Commerce Casino tries its luck with off-track betting - Monday 27th of July 2009

Beginning this weekend, horse racing fans can place bets and watch televised races at the Commerce Casino, the first new off-track betting site approved under a statewide initiative to whip up the struggling horse racing industry.

At the new site, gamblers will be able to bet at electronic kiosks and follow races from across the country on a bank of 26 television screens. It will be the first of 15 new wagering sites -- sometimes called OTBs -- permitted by legislation approved in Los Angeles, Kern, San Bernardino, Santa Barbara and Ventura counties.

State and gaming officials are hoping the casino will be the first of 45 new "mini-satellite" sites allowed in sports bars, card clubs, casinos and other gathering spots. The new sites, allowed under a 2007 state law, are in addition to the 34 betting facilities already operated by racetracks, tribal casinos and fairgrounds.

So far, only two others -- a tavern and a restaurant in San Francisco -- have applied with the California Horse Racing Board to operate one of the newly permitted facilities. Gaming officials said the Commerce Casino site would be a test model to gauge the success of the initiative during troubled economic times.

In fiscal year 2007-08, horse races in California were responsible for $4.4 billion in wagers, according to the racing board.

Attendance at Southern California racetracks has remained steady, but betting -- the industrys main source of income -- has dropped off by about 10% in the last year, according to racetrack officials.

But some analysts say an expansion of off-track betting sites wont do much to increase revenue in the short term.

Matt Jacobs, a senior analyst for Majestic Research Corp., said state and local governments had a tradition of expanding gambling venues in tough economic times to bolster revenue from gambling fees. Although such tactics might generate new revenue in the long term, he said, they rarely boost returns in the short term.

"This is not going to be a panacea for the gaming business to simply add more places to gamble," he said.

Under the new law, card clubs, casinos, sports bars and other businesses can file an application with the California Horse Racing Board for one of the 45 new sites statewide -- 15 in each of three racing zones throughout the state. The new off-track betting sites cannot operate within 20 miles of an existing satellite wagering facility without the consent of the operators of the existing site.

Owners and managers of several Southern California racetracks concede that they may lose patrons to the new off-track betting sites.

But racetracks such as Hollywood Park, Del Mar Thoroughbred Club and Santa Anita Park will benefit financially in the long run by collecting a share of every bet placed at the off-track sites on races at those parks, according to state gaming officials.

"We are incredibly excited about this," said Craig Fravel, executive vice president at Del Mar Thoroughbred Club, north of San Diego. "If patrons were inclined to go to other places to make wagers . . . we are not worried about that."

Ron Charles, Santa Anita Park president, also praised the expansion, saying the added convenience of new off-track betting sites will draw new enthusiasts, such as card players and sports fans at casinos and sports bars, to horse racing. Some of the existing off-track betting sites are old and in poor condition, he added.

"The advantage is its more convenient and it allows existing fans to have better, cleaner and nicer facilities to go to," Charles said.

The operators of Fairplex Park in Pomona, one of the 34 existing satellite wagering sites, invested about $1 million last year to relocate and upgrade their gambling site in hopes of attracting new customers.

Even though the new off-track venue at the Commerce Casino will mean more competition for the existing gambling sites, the Fairplex Park operators support the expansion.

"We are on the same wavelength as the rest of the industry," Fairplex spokeswoman Wendy Taralico said. "Any addition to the sport, attracting new customers and creating a new customer experience, will only benefit the overall industry."

Even professional gamblers like the idea.

"I think its a good thing for the casino," said Greg Mascio, a professional poker player who plays regularly at the Commerce Casino. "For people who live in the area, its more convenient to come here than drive to Los Alamitos or some other place to make a bet."

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