The Votes Are In

At the polls last week, Colorado voters narrowly approved Proposition DD, legalizing sports betting in the state, both in person and online. And in Kentucky’s gubernatorial race, pro-gaming Democrat Andy Beshear claimed victory over anti-gaming incumbent, Republican Matt Bevin, who is requesting a recount. Gaming issues were also on the ballot in Virginia, Indiana and New Hampshire where measures were approved for cities and towns to host more gaming or sports betting.

The Votes Are In

Last week, after a surprisingly close vote, Colorado became the 19th U.S. state to legalize some form of sports betting.

More than 1.3 million Coloradans voted on Proposition DD, a bipartisan ballot measure that will legalize sports betting next year and tax it to fund a state water conservation plan. As of midnight November 5, there were 646,227 votes in favor of Proposition DD—50.2 percent—and 640,537 votes—49.8 percent—in opposition. According to an Associated Press tally later, “yes” votes led by a 51 percent-to-49 percent margin.

Voters in Black Hawk, Central City and Cripple Creek all passed municipal questions authorizing sports betting at the casinos there, opening the door for retail sportsbooks.

The measure was referred to the November ballot by state lawmakers and co-sponsored by House Majority Leader Alec Garnett, and House Minority Leader Patrick Neville. Estimates show that legal sports bets at casinos and through phone apps could eventually bring in $290 million in profits per year, producing $29 million annually for the water fund that needs to raise $3 billion.

Beginning next May, Colorado’s 33 casinos can offer in-person and online wagering on professional, collegiate, motor and Olympic sports. The proposal calls for a 10 percent flat tax on net sports betting proceeds, which is estimated to total about $11 million in the next financial year that starts July 1. The legislature passed a law earlier, allowing for use of those proceeds by the Colorado Water Conservation Board to award grants to help meet the state’s water plan.

 

Kentuckians Elect Pro-Gaming Governor

In Kentucky, meanwhile, Democratic Attorney General Andy Beshear claimed victory over Republican incumbent Governor Matt Bevin. With all 3,659 precincts reporting from the state’s 120 counties, Beshear received 709,577 votes to Bevin’s 704,388, a difference of 5,189 votes, with 99 percent of precincts reporting.

The following day, Bevin filed a formal request for a re-canvass of the vote. Bevin Campaign Manager Davis Paine said, “The people of Kentucky deserve a fair and honest election. With reports of irregularities, we are exercising the right to ensure that every lawful vote was counted.” The campaign has not provided any specifics regarding the “irregularities.” Kentucky Secretary of State Alison Lundergan Grimes the re-canvass would take place November 14.

Beshear stated, “Last night the election ended. It ended and it’s time to move forward with a smooth transition. This isn’t about politics anymore. That ended last night. This is about being the best governor I can be for Kentucky.”

Regarding voting “irregularities” cited by Bevin, Beshear said, “I don’t know what information he’s working off of. We’re confident in the outcome of the election, but today is about moving forward. No one else is going to cast a vote, that ended last night.”

During the campaign, Beshear and Bevin frequently disagreed on expanded gaming, with Beshear noting the state has been losing millions of dollars in tax revenue to Illinois, Indiana and Ohio. All three of those states have casinos directly across from Kentucky cities on the Ohio River. Neighboring West Virginia also offers casino gaming, and the Virginia legislature is considering allowing casinos. Earlier this year Tennessee approved sports betting.

Beshear has called for Kentucky to allow casino gambling, online gambling, sports betting, fantasy sports and online poker. Under his proposal, a maximum of 10 casinos would be allowed statewide. Currently Kentucky has no commercial or tribal casinos, but four of its racetracks offer historical horseracing machines.

Bevin said casino tax revenue would not be nearly enough to address the state’s underfunded pension programs. He also said on a radio show that people commit suicide daily in casinos. He later denied making that claim in a debate with Beshear, even though the recording still was posted on the radio program’s website.

Beshear’s gambling proposals face strong opposition in the legislature where Republicans control both houses. During the campaign, Senate GOP leaders said any casino gambling bills would not pass their chamber.

Virginia Voters Approve Parimutuels in Danville

Voters in Danville, Virginia narrowly approved parimutuel wagering in satellite facilities, paving the way for a Rosie’s Gaming Emporium off-track betting facility which would be owned and operated by Colonial Downs. The vote was 5,083 (51.8 percent) to 4,717 (48.1 percent), according to the state Department of Elections.

Colonial Downs spokesman Mark Hubbard said, “We are extremely pleased. It’s great that voters in Danville saw the potential for good jobs and significant tax revenues and making Danville a better place. This was an important first step, and now we’ll begin in earnest the process of working with Danville city leaders to determine exactly what project the community would like to see.”

Danville City Manager Ken Larking said Colonial Downs hasn’t presented a specific proposal for a Rosie’s location, but the city intends to pursue a casino. the city hasn’t yet received a specific proposal from Colonial Downs for a Rosie’s location, but the city remains interested in pursuing a casino. “We have received a lot of interest from national casino operators who wish to do business in Danville,” Larking said.

Rosie’s would offer historic horseracing machines and betting on real-time simulcast horseraces taking place throughout North America.

Rosie’s currently operates four gaming centers in New Kent which opened in April; Vinton, opened in May; Richmond, opened in late June; and Hampton, opened October 29. The state legislature approved the games in 2017.

According to a recent report from Colonial Downs Group, the four Rosie’s sites have generated $5.91 million in state tax revenue, $2.73 million in taxes for New Kent County, $301,000 in taxes to the town of Vinton, $738,000 in taxes for the city of Richmond and $674 million in total prizes to players, including $17.6 million in parimutuel prizes. The four sites employ more than 1,000 people.

Colonial Downs Group Chief Operating Officer Aaron Gomes said, “We are extremely grateful to our patrons who have embraced what we are offering and helped us keep our commitment. The results are exceeding expectations and we look forward to continued growth, opportunity and economic development.”

 

Indiana County Passes Casino Referendum

By an almost 2-to-1 margin, voters in Vigo County, Indiana passed a referendum on casino gaming, which would allow a land-based casino in Terre Haute. With nearly 98 percent of the 88 precincts counted, votes totaled 15,145 to 8,729, or 63.44 percent in favor to 36.56 against, according to unofficial numbers from the Vigo County Clerk’s Office.

Voters were asked to answer the question, “Shall inland casino gaming be permitted in Vigo County?”

The sponsor of the legislation making the vote possible, state Senator Jon Ford of Terre Haute, said, “I think it was a solid vote that shows Terre Haute was ready for this opportunity, and I’m very happy about the outcome. The community came up during the legislative session and continued to work hard all summer and fall, and I think it sends a solid message to the rest of the state that Terre Haute is open for business, and]we are working to together to move the community forward.” Ford added, “There’s no doubt that had we not seized this opportunity, other communities in Indiana were ready to come after this license.”

Next, the Indiana Gaming Commission will accept and evaluate proposals from casino operators interested in applying for the gaming license. Proposals will be accepted until December 1. The nonrefundable application fee is $50,000. Among the requirements is that developers must make at least a $100 million investment in Vigo County.

The casino license became available after the Indiana General Assembly authorized Spectacle to consolidate its two casinos onto a land-based site. That was approved by the gaming commission on August 28.

A study prepared by The Innovation Group for the Casino Association of Indiana indicated a casino in Vigo County could create 650 full-time jobs and 140 part-time jobs and attract more than 819,000 visitors annually. It projected a total annual economic impact of more than $180 million. Estimated casino tax revenue of $4.6 million would go to the city of Terre Haute if a casino is built inside city limits. Estimated admission tax of $2.6 million would go to the city of Terre Haute, Vigo County government, Vigo County public schools and a regional economic development group.

Spectacle Entertainment Vice President and General Counsel John Keeler said, “We plan to vigorously compete for the license in Terre Haute.” Spectacle is partnering with Hard Rock International to develop the new Gary casino, and that affiliation is expected to help Spectacle’s bid for the Terre Haute license. The $300 million, 225,000 square foot Hard Rock Casino Gary is expected to be completed by December 31, 2020.

Full House Resorts also has expressed interest in operating a Vigo County casino.

Mayor Duke Bennett of Terre Haute said, “We really pulled off something big at the statehouse to get this opportunity. Communities have been wanting to do this for years but got no traction, couldn’t even get a vote in the House or Senate. Now, we’ve got the chance to invest in ourselves. We’re going to bring in brand new money, about $10 million a year, that we can invest in quality of life type of things.”

Meanwhile, Spectacle’s riverboats—including the former Trump Princess, previously owned by current U.S. President Donald Trump—are for sale. They’re listed at $6 million each through Storti Marine Services, a Florida boat brokerage firm. Records indicate each vessel cost more than $45 million to build in the early 1990s.

The 3,500-person capacity Majestic Star is described as being in “impeccable condition.” The former Trump boat, Majestic Star II, has a capacity of 2,990 people.

Between 1993 and 2002, the two boats competed for gamblers side-by-side from 1993 to 2002, the two boats docked at Buffington Harbor. The Trump casino sailed Lake Michigan every odd hour between 9 a.m. and 3 a.m., and Don Barden’s Majestic Star left the dock at the top of the even hours. The boats haven’t sailed since Indiana legalized dockside gambling in August 2002.

Trump sold his Gary license and boat to Barden for $253 million in 2005. Spectacle purchased both boats for an undisclosed sum in March from a Minnesota investment firm that had acquired them out of a bankruptcy settlement following Barden’s death in 2011.

 

Split Decision: 6 of 10 New Hampshire Cities OK Sportsbooks

When Nashua, New Hampshire voters streamed to the polls last week, Jim Rafferty had high hopes they would approve a ballot question to bring a sportsbook to the community, where he operates the River Casino & Sports Bar.

Rafferty’s hopes were dashed, it seems, by the slimmest of margins.

“We’re extremely disappointed,” said Rafferty, in a post-election interview with GGB News. “I knew it wasn’t a done deal, but when you lose by 75 votes out of 9,000, you think maybe a $10,000 media campaign would have done the trick.”

Voters in Concord, Dover and Rochester also turned thumbs-down on sportsbooks, but five municipalities said “yes”: Manchester, Berlin, Claremont, Laconia and Somersworth, for a total of six that will launch early next year (the city of Franklin had already approved the ballot question in a vote on October 1). Next spring, smaller towns and villages in the Granite State will have a chance to snap up the remaining four permits.

In July, Governor Chris Sununu signed legislation to legalize sports wagering, both online and at bricks-and-mortar facilities. The retail and mobile books will be operated by gaming giant DraftKings, with lottery sales handled by Intralot, both under the aegis of the New Hampshire Lottery.

Though New Hampshire has no pro sports teams to call its own, Rafferty said fans there are as rabid as any in New York, New Jersey, Texas, Florida or Illinois.

“All of New England is in love with the Patriots. All of New England is in love with the (Boston) Red Sox. I own and operate a sports bar in Nashua, and people are as nutsy here as anyplace else,” he said. “I think that’s why DraftKings was so ambitious to get in—they see New Hampshire as a $300 million market. And as a Boston-based company, they also see it as their backyard.”

DraftKings scored highest among 13 rivals for the sports betting contract, edging out global firms like William Hill and Kambi as well as Foxwoods, MGM Resorts’ Roar Digital, and a group that included venerable racetrack operator Churchill Downs.

DraftKings was not immediately available for comment, but issued a statement saying it’s committed to “bringing fun, safe and responsible

sports betting to New Hampshire.”

The gaming legislation created a Division of Sports Wagering within the lottery to oversee the new industry. It prohibits wagering on collegiate sports or any college games that take place in New Hampshire. Players must be 18 or older, and the state’s cut of the revenues will fund K-12 educational programs.

Sununu has said he wants to “go fast, fast, fast” so mobile betting can be up and running before Super Bowl LIV in February. Retail locations could open by March, when the NCAA tournament gets under way. All of it hinges on the New Hampshire Executive Council, which still must OK the vendors and their contracts; they’re expected to do so at a meeting on November 20.

The governor’s urgency aside, Lottery Executive Director Charlie McIntyre told GGB News the sportsbook sites have yet to be determined, and the lottery will “take some time” to plan and develop the best destinations.

“Now that sports betting’s been approved, it’ll be part of our portfolio for years to come, so we want to do it right. By spring, we’ll identify locations and then get renderings of what they should look like. We regulate the gaming facilities, but these are conversations we want to have with DraftKings. This is a partnership here.”

McIntyre previously told New Hampshire Public Radio the retail betting parlors will resemble “your favorite sports bar—a place where you can get food and a beer, (with) a couple of windows where you can place a bet.”

DraftKings will be able to open its own facilities, or partner with existing retail establishments. That’s where Rafferty may have lost out. And while he’s disappointed now, he thinks New Hampshire voters will be persuaded over time.

“People are so skeptical of gaming referendums,” he said, pointing out that his operations alone have contributed $3.3 million to state charities over 10 years. “We’ve tried to be good citizens and helped a lot of people. And despite that, the gaming legislation failed. But I think things are going to change.

“Here in New England, people want their communities to change in small bites,” he said. “The church steeple, the centerpiece of the New England town or village, is really important to people, and they want change at a slower pace. I’ve argued that it’s unrealistic in today’s environment. The world doesn’t move that slow anymore. We have to move forward and evolve, because this is a technology people really enjoy, and it could be huge.

“I just don’t think we can sit this one out.”