For members of the racing community in Ontario County, will neighboring casino be the kiss of death?
FARMINGTON — Developers of the newly renamed del Lago Resort and Casino in Tyre wrote a big check Wednesday, inking their future in Seneca County — and, some would say, the future of the racing industry in Ontario County.
Thomas C. Wilmot Sr. and Brent Stevens, del Lago Resort & Casino co-chairmen, submitted the $50 million license fee payment on behalf of the future casino to the State Gaming Commission.
“We are delighted to announce that del Lago Resort & Casino has fulfilled its initial obligation to New York State and made the $50 million payment for the cost of our casino license,” Stevens stated, adding that he’s “even happier that $10 million of that money will be flowing back” to Tyre and other local governments in the region. Stevens called this the first of many returns on investment that state and county residents will receive from del Lago.
According to state law, $5 million will be shared by the state with the host town and county, and an additional $5 million will be shared by the state with other counties in the gaming region.
“We are even more excited about the progress we are making ...,” Wilmot added in a formal statement. “Thanks to the mild winter weather and a great local workforce, construction of del Lago is proceeding ahead of schedule. We are regularly increasing the number of employees working on building del Lago and passersby can see the structure really taking shape.”
Del Lago is scheduled to open in February 2017.
That’s good news for Seneca County residents who support the development, but for members of the racing community in Ontario County, it could be their kiss of death.
Finger Lakes Gaming and Racetrack (FLGR) Senior Director of Marketing Steve Martin said del Lago Casino & Resort, under construction less than a half-hour down the Thruway, is projected to cannibalize 50 percent of gaming revenues from surrounding facilities, predominantly from FLGR. Independent estimates predict even more — 67 percent of revenues — will be diverted from existing facilities, he said.
The connection between gaming revenue and racing purse structure — or potential earnings for horsemen — is strong, he said. Loss of revenue will directly impact the pounding of thoroughbred hooves at FLGR.
Once del Lago opens in 2017, a drop in gaming floor earnings at FLGR will mean smaller payoffs for winning thoroughbred owners locally, Martin said. This lowers their incentive to race at FLGR, which means the track will have to run shorter seasons with fewer horses per race. This decreases the betting interest per race, which ultimately leads to less betting, he said. It’s a chain reaction.
“If the racing goes, it’s gone,” said Martin. “Those jobs, those families, those productive farms are all gone. That’s an industry unto itself.”
Anticipating loss in revenue once del Lago opens, FLGR has preemptively scheduled 20 percent fewer races in 2016 than in previous years — or 126 races, down from 155 in 2015.
“We have to be proactive — we’re forecasting out,” said Martin. “Ten percent of the earnings on the gaming floor go into the purses that pay the winners of the races. We have to be prepared, based on when Lago opens in 2017.”
Steve Ammerman, New York Farm Bureau public affairs manager, said if racing declines, area farms will be hit hard. The biggest impact, he said, will likely be felt by the local breeders who have horses that currently race at FLGR.
“Equine is an important part of New York agriculture,” said Ammerman. “As an industry, farms provide a great deal of support in the care of the animals. And horse farms use a number of the same agricultural services providers, like veterinarians and farm supply stores. It benefits the agricultural community at large to have a successful equine sector.”
Horse farms also contribute substantially to the tax base and open spaces — both real benefits to local communities, he said.
Ammerman and others are encouraging New York Farm Bureau members, breeders and horsemen to implore Albany lawmakers to support legislation that will mitigate the negative impact of del Lago on “the unprotected Finger Lakes Racetrack horsemen and breeders.”
“Once the del Lago Casino and Resort opens for business, Finger Lakes (FLGR) operator Delaware North is projected to lose up to 40 percent of its gaming revenue,” the letter to legislators states. “This loss of revenue will, in turn, gut the Finger Lakes horsemen's purse account. If not mitigated by legislation, these developments will utterly transform the state's thoroughbred breeding and racing program as we know it.”
While Governor Andrew Cuomo’s 2016-2017 proposed executive budget includes gaming tax relief for Delaware North, it falls short of protecting Finger Lakes horsemen, their potential for earning, and their benefits fund, he said.
New York Thoroughbred Horsemen’s Association President Rick Violette Jr. expressed his support of the legislation, Senate Bill 4367 and Assembly Bill 6345, which would ensure that payments to FLGR horsemen and to the track’s breeding fund would not harmed by the construction of a new casino in close proximity to the track.
In a letter to Senator Jeffrey Klein, Violette said FLGR is a key component of New York’s equine industry, which provides the state with 33,000 full-time jobs and $4.2 billion in economic impact. FLGR’s seven-month racing calendar is essential to the the health of the New York Thoroughbred breeding program, because of the opportunities it affords New York-bred horses, Violette said.
“Without this bill, the cannibalization of gaming revenue from FLGR will do irreparable harm, forcing the track to close and the horsemen to take their business out of state,” Violette stated.
Jockeys’ Guild, Inc. National Manager Terence Meyocks said in a similar letter to the New York State Gaming Commission that an estimated 1,500 jobs are at stake, including those of horse owners, trainers, jockeys and employees.
Mike Manikowski, economic developer for Ontario County, agreed that FLGR is a key player in Ontario County, in terms of employment and financial benefits to the county and to Farmington. It's the largest employer in Ontario County, supporting 1,700 jobs — about 500 directly and another 1,200 in the racing and breeding industry.
Much of Manikowski's concern is for "the county’s significant equine industry," which includes breeders, trainers, boarding facilities, veterinary services, and agricultural and product suppliers, he said.
Farmington Supervisor Peter Ingalsbe believes any significant job losses to Ontario County’s largest employer will have a ripple effect on town and county residents, businesses, and agriculture and agribusinesses like farm implement dealers, seed and fertilizer suppliers, and trucking firms. But the loss could go deeper.
The New York State Equine Industry estimated that in 2012 each racehorse generated an annual economic impact of $92,000. That’s $80 million from FLGR to local economies through equine alone, it said.
As the hand-wringing goes on at FLGR, in stables, on farms and in feed shops, less than half an hour down the Thruway construction is in full swing at the $425 million, 84-acre del Lago.
The sprawling casino, 207-room hotel with multiple restaurants, spa, pool, 2,000 slot machines and 85 table games are a curse to some area residents forced to live with the bedazzled behemoth in their backyard. But they’re a godsend to local officials looking forward to the promised 1,800 permanent jobs, tax reductions, and eventual turbo-boost to tourism.
The resort and casino is slated to open February 2017.
In part two of this series, in Saturday's edition, we’ll talk with some of the individuals whose homes and businesses are at stake if racing continues to decline at Finger Lakes Gaming & Racetrack.