Arlington Park's Future Uncertain: Financial Woes Plague Race Track
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ARLINGTON HEIGHTS, Ill. — Arlington Park might look as healthy as ever on Saturday.
The Arlington Million is expected to draw around 30,000 spectators to the old track in suburban Chicago to take in its marquee event and maybe walk away with a few more dollars.
Yet behind the scenes, a different kind of race is unfolding. Actually, it's a fight – a fight for financial survival.
Officials for Arlington Park and its parent company, Louisville, Ky.-based Churchill Downs Inc. say the future of the track and the industry is grim unless alternate forms of gambling are approved.
"We have this world-class facility here," Arlington Park president Roy Arnold said. "It would be absolutely tragic if we weren't able to entertain the public and conduct racing here during the summer here in Chicago."
The problem is this world0class track is only "marginally profitable," Arnold says. And if the revenue drops, "it's just simply not realistic to believe that shareholders would continue to support expending resources in Illinois with no prospect of a return."
Shuttering the 83-year-old track is not a consideration at this point, nor is selling it, but officials say gambling is necessary for survival not only of the track but racing as a whole in Illinois.
Last spring, proposed legislation that would have legalized slot machines at Illinois racetracks stalled amid opposition from riverboat casinos and anti-gambling lobbyists along with some loose ends that needed to be tied up. Arnold thinks the industry has the votes in the state Assembly and can get enough in the state Senate to get approval this fall after lawmakers reconvene.
But if not, how long can Arlington last?
"I don't know," Churchill Downs corporate spokeswoman Liz Harris said. "I don't think anyone has that answer."
Is the track for sale?
"No," she said.
Has that been discussed?
Again, she said no.
"It's one of our properties," Harris said. "It isn't even something that's in consideration. It would be like saying is Churchill Downs for sale? No."
Even so, their footing is shaky.
In June, Churchill Downs CEO Bob Evans indicated Arlington Park's future was in doubt and that even the company's namesake track might have to cut race dates unless alternative forms of gambling such as slot machines are allowed.
"You can't run on hope," he told The Courier-Journal newspaper. "If we get to the point where you know 'not racing' is the best answer, well that's the best answer. But we're not starting there, and I hope we don't get there."
Two of the company's four tracks – Calder Casino & Race Course near Miami and Fair Grounds Race Course in New Orleans – offer other forms gambling. Churchill Downs and Arlington Park do not.
Evans told the newspaper at the time that the company was planning an internal review of all four tracks that would consider the potential for alternative gambling at Arlington and Churchill Downs. But Harris said that's "a process that we're always going through with all the properties that we have."
"That was nothing specific," she added. "It was a non-specific, non-event. It isn't something that's going to come to fruition with a specific answer."
The answer that Arnold is looking for would come from the state. That would be legalizing slots on site, which in turn would put Illinois tracks on more even footing with those in other states that feature alternative forms of gambling and help fund statewide construction and education.
"Who we're really in competition with are the other racetracks across the United States," Arnold said. "And we're competing for customers like any other business. And customers are going to choose our product based upon its quality and accessibility. Quality is directly related to the caliber of racing, and that's fueled by purses."
He pointed out that while Churchill Downs doesn't offer other forms of gambling, it happens to host the Kentucky Derby and that provides enough financial support to get that track through the year.
Arlington, however, has neither a Triple Crown race nor the slots.
What it has is a long history that dates back to when Joe Bollero rode Luxembourg to victory in the first race on Oct. 13, 1927. It survived the Depression and World War II, and began hosting the world's first million-dollar race – the Arlington Million – in 1981. Bill Shoemaker led John Henry to victory that year, but there have been difficulties along the way.
A fire in July 1985 destroyed the grandstand, putting the park's future in doubt. In the 1990s, Arnold said, the state delivered an inadvertent blow by allowing riverboat casinos, and Arlington wound up closing for two years following the 1997 season before merging with Churchill Downs.
It still is on shaky ground, just like other tracks around the state.
"We face a catastrophic possibility if we aren't enabled the same legislation that takes place in other states," said Illinois Thoroughbred Horsemen's Association president Mike Campbell, who's had horses racing at Arlington since the early 1980s.
Arnold said some tracks in Illinois will close if the bill doesn't pass, and although Arlington would probably be the last in the state, it's "not immune from that potential."
A more immediate result would likely be more reductions in purses and race dates.
The track recently cut nearly $800,000 in stakes purses, although the Million and two other Grade 1 stakes were untouched. And since he arrived in 2006 following a 30-year career in the Marines, Arnold has seen Arlington go from running five days to mostly four a week from May through September. It pays about $20 million in purses over 91 dates, which he said "is not a bad number relative to other tracks across the country."
But if they had to trim $5 million or $10 million?
There would be more cuts in the schedule, and year-round racing in the Chicago area could become a thing of the past.
"That means that if you're a racing official, if you're an outrider, if you're a gate crew person, if you're a food and beverage person, if you're a mutual clerk and you work at racetracks, there's no longer year-round employment," Arnold said. "So now you're looking at 30 days here or 30 days there or 60 days, maybe, and you get into this issue where can you continue to attract and retain talent? I think the answer is no."
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ANDREW SELIGMAN 08/17/10 04:48 PM ET Associated Press