with slot machine gambling but have since expanded into table games for a full casino effect.

David Zanotti, an anti-gambling activist from the Ohio Roundtable, long predicted it would happen in Ohio, too. "There are still a lot of non-defined areas in the governor's actions legalizing these things," he said. "The tracks are privately owned so they could all be bought up tomorrow by these Vegas companies, or they'll be asking right away for table games. "Everything is in play right now," Zanotti said. "It's the Wild West."

Northfield Park owner Brock Milstein said many companies have contacted his track looking to partner with it now that slot machine betting is coming. "I can't say I am eager to talk about partnering with some other company," he said, "but if the opportunity presented itself, I can't say I wouldn't want to talk."

Charlie Ruma, who runs Beulah Park near Columbus, said he has been contacted, too. And he's listening. "All I want to do is find the right people to manage a facility so that I can be competitive and operate successfully," he said.

The deep-pocketed gambling companies could help the race tracks with up-front expenses, such as the us$ 65 million licensing fee, and with renovations to transform the old tracks into attractive new gambling venues.

Both Milstein and Ruma said they will pay the license fee once the Ohio Lottery, which will oversee the games, comes up with details and procedures. That process has not gone smoothly. Also, a conservative group has gone to the Ohio Supreme Court to challenge whether the governor and legislature have authority legalize the slot machines without a vote of the people.

Once those hurdles are cleared - if they are cleared - the jockeying from gambling companies probably will grow more intense, said Hooke, the industry expert, noting that the gambling companies won't want any part of legal troubles. Ruma and Milstein said six of the seven track owners have assured Strickland that they will pay the fee and add slots.

That is important to the governor because he balanced the current two-year budget on the hope of drawing us$ 933 million from the tracks in slots fees and revenue. Critics have said that figure is far too optimistic and will have to be revised within a year. The only track that has not committed is Raceway Park in Toledo, owned by Penn National Gaming.

Penn and Cleveland Cavaliers majority owner Dan Gilbert are the forces behind the competing casino amendment on the Nov. 3 ballot. If voters approve the measure, Penn and Gilbert would have constitutional rights to build casinos in Cleveland, Columbus, Cincinnati and Toledo whenever they want.

Track owners, meanwhile, call the casino proposal a bad deal for Ohio. Ruma notes the proposal is being pushed by entities with roots in other states - Penn in Pennsylvania and Gilbert in Michigan - and has a tax rate too low to benefit Ohio.

Still, Ruma did not rule out partnering with Penn. After all, business is business. “Absolutely, they are good people," said Ruma, adding that reports that Penn has an option to buy his track are false.

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