Delaware Cuts Purses Double Digits

[Shemp Howard]

For the first time since slot machines were introduced in Delaware in 1995, Delaware Park, near Wilmington, has cut horse-racing purses in the middle of a racing season, according to a horse-racing official.

The new purses, which take effect Saturday, range from $31,000 to $33,000. They are down by about 15 percent, or by $5,000 to $6,000.

They reflect a continued slide in slots revenue, which subsidizes horse racing in Delaware as it does in Pennsylvania, forcing the cuts, which will enable the track to finish its season of 81 race days, an official with the Delaware Thoroughbred Horsemen's Association said.

"We shaved 19 days off our schedule to keep the purses at a higher level, but since then the level has dropped again, so you either have to lose more days or you have to adjust your purse schedule. There's only two ways to go in and slice that," said Bessie Gruwell, executive director of the association.



Delaware Park shortened its racing season last year.

Delaware has casinos at three race tracks. In addition to Delaware Park, there are casinos at Dover Downs, near Dover, and at Harrington Raceway.

Slot machine revenue for the three casinos was $637 million in 2006, when the first Pennsylvania casino opened. It has fallen every year since. Last year, Delaware slot machine revenue was $375 million, and it is down nearly 10 percent for the first six months of 2014.

Horse racing's slice of that revenue fell to $34 million last year from $72 million in 2006, according to data from the Delaware Lottery, which regulates casino gambling.

Conditions are not expected to improve with the scheduled opening of a casino in downtown Baltimore at the end of this month. Delaware lost significant gambling revenue when Maryland Live! opened in Hanover, Md., two years ago.

The money in the Mid-Atlantic region gets split into smaller and smaller slices, Gruwell said: "We're all trying to attract the same basic customers."

[alhattab]

For the first time since slot machines were introduced in Delaware in 1995, Delaware Park, near Wilmington, has cut horse-racing purses in the middle of a racing season, according to a horse-racing official.

The new purses, which take effect Saturday, range from $31,000 to $33,000. They are down by about 15 percent, or by $5,000 to $6,000.

They reflect a continued slide in slots revenue, which subsidizes horse racing in Delaware as it does in Pennsylvania, forcing the cuts, which will enable the track to finish its season of 81 race days, an official with the Delaware Thoroughbred Horsemen's Association said.

"We shaved 19 days off our schedule to keep the purses at a higher level, but since then the level has dropped again, so you either have to lose more days or you have to adjust your purse schedule. There's only two ways to go in and slice that," said Bessie Gruwell, executive director of the association.



Delaware Park shortened its racing season last year.

Delaware has casinos at three race tracks. In addition to Delaware Park, there are casinos at Dover Downs, near Dover, and at Harrington Raceway.

Slot machine revenue for the three casinos was $637 million in 2006, when the first Pennsylvania casino opened. It has fallen every year since. Last year, Delaware slot machine revenue was $375 million, and it is down nearly 10 percent for the first six months of 2014.

Horse racing's slice of that revenue fell to $34 million last year from $72 million in 2006, according to data from the Delaware Lottery, which regulates casino gambling.

Conditions are not expected to improve with the scheduled opening of a casino in downtown Baltimore at the end of this month. Delaware lost significant gambling revenue when Maryland Live! opened in Hanover, Md., two years ago.

The money in the Mid-Atlantic region gets split into smaller and smaller slices, Gruwell said: "We're all trying to attract the same basic customers."

Hopefully Delaware will be the first state to come to its senses and significantly curtail or completely eliminate racing. Unlike PA, as far as I know there is no meaningful Delaware breeding program or other excuse to maintain racing for the sake of jobs. As stupid as that argument seems to me, I can see it being made in PA where there has been a meaningful increase in breeding operations and in related supporting industries.

[alhattab]

Just read Monmouth is also cutting 10% effective 8/8

[Some_One]

And for comparison sake, Hong Kong announced last month their raising purses 10% for the 14/15 season.

[JustRalph]

The slide continues. As predicted by many.

Only twenty more tracks to go

[Tom]

They will have to card more races to make up for the loss of money.

[Some_One]

They will have to card more races to make up for the loss of money.

Take that back now!

[nearco]

And for comparison sake, Hong Kong announced last month their raising purses 10% for the 14/15 season.

They did this without slots? Amazing :eek:

[Some_One]

They did this without slots? Amazing :eek:

One of the main reasons was they got the government to change how they were taxed, moving from a % of each bet to a % of the club's profits, which allowed the HKJC to offer a 10% rebate on losing bets. They had to promise that the 'contribution' (i.e. taxes) to the government would not go below a certain baseline level and except for a slight top up in the first year (if I remember correctly), their contribution has gone up every year.

Of course the HKJC fan-awareness programs are great and Happy Valley has a great atmosphere for the causal fan IMO

[lamboguy]

pretty soon the slot machines are going to need to be subsidized by the racing.

[Big Russ]

Del Park is one of my favorite places to attend live racing. I cannot imagine how losing a venue such as this could be good for our sport. Yes, it's incredibly frustrating that there are not enough owners/horses to support the amount of racing going on in the summer. But the long-term solution is not to keep closing tracks and cutting racing. We must grow interest to the point where we get a lot more people involved as owners.

[forced89]

Ship to Oaklawn for Jan - Apr. Their purses go up year after year.

[VeryOldMan]

Just read Monmouth is also cutting 10% effective 8/8

Looks like Charles Town has also just cut purses in the 5% range. Former $11,000 purses are now $10,500; MSW cut from $26,000 to $25,000, etc.

[Seabiscuit@AR]

Hong Kong racing does get funding from the HKJC offering soccer betting which is the same as the slots money

But the guy running HK racing at least understands that the most important thing is to get more money wagered on the races instead of giving up on betting turnover from the horses and relying on slots welfare to survive

[Track Collector]

Looks like Charles Town has also just cut purses in the 5% range. Former $11,000 purses are now $10,500; MSW cut from $26,000 to $25,000, etc.

They have also reduced the number of races on Wednesdays and Thursdays from 9 to 8.

[levinmpa]

They gave the slot money to the horsemen, but none of it went to the horseplayers in the form of takeout relief or seeded pools. If they just gave the players a nugget or 2 in the form of takeout relief, they could grow the handle, and wouldn't have to rely on the slots revenue. It seems like a no-brainer, but not one Racino in the country has given any of the slots windfall to the horseplayer. Now they are all in jeopardy of losing the slots revenue while handle decreases. It was so predictable.

[BlueShoe]

They will have to card more races to make up for the loss of money.
"No, just raise the takeout a few percentage points to increase the revenue. The fans are too stupid to notice the difference and won't care." :rolleyes:

[Redboard]

They gave the slot money to the horsemen, but none of it went to the horseplayers in the form of takeout relief or seeded pools. If they just gave the players a nugget or 2 in the form of takeout relief, they could grow the handle, and wouldn't have to rely on the slots revenue. It seems like a no-brainer, but not one Racino in the country has given any of the slots windfall to the horseplayer. Now they are all in jeopardy of losing the slots revenue while handle decreases. It was so predictable.

Exactly. Delaware Park had a golden opportunity to make something special before the surrounding states got their own casinos: a short, say two-month, meet (June and July), million dollar a day purses, low takeout on all bets, say 10%. Now who here wouldn’t bite on that?
They HAD the money to do that. But the window of opportunity is gone now. Beautiful track though.

[Fred]

Charles Hayward

After attending the 2014 Asian Racing Conference in May, I wrote a commentary suggesting that wagering indicators in the United States and Great Britain did not compare favorably with the other four major racing jurisdictions: Australia, France, Hong Kong, and Japan. Now, I turn my attention to the U.S. Thoroughbred racing business.

There is a longstanding and serious structural problem in Thoroughbred racing in the U.S. The highest quality racetracks do not receive appropriate compensation for their signal in the simulcast and Advance Deposit Wagering (ADW) markets. In addition, too many small, low-level tracks are incentivized to run races to maintain their simulcast or alternative gaming licenses. Races run at low-rung claiming levels do not make economic contributions back to the industry in the form of purses and breeder awards, and research has shown that horses running in claiming races run a higher risk of sustaining catastrophic injuries.

~~read the rest at link~~

https://www.thoroughbredracing.com/commentary/unsound-financial-foundation-points-troubled-future-us-racing

[VeryOldMan]

FYI - here's the URL to the article in Fred's post:

https://www.thoroughbredracing.com/commentary/unsound-financial-foundation-points-troubled-future-us-racing

[JustRalph]

Del Park is one of my favorite places to attend live racing. I cannot imagine how losing a venue such as this could be good for our sport. Yes, it's incredibly frustrating that there are not enough owners/horses to support the amount of racing going on in the summer. But the long-term solution is not to keep closing tracks and cutting racing. We must grow interest to the point where we get a lot more people involved as owners.

This ship has sailed. Never coming back. Contraction is the only answer

[badcompany]

What's happening in Upstate NY will probably be the model for how casinos extricate themselves from Horseracing:

A company that owns a Racino gets a license to open a full service casino somewhat nearby.

The new casino canabalizes the customers of the Racino.

The company closes the, now unprofitable, Racino, and ends it relationship with Horseracing.

[Cholly]

FYI - here's the URL to the article in Fred's post:

https://www.thoroughbredracing.com/commentary/unsound-financial-foundation-points-troubled-future-us-racing

That's a very good op-ed piece. It puts in quantitative terms some things you just knew intuitively were askew. That stat about prize money yield is an eye-opener.

Thanks Fred & veryveryOld for the post + link.

[gheuks]

Only eight races on a Saturday, one of which is an Arabian race?? Awful field size the past few years and now this. Del park is becoming what it was prior to slots... Beautiful track with cheap claimers

[therussmeister]

They gave the slot money to the horsemen, but none of it went to the horseplayers in the form of takeout relief or seeded pools. If they just gave the players a nugget or 2 in the form of takeout relief, they could grow the handle, and wouldn't have to rely on the slots revenue. It seems like a no-brainer, but not one Racino in the country has given any of the slots windfall to the horseplayer. Now they are all in jeopardy of losing the slots revenue while handle decreases. It was so predictable.
Prairie Meadows reduced their takeout when they first got slots, and Delaware Park had reduced exacta takeout for on-track bettors.

[Shemp Howard]

Prairie Meadows reduced their takeout when they first got slots, and Delaware Park had reduced exacta takeout for on-track bettors.

All 3 of them?

[alhattab]

This ship has sailed. Never coming back. Contraction is the only answer

It really is. Tracks like Delaware serve very few fans compared to a track like Monmouth which will draw 20,000 people over the course of a 3 day weekend. We need the product to be stronger at the tracks that can draw live bodies in order for the sport to grow. In the East, I'd love to see a boutique meet at Delaware run around the Delaware Handicap, and for Parx to close during the summer and re-open with a bang in September for the PA Derby meet. It's a UK-like model for a region that has a similar geographic dispersion of tracks to the UK.

I'm obviously partial to Monmouth but think that strong racing at the well-attended venues is what is best for the sport. Those who have been there know that it draws a fairly young crowd because it is a part of the community here. That helps perpetuate interest in the sport long-term.

[Stillriledup]

Didnt want to start a new topic, but the 2nd race exa at Delaware was only 200 and change? Did i see that right?

[castaway01]

Didnt want to start a new topic, but the 2nd race exa at Delaware was only 200 and change? Did i see that right?

$577

[Secondbest]

I just read that suffolk might close.I t seems They lost a to Wynn to build a casino.Anyone else read that?

[Secondbest]

I see there's a thread about that. I missed it