Copyright © 2018 Albuquerque Journal
The state’s five racetrack-casinos have asked the New Mexico Racing Commission not to issue a sixth racing license this year, saying that doing so would harm an industry that is by some metrics “far from healthy,” according to a letter obtained by the Journal.
The letter, dated Nov. 13 and addressed to the commission’s chairman and vice chairwoman, is signed by representatives of The Downs at Albuquerque Racetrack and Casino, Sunland Park Racetrack and Casino, Ruidoso Downs and Billy the Kid Casino, SunRay Park and Casino near Farmington and Zia Park Casino Hotel and Racetrack in Hobbs.
“It is our opinion that the issuance of a sixth racing license would be contrary to the Commission’s stated mission and would result in economic harm, instability and uncertainty for all segments of the state’s horse racing industry,” the racinos wrote. “Instead, we feel the Commission’s focus should be on working with the current stakeholders to improve, embrace, enhance and grow the horse racing industry.”
Don Cook, director of racing operations at The Downs at Albuquerque, declined to comment. The four other racinos and the Racing Commission’s executive director, Izzy Trejo, were not immediately available for comment Tuesday.
Five bidders are competing for the sixth and last New Mexico racino license permitted under tribal compacts. Three of the five bids propose a racino in Clovis; the two other projects are proposed for Tucumcari and Lordsburg. The commission is expected to make a decision – which could include opting not to issue a license – on Thursday.
In their letter to the commission, the racinos described a racing industry in New Mexico “that is far from healthy and not in need of additional forces creating additional downward pressures.”
They said the decline of the horse breeding industry here and nationally will make it difficult to find animals to race on a sixth track; attendance at live races and those that are simulcast are already falling; and the presence of a sixth track would cannibalize revenue generated by the existing racinos, among other concerns.
The Racing Commission in November released a feasibility study exploring the practicality of a sixth racino in the state. In it, New Orleans-based consulting firm Convergence Strategy Group was less than definitive on whether a sixth racino license would be prudent from a racing standpoint.
“The two greatest concerns raised in evaluating the bids and listening to some of the parties in the State with a vested interest are: Does New Mexico have the manpower and the horse power to support another track?” the company wrote in the report. “It is difficult to say for certain, but with a strategic alignment of dates and horses, the State could absorb the additional dates and provide more value to New Mexico horsemen, which could help stabilize and grow the industry in the State.”
The bidders have argued that drawing attendees from Texas would bring in new money and revitalize the racing industry, creating a larger market that would benefit all of the state’s racinos.
Data provided to the Journal from the state Taxation and Revenue Department show that, in aggregate, net win has fallen in recent years for the state’s five racinos. Net win is the amount wagered on slot machines minus payouts and fees, and is considered a key indicator of gambling activity.
In 2015, racinos reported a total of $255.8 million in net win.
The next year, the amount fell to $232.4 million. In 2017, the most recent calendar year for which such data are available, racinos reported $227.4 million in net win.