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Texas is finally entertaining the idea of installing slot machines at their racetracks.  There is no bill on the table or even being passed around the legislature, but the Legislative Study Group of the Texas House of Representatives did hold a meeting on the potential of gambling expansion in the state.  Of course, Texas’ horse racing industry is behind the push for slot machines.  However, the state has a lot to gain from gambling expansion.

Andrea Young, president of Sam Houston Race Park in Houston, Texas, slot machines at racetracks could generate about $1 billion a year for Texas state coffers.  The state could really use the money as the struggle with budget issues.  Surprisingly, the racetracks are not being stingy with their proposal for gambling expansion.  As a part of the proposal that was discussed by the Legislative Study Group, there was a suggestion of allowing the state three Indian reservations to operate slots parlors.

The size of Texas alone would make it a great market for casinos and slot machines.  Many states, like in the northeast, smaller states, compete for gambling dollars from residents.  Their objective is to steal a few gambling dollars from neighboring states while maintaining the gambling dollars of their residents.  There are areas in Texas that are not a convenient drive to any state.  There for it might be wise if Texas were to focus on creating resort casinos in order to keep their residents and draw in a gamblers on a national or even international scale.

There is a myth being perpetuated that slot machines are saving the horse racing industry.  If you give that idea even half a thought, you would realize how little sense that makes and how it is virtually impossible for slot machines to save horse racing.  Horse racing has certainly utilized slot machines to keep their industry growing.  Slot machines have also become an important tool so that racetracks can continue to compete with each other.  But, slot machines are not and cannot save the industry.

Nothing can save the horse racing industry except the horse racing industry.  The problem with horse racing is that it is losing favor with modern audiences.  It is not exactly clear why, but one theory is that it is a simply antiquated form of gambling.  People love to gamble as a pastime and likely always will, but in our instant gratification society, horseracing just does not fit in.  Slot machines are a popular form of gambling because play is rapid and you can win a lot of money.  Many people do not have the patience or interest to set around at a track all day or to wait for horses to run around a track before the find out if they win or not.

Slot machines cannot save racing because slot machines cannot rekindle public interest in horseracing.  While slot machines continue to subside the industry, it can do nothing to stop the declining interest in horseracing.   That is why slot machines at a track are often viewed as a waste of revenue.

A poll was recently taken revealing he Texas voters would likely favor slot machines if they were given the option to vote on it.  Texas is a large state and is also suffering budget issues due to the recession.  I am actually surprised that Texas has not yet legalized casino gambling.  The state has a lot of motivation to do so.  There are quite a few horse racing venues in Texas, they are most of the momentum behind the push to get slot machines.  Surrounding states like Louisiana have slot machines at their racing venues.  This makes it impossible for Texas venues to compete with Louisiana.

No matter what state you go to, the horseracing industry is suffering.  Even in states where the tracks offer slot machines.  Racino tracks are not in need of anything because slot machines are subsidizing their expensive industry but they still are not drawing in as many live wages as they once did and live wagers are still on the decline.  Since the concept of a racino was introduced back in the 90s in Delaware it has not even been proven that slot machines even improve track attendance.  Sure people show up for the slot machines, but it does not mean the ever venture out to the tracks.

However, slot machines do allow tracks to remain competitive within their industry.  Slot machines allow tracks to paid their purses and draw in the better horses and races by offering more money.  However, slot machines are not necessarily saving the industry.

When New York State legalized the operation of electronic slot machines at state racetracks, the Aqueducts venue in Queens had the most potential of all the other eight venues in the state.  Aqueduct racetrack is the venue that is closes to the 9 million residents of New York City; a population that spans the entire economic spectrum of the United States.  However, with all of the potential it remained, for almost 10 years, the only venue that never successfully found an operator.  The other venues found operators and installed slot machines very quickly.  It may have been the pressure to get slot machines done absolutely right in Aqueducts the made the process so difficult.  But, some instances it has been shown that a lot of shady political infighting is to blame.

When Governor Elliot Spitzer was running the show, he attempted twice to sell the crumbling racing venue.  Both deals fell through.  In 2008 he decided to start over.  When current Governor David Paterson took over he awarded an operators license to Delaware North.  Unfortunately Delaware North was unable to come up with the required $370 million as an upfront fee. This was March of 2009.

A few months after that, the bidding process was reopened.  There were a lot of serious contenders in line, but it seemed the SL Green and Hard Rock International was the far superior contender.  When Governor Paterson inexplicably selected Aqueduct Entertainment Group the deal fell apart amongst accusations of favoritism.

Hopefully the current bidding process will be more successful.

Ever since 2001, New York State has been trying its best to find an operator to run a casino out of the Aqueducts racetrack in Queens.  Now that they are finally serious about the effort and looks like they may soon close a deal, the federal government has finally formally recognized the Shinnecock Indian tribe of Southampton.  The tribes land is very close to New York City and the millions of New York residents could easily access it by public transport.  So there is no doubt that the tribe is going to pursue the necessary path of building a casino.  And because being recognized as a tribe by the Federal Government means the Shinnecock land is a sovereign nation unto itself it means the tribe can build as elaborate a casino as they would like regardless of New York State laws on gambling.  The Shinnecock fully intend to build a casino that not only has Class III slot machines, but table games like blackjack, roulette, poker, and craps.  The venue will also be equipped with a concert venue.

With such a project looming in the near future, the once very enticing Aqueducts venue has started to lose some of its luster.  All New York State can do is make empty promises that such a venue will pose little threat to the Aqueducts business.  Governor  Paterson assured bidders that “The state intends to protect its financial interest in existing and planned facilities.”

I am not sure what that means, but it seem like there is little the state can do to prevent the success of such a venue, other than expanding gambling in the states commercial venues.

New York State, never ceases to amaze its residents; and by amaze I obviously mean fail.  For a little less than a decade, there has been an effort to get slot machines operating at the Aqueducts racetrack in Queens.  The Aqueducts venue will operate 4,500 slot machines and is likely destined to become the most successful commercial gambling venue in the entire state, due to its close proximity to New York City.  However, one political goof up after another has let the track barren of slot machines and crumbling.  Finally, now that the state has serious recession related budget issues, it looks like the track will finally get an operator in line this year.

While this is great news, the federal government also formally recognized the Shinnecock Indians of Southampton, New York this month.  That federal recognition finally opens the door for the tribe to begin constructing a long desired casino venue.  If the tribe is constructs a casino venue in New York you better believe that it will be full casino style gambling.  The venue will have Class III slot machines and table games like roulette, craps, and poker.  There are a lot of high rollers in New York City and the surrounding areas that will flock to those table games.

The news completely takes the fire out of a Queens slots venue and diminishes its potential earning.  On a positive note, it might lead gambling expansion legislation.  Before long the racinos of New York State may adopt full gambling just to compete with their new found tribe.

Pennsylvania currently has one of the most successful slot machine programs in the United States and certainly on the east coast.  With just slot machines alone, Pennsylvania managed to take the legs out from under Atlantic City, New Jersey.  Atlantic City is known the world over for its casino resorts.  However, Pennsylvania and the economy really delivered a killing blow.  New York is currently in a position to create a real hit to both of those states.

At the moment slot machines are the only Las Vegas style gambling legal in the state of New York.  There are currently 8 racinos operating in the state.  The Empire City Casino is the closest to New York and therefore makes as much money as the seven other venues combined.  However, the Aqueducts racetrack will soon be operating casinos and since it is located in Queens, it will very quickly become the closest venue to New York City.

Pennsylvania recently added table games to their casino gaming offerings.  Neighboring states, Delaware and West Virginia, have also added table games.  With legal table games in New Jersey, Pennsylvania, West Virginia, and Delaware, many believe it is only a matter of time before New York’s gambling venues adopt table games.

Any operator that gets to operate table games and slot machines in Queens, New York is in a prime position to make serious profit.  Having access to the million of New Yorkers only a few train stops away will make for one of the most successful gambling markets on the east coast.

Getting slot machines operating at the Aqueducts racetrack should be the first priority for the New York legislature.  The state is dealing with serious budget issues.  Slot machines at Aqueducts will not solve all of their problems but it will certainly be a huge step in the right direction.

There are currently eight other racetrack casinos in the state.  They are all doing great business, but none of them are doing better than Empire City Casino in Yonkers.  The Empire City venue actually does as much business as the seven other racinos in the state.  Empire City Casino is also the closets casino to New York City.

Aqueducts is located in Queens.  It is one of the greatest opportunities in the eastern gambling market.  That is the reason it can draw such serious bidders.  Aqueducts, because of its proximity to New York City is expected to do about 50 percent more business than the Empire City Casino venue. Estimates predict that slot machines at the Aqueducts racetrack could generate as much a $800 million in annual revenues.  That would translate to about $1 million a day in tax revenues to the state.

“The prospect of operating that facility will keep a lot of people in the game,” said Michael J. Pollack.  Pollack is the managing director of the consulting group, Spectrum Gaming Group.

“It’s one of the few major opportunities left in the eastern U.S.”

New York was very quick to get the bidding process back online after the scandal earlier this year; a promising sign.

New York State is once again trying to lure in an operator so that they can finally install 4,500 slot machines at the Aqueduct racetrack.  This time around the bidders are companies of serious note.  There were several bidders, but only three eligible contenders remain.

The first company is Genting New York.  Genting New York is a subsidiary of the same Genting that happens to be the largest gambling company in Southeast Asia.  Southeast Asia has the fast growing casino market in the world.  Next on the plate is a partnership between two heavy hitters; SL Green and Hard Rock International.  SL Green made a name for itself as the biggest commercial landlord in all of New York.  Hard Rock International is one of the biggest casino operators in the world.  The final bidder is Penn National Gaming.  Penn Nation has become popular as a slot machines operator, but many of their venues have grown to offer full casino services.  They operate 15 casinos and many of them are in eastern states.  Penn National has successfully operated venues in Pennsylvania, Florida, New Jersey, and New York could be next.

I would like to think that this time the Aqueduct deal will go through.  The companies bidding for operation are certainly the right companies for the job and have proven themselves time and again at venues across the nation and across the world.  However, dirty New York politics have gotten in the way before, even at times when economic pressure was on.

After the disastrously failed attempt to get a company to operate slot machines at the Aqueduct racetrack in Queens, the city is courting bidders once again.  This will mark the fourth time in less than a decade that New York State has attempted to draw bidders to operate the casino venue.

There are pros and cons to the Aqueduct venue.  It is widely seen as a great venue to install slot machines.  The people of Queens have been waiting for the racino to start business for a long time because it carries several job opportunities with it.  Aqueduct is also located in an area where 2 million patrons could very easily access it through public transport.  It would also be the closest and most convenient casino to the New York City area.

However there are some draw backs.  There is the threat that a massive Las Vegas Style Indian casino will soon be built in nearby the track.  With casino style gambling in such close proximity, it will be very hard for Aqueducts to compete with only 4,500 slot machines. Many operators are also slightly put off by the idea of operating a racino.  Operators get far more bang for their buck when their casinos are not supporting an expensive and failing industry like horse racing.

This time around there are three serious bidders looking to run the racino.  There is a lot of pressure on New York officials to get this deal done.  The state has got serious budget issues and the slot machines could generate million for the state.