Horse racing insiders say toughest year ahead for state tracks
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For Mike Campbell, the warm Arkansas night was filled with both hope and sadness.
The Lake Zurich resident and president of the Illinois Thoroughbred Horsemen's Association was at a jockeys benefit for the Arkansas Children's Hospital in early April, where he trains horses during the winter.
The state of horse racing
• 1990: $358.3 million bet on live thoroughbred horse races at Illinois horse racing tracks
• 2010: $107.8 million, a drop of nearly 70 percent
Wagers at Arlington Park
• Down $26.4 million since 2000, to $39.2 million last year
Prizes for horse owners
• At Arlington Park, purses dropped by about 32 percent in last decade, from about $31 million to about $21 million per season.
• Down by 26 percent statewide since 1990
Arlington Park track attendance
• Down 11.3 percent in last decade
1990: No casinos in Illinois
Today: 10 (with summer opening in Des Plaines)
Sources: Illinois Racing Board figures, Daily Herald research
The rented hall was filled with young jockeys, just beginning their careers in the industry, he said.
"When I looked across the room, I couldn't help but admire the youth, the personalities and the sophistication of the group," said Campbell, whose 32-year-old twin sons, Joel and Jesse, are jockeys.
Campbell said he made a promise to himself that night. "I'm going to do everything I can to make these kids have a future," he said.
But with fewer people attending races at tracks like Arlington Park, and betting less when they do go, the future of the sport in Illinois remains an open question. Lawmakers for years have been fighting over ways to help the struggling horse racing industry, but few solutions have become reality.
Twenty years ago, in 1990, Illinoisans bet $358.3 million on live thoroughbred horse races at the state's tracks, according to Illinois Racing Board figures. In 2010, they bet $107.8 million, a decline of nearly 70 percent.
Richard Duchossois, who has owned at least part of Arlington Park since 1983, said this isn't the first time the horse racing industry has faced economic storms.
"Back in the late '70s, horse racing in Illinois was in a situation very similar," he said. "We said something had to be done. Developed the first million-dollar race in the world. Then we started moving up."
Arlington arrived at another crossroads in 1985, when a fire devastated the original grandstand facility.
"All the world said racing in Illinois was through. But 23 days after the fire, we had the Arlington Million and it got labeled as the 'Miracle Million,'" said Duchossois, chairman of The Duchossois Group, which has an ownership stake in Arlington Park.
But in the last 20 years, the purses paid out to thoroughbred winners in Illinois dropped by nearly 26 percent, leaving some owners to wonder if the expenses they incur to breed, train and race horses is worthwhile as the prize money keeps decreasing.
The competitive environment was much different in 1990, when Illinois had no casinos competing with its tracks.
Gambling competition has only increased through the years via Illinois casinos and the state's lottery. Now the state's 10th casino is set to open in Des Plaines this summer and the potential remains for video gambling machines at local bars and clubs. And suburban residents hit hard by the recession are likely cutting back on their gambling anyway, factors all making it tougher for horse tracks like the one in Arlington Heights.
It's a decline that's putting pressure on local opponents to allowing 1,000-plus slot machines in a separate building on the Arlington Park grounds, in hopes of drawing gamblers year-round, not just during the horse racing season.
This month, Frank Calabrese, perhaps Arlington Park's most prominent horse owner, decided not to run his horses there this season. He's instead running them in Florida, where the purses are more lucrative.
Arlington Heights Mayor Arlene Mulder recently said she feared Arlington Park would close and that she'd support the track's bid to get lawmakers in Springfield to greenlight the installation of slot machines there. It's an issue that's sparked debate in Arlington Heights for years, every time it has been proposed at the state level, in part because those proposals wouldn't give local trustees a say on the issue.
"I hope that they allow the racetrack to create an additional revenue stream that could help them compete with neighboring states, primarily Indiana," the 18-year mayor said after her annual "state of the village" address this month.
But gambling opponents last week were loudly arguing that slot machines might not even save the tracks. Two companies that own Indiana tracks with slot machines have both filed for bankruptcy protection.
Still, Arlington Park officials are preparing for another racing season starting early next month. In the last 10 years, the track has seen its attendance drop 11.3 percent. The purses the track awards have dropped about 32 percent in the decade, from about $31 million to about $21 million per season.
Total annual betting on live races at Arlington Park has declined by $26.4 million in the last decade, a drop of 40 percent. Remote betting on Arlington Park races from across the country also is down.
Arlington Park general manager Tony Petrillo says he's working hard to find other ways to generate interest in racing and generate cash at the track.
"May through the middle of August is filled with at least one big event each week that we can draw the attraction of people so we can introduce them to horse racing," Petrillo said.
This year, Petrillo said, the track has formed new partnerships with Northwestern University, the Chicago Bears and others to bring crowds in and supplement racing revenues.
"We're doing things, focusing on entertainment to draw in new customers and younger customers," Petrillo said. "We need to support racing in other ways."
The declining purses, though, put the pinch on people in the industry trying to make money off gamblers who pay to play the ponies.
Campbell said he's gone from training about 40 horses a season in 2007 to just 10 today.
"And the thing that bothers me the most, is the desperation that I feel from other people. The hopelessness that my membership is experiencing," he said.
That feeling isn't confined to Illinois' horse racing industry.
"Illinois is hardly unique," said Bennett Liebman, an industry expert from Albany Law School in New York. "This has happened, realistically, in every state that's had a mature horse-racing industry."
Liebman, a horse racing fan himself, says people are just losing interest in the sport. The states that have installed slot machines do generate more cash for the industry, but don't necessarily draw more fans to the sport of racing.
"To many people, it looks like you're rewarding an industry for failing," Liebman said.
That's just the argument that John Kindt, a University of Illinois professor of business and legal policy, makes against allowing slot machines at racetracks.
After all, he says, failing car dealerships and grocery stores aren't given slot machines to save their businesses. "Slot machines are a bailout for the horse racing industry," Kindt said.
While slot machines are the tracks' big push now, the industry has been trying to get a cut of the casinos' action for a while. In 1999, lawmakers approved a law that would divert 15 percent of the revenues from the state's 10th casino to the horse racing industry.
That casino hasn't opened yet. It's scheduled to welcome its first customers in Des Plaines this summer.
And in 2006, lawmakers tried to divert 3 percent of the revenues from the state's most lucrative casinos — the ones in the Chicago suburbs — to horse racing. That legislation has been tied up in court since.
"It's five years later and not one penny has gone to horse racing," said Bob Molaro, an industry lobbyist and former state lawmaker who worked extensively on racing issues.
This year, the fight is on once again to expand gambling in Illinois, including giving Arlington Park up to 1,200 slot machines.
Sen. Terry Link, a Waukegan Democrat, has begun moving legislation intended to do just that, but details aren't yet available. He argues the state could use the financial help created by taxes from new slot machines and casinos.
And in the House, Rep. Lou Lang, a Skokie Democrat, has been working on a plan to give slots to the tracks, without any new casinos.
It might be hard for Lang to find support for his plan, though. Gambling expansion plans in Illinois often must grow to get support of lawmakers of varying interests. A lawmaker who really wants a casino in his district, for example, is unlikely to vote for an expansion plan that doesn't include new casinos. Likewise, a casino-expansion plan would likely go nowhere without help for the horse racing industry.
Then, expansion supporters often hit a wall. Those gambling plans grow so large that lawmakers hesitant to expand gambling at all pull their support.
So as lawmakers continue to grapple in Springfield, suburban horse owners have to evaluate their own plans.
Rob Marcocchio of Rolling Meadows has raced horses at Arlington for nearly four decades, ever since he arrived from Canada in 1974.
This year very well could be the exception.
"I'm not sure if I'm going to have any there now under the circumstances," Marcocchio said in an interview from Toronto, where he had horses racing at Woodbine Racetrack earlier this month.
"It's a possibility that I will return. I live there," he said. "I love the facility itself. But going forward I just don't know what the future of racing in Illinois is going to be."
Many outside the horse racing industry were shocked when Calabrese announced that he would not be bringing his horses back to the track this summer.
Marcocchio says he wasn't.
"The way he analyzes it and the things he said are very valid," Marcocchio said.
Their situations are slightly different. While Calabrese is the sole owner of a large number of horses, Marcocchio is involved in partnerships, owning several horses with ABC 7 News anchor Ron Magers.
"Magers and I have decisions to make on what's the best avenue," Marcocchio said.
"When you tell them if you race at Arlington you'll have less chance to run your horses and less chance to break even, it's not practical," Marcocchio said.
He said he greatly respects Arlington owner Duchossois and "his love and his passion for the game."
Yet, he wrote an impassioned letter to Duchossois in February, explaining that they couldn't run a "good filly" at Arlington because the field isn't strong enough.
He says the racing industry in Illinois is at a crossroads. "In the next 12 months, if legislation allowing slots at racetracks doesn't pass, I think the end of racing as we know it is going to end in Illinois."
Whether Arlington or Hawthorne Race Course in Cicero survive, Marcocchio said, "the quality of racing and life as we know it is going to end. There isn't enough cohesiveness to try and make it work."
Critics of efforts to help the industry say that's the nature of business — not every enterprise can be successful forever.
But Chris Block, a Deer Park horse trainer who has been running horses at Arlington Park for 20 years, says the industry at least deserves a fair shot to compete with tracks in other states, such as neighboring Indiana, that do have slot machines.
The industry deserves that kind of level playing field, Block says, if only because so many Illinois jobs depend on it — from the workers at Arlington Park to the downstate farmers who raise the horses.
"This is my livelihood," Block says. "This is it."
And for the man whose life has been Arlington Park, Duchossois says it's impossible to say if the track will stay open.
"That's a hard thing to say," Duchossois said, noting that as a part-owner, he is not the sole decision maker.
"We are going to do everything we possibly can," he said. "We have always been optimistic. We think the innovation (will help). We're going to keep trying. We have to keep trying. We're going to do everything we possibly can to make this a prosperous place."
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