Legalized gambling: racing for dollars - horse racing

New Mexico Business Journal, Feb, 1991 by Walter K. Lopez

LEGALIZED GAMBLING Racing for Dollars

New Mexico doesn't come close to matching the neon glitter of Nevada or the felt table haven on New Jersey's eastern boardwalk. And you will be hard-pressed to find legal blackjack, raps and roulette tables in the Land of Enchantment.

But legalized gambling still is big business in the state.

Horse racing offers New Mexicans the state's most popular form of gambling with thoroughbred and quarter horse racing at six race tracks.

Bingo now touches almost every community in New Mexico, while at least three Indian tribes in the state conduct high stakes bingo. And not far in the future lies a real possibility of the first-ever lottery for the state.

For now, horse racing is king in New Mexico, growing to a $250 million a year industry in just more than five decades.

The state legislature passed the first official pari-mutuel law in 1934, although racing didn't get off the ground until 1938 with an inaugural 10-day meet in Tucumcari. That was followed by an eight-day run at the New Mexico State Fair in Albuquerque, currently the state's oldest meet.

New Mexico today features seven racing meets at six tracks. They include a winter-spring meet at The Downs at Albuquerque, conducted at the State Fairgrounds; summer meets at Ruidoso Downs; The Downs at Santa Fe; La Mesa Park in Raton; San Juan Downs in Farmington; a fall meet at the New Mexico State Fair in Albuquerque; and a fall-winter-spring meet at Sunland Park near El Paso.

According to the nationally-recognized accounting firm of Price Waterhouse, which conducted the last major study of the state horse racing industry in 1987, the industry creates about 6,000 jobs with an annual payroll of more than $8 million.

The racing commission licenses nearly 12,000 in the state, from grooms, riders, trainers and owners at one end of the scale, to farriers and veterinarians at the other.

The tracks alone employ about 2,600 people (tellers, admission, etc.) with a payroll of about $7.5 million.

The future indeed appears bright for the industry, but it wasn't always rosy. With horse racing riding the tide of a strong economy in the early '80s, race tracks were posting record numbers in pari-mutuel handle and attendance. But the state's thriving oil and gas industry took a sudden detour southward and with it went the economy. The industry received another tough blow when the racing commission uncovered a state-wide drug scandal, alleging widespread use of illegal drugs in horses.

Santa Fe attorney Robert Rivera, who doubles as a lobbyist for Santa Fe Racing Inc., parent company of The Downs at Albuquerque and The Downs at Santa Fe, noted the industry's remarkable turnaround with the scandal.

"The commission was facing intense pressure to rid the industry of the problems and they did a really good job on turning the corner. They should be duly credited," Rivera says. "And the same commission, rather than focus on enforcement, has made a good attempt at promoting racing and the entire industry has benefitted."

In 1989, racing fans bet $133.6 million on live racing in the state. A whopping $106.4 million, or 79.6 percent of the amount wagered, was returned to the bettors; $26.2 million, or 19.6 percent, went to the State Racing Commission; an $1.7 million, or .8 percent, to state taxes, marketing, capital improvements and breakage.

In addition, the state earned $1.7 million from taxes, fees and fines in horse racing.

Although the final percentages for 1990 are not yet complete, 1.5 million patrons wagered $161.5 million at the seven meets with 430 live racing days. The handle (total amount wagered) and attendance figures are increases over 1989.

"I think we're on our way to better things like additional simulcasting, intertrack wagering and the possibility of common pooling (routing all wagers from simulcast locations into one central pool)," says Tom Golder, executive secretary of the New Mexico Racing Commission.

The driving force in horse racing's resurgence in New Mexico is intertrack wagering. Legalized by the legislature in 1989, intertrack wagering allows New Mexico race tracks not conducting live racing to simulcast and accept wagering on races from tracks with live racing in the state.

In nearly 20 months since its inception, intertrack wagering has caught on like wildfire at all six New Mexico tracks. Although all tracks receive simulcasting signals through the course of the year, there are only four host tracks: The Downs at Albuquerque, The Downs at Santa Fe, Ruidoso Downs and Sunland Park.

"The simulcasting in the state of New Mexico has been a godsend to all tracks, especially Sunland Park," says Gary Amundson, vice president of Sunland Park, which teamed with Ruidoso Downs to form Southeast Simulcasting.

Intertrack wagering not only has helped New Mexico's race tracks improve their wagering and attendance figures, but it also has significantly boosted the purse structure for the horsemen.

Amundson says when Sunland Park completed its 1988-89 met, it had overpaid purses by $40,000. But intertrack wagering debuted first at the southern New Mexico track in June 1989 and by the time the 1989-90 season opened, Sunland had generated $380,000 in revenue.