Wagering on horses has slowed considerably over 15 years

By ROBERT CONNELLY

rconnelly@vindy.com

AUSTINTOWN

Sam Corona was staying at Fort Meade in Maryland after being drafted in 1943 during World War II.

For that night, the soldiers could board one of two USO buses for entertainment — either head to the dance or head to a racetrack.

Corona said he was a bad dancer, so he hopped on the latter.

He’s been betting horses ever since.

Corona, 90, of Austintown, and four to five friends frequent the off-track betting site in New Castle, Pa., that is for The Meadows Racetrack & Casino, based in Washington, Pa. The Meadows is owned by Cannery Casino Resorts, based in Las Vegas, and features harness horse racing in which jockeys ride in a cart that is attached to the horse’s saddle.

Horse racing is coming to Corona’s hometown of Austintown, with the new Hollywood Gaming at Mahoning Valley Race Course near Interstate 80-state Route 46

interchange. The casino opens Sept. 17 with 850 video-lottery terminals. Thoroughbred racing will start Nov. 24.

As Corona and his betting peers have aged, some having died, Corona questions from where the bettors will come when the track opens.

“It’s a dying proposition because the racing is dying. But the horse bettors — they’re gone and [there’s] nobody to replace them,” Corona said.

He worked in the railroad industry from 1946 to his retirement in 1986 and laughed about his first job after the war as a bookie on West Federal Street in Youngstown.

The 24,500-square-foot OTB in New Castle opened in 1990.

“When I first started going to The Meadows in New Castle, you couldn’t get a seat. They only [had] two tracks in Pennsylvania [then] ... They got them all over the country now. You couldn’t get a seat. Now, if you go there Monday or Tuesday, I don’t think you’ll see 20 or 25 people in the whole area,” Corona said.

Representatives of The Meadows, which closed an OTB last year in Moon Township, northwest of Pittsburgh, declined to comment for this story.

According to the Pennsylvania Gaming Control Board’s 2013 Racetrack Casino Benchmark Report, wagering is down across the Keystone State.

In that report, the “handle” — the listing of all of the bets waged at tracks or through OTBs and simulcasts — has been declining steadily. From 2009 to 2013, the handle fell from $41,895,000 to $30,842,000.

The handle accounted for only 16 percent of the purses paid out by 2013. Revenue from slots, or video lottery terminals, made up the majority and changed over the five-year period. But overall, total purses fell from $212,713,000 in 2011 to $197,763,000 in 2013.

“Total purses paid decreased by 7 percent in 2013 compared to the same period in 2012,” the report said.

The report also detailed an approximate 20-percent fall in Pennsylvania’s off-track betting from 2012 to 2013.

In 2005, The Meadows operated five OTBs, including the New Castle and Moon Township facilities, and generated a handle of more than $161 million, according to a document from The Meadows. By the end of last year, only two of those OTBs were still open and generated about $82.2 million in handle.

Similarly, purses have been falling in Ohio for years. According to the Ohio State Racing Commission’s 2013 annual report, Ohio’s total handle for 1979 was $438,821,709 compared with 2013’s handle of $190,487,228. Handle had risen as high as $628,783,858 in 1998.

Bob Tenenbaum, spokesman for Penn National, said his company does not plan to open any OTBs in Ohio and hopes bettors come to Hollywood Austintown.

He said Penn National, along with other racino operators, believes VLT revenue will increase “the size of the purses [and] ... dramatically improve the quality of racing, and that hopefully will lead to a revival of the sport,” Tenenbaum said. “I think our feeling is that the better the racing is, the more people it’s going to attract,

and it’s more or less a turnaround of what has been going on for a few decades.”

Chris McErlean, Penn National’s corporate vice president of racing, said the revenue generated by OTBs in the 1990s allowed Penn National to be listed on the stock exchange and go public. But as more forms of betting became available — wagering through phones, Internet, or simulcast broadcasts — some OTBs have closed, such as Penn National’s OTB in Chambersburg, Pa., last year. Chambersburg opened in 1994 and was a 12,500-square-foot facility.

“I think Chambersburg had its life cycle, and it got to the point where the costs weren’t keeping up with the revenue,” McErlean said. He added that Penn National still owns three OTBs in Pennsylvania. “[The] handle has gone down at those facilities over the years, and some of those have been around for 20, 22 years.”

McErlean said the majority of race betting is not done at the racetrack, “but on TVs.” He added that simulcast schedule at Hollywood Austintown can fit into a “niche” for bettors across the country.

Alan Silver, Ohio University assistant professor of restaurant, hotel and tourism and a casino expert, said of OTBs: “I think you know if you can go there and be there, you don’t have the excitement. You don’t have the buzz. You don’t have the ambience or the full package.”

While OTBs have hit a rough patch in Pennsylvania, McErlean said New Jersey just approved them. Penn National is planning to build one there now.

“We are looking at a new model there where we go into an old sports bar/restaurant and outfit it,” McErlean said. He said in the 1990s when OTBs were being built in Pennsylvania, they were 15,000- to 20,000-square-foot buildings.

Silver also said that for July, racinos’ win per day per VLT was $15 more than at casinos.

Silver said he has observed racinos doing better than casinos in the state. He argues that’s because racinos are moving into suburban areas while casinos stay in the cities.

“People in the suburbs now decide, ‘Why the heck do I need to drive?’ It’s very convenient. Some of the racinos have great amenities — Hard Rock [Cleveland], Miami. Austintown is going to be a beautiful facility,” Silver said.

McErlean said, “Betting on horses or making the racing project unique again is a challenge ... certainly we have a nice opportunity in Mahoning [County] to start from scratch and make a good first impression.”

On table games coming to racinos in Ohio, Silver said the racino operators have a good case to make.

“All the racino operators are going to push for it,” he said. “[They’re going to argue] we got a way to get more revenue. We got a way that we can add another product line that is ‘table games’ to our VLT revenue, and we’re going to push for that. Other states have done that, too. You know it might take a couple of years, but sooner or later it’s going to be approved.”

Corona, meanwhile, is excited to see a racino move into his backyard during the “twilight” of his life, as he said. He added that continuing to go to the tracks has helped him keep his mind sharp as he has aged.

“It was an atmosphere that they said was for the rich. The poor man is what supports the racing — the small bettors. But I got into it because it was a challenge on your mind. You had to figure things out.”