Racino issue gets national attention Gambling industry seeks growth

Maine’s simmering racino controversy has drawn the attention of gambling industry analysts and out-of-state gambling companies.

Analysts said the racino issue in Maine has drawn the attention because it is the only place nationwide where horse tracks with slot machines have found a foothold this year.

Because of that, Tuesday’s referendums in Westbrook and Saco, where voters will decide whether to allow racinos in their cities, are being closely watched within the gambling industry. The industry has experienced slow growth this year.

“If [racinos] open up in Maine, this will boost the growth numbers,” said Ryan Worst, a racino analyst with C.L. King Associates in New York.

“It’s the only thing going on in the industry right now,” said Sebastian Sinclair of Christian Capital Advisors, a New Gloucester company that researches the gambling industry.

Mainers in November approved a statewide referendum allowing slot machines to be installed at the Bangor Raceway and Scarborough Downs if the host communities approved.

Bangor voters approved of a racino last June, but Scarborough voters rejected a racino in their town.

The law allows Scarborough Downs to locate a racino within five miles of its current location, as long as local residents approve the measure by the end of the year.

Scarborough Downs and its business partner, Penn National Gaming, have waged a campaign to convince voters to support the referendums.

Meanwhile, the owner of Bangor Raceway, Shawn Scott, appeared this month before the Maine Harness Racing Commission for hearings to get a license to operate a racino in Bangor. The hearings will continue next week.

Analysts said competition for new business is intense in the gambling industry, but it seems nastier in Maine than elsewhere.

The campaign has featured multiple lawsuits and attack ads against Penn National and Scarborough Downs in hopes of defeating the Westbrook and Saco referendums.

“I can’t say I have ever seen this,” said Jane Pedreira, a gambling analyst with Lehman Bros. in New York. “Usually racing [interests] will pull together so you will not see any type of infighting. This is a little more atypical.”

Dennis Bailey, spokesman for the anti-racino group CasinosNo!, said the turmoil among those who want to bring slot machines to the state is helping the anti-racino cause.

He said voters dislike the hardball tactics in the racino campaigns and aren’t making distinctions between the different companies.

“People are asking, ‘Are these the type of people we want to invite to our community, suing each other, calling each other names and fighting?”‘ he said.

Besides Maine, racinos are allowed in Rhode Island, Iowa, Louisiana, Delaware, New Mexico, West Virginia and New York.

Proposals to allow slot machines at horse tracks have been rejected in Colorado, Maryland, Pennsylvania, Ohio and Kentucky.