2005 - Harness Tracks of America, Inc.

HARNESS TRACKS OF AMERICAExecutive NewsletterA daily fax and e-mail report on racing and gaming developments in North America and beyondStanley F. Bergstein, Editor January 28, 2005BIG PLANS FOR POCONO TRACKPOWER JOINS GURALRobert Soper, the youthful new president and TrackPower, Inc., and its CEO John Simmonds,CEO of Pocono Downs, lost no time in telling of partners with Jeff Gural in reopening Tiogathe Mohegan Tribal Gaming Authority’s ambitiousplans for the track after the group closed announced that the company will be entering intoDowns in Nichols, NY, near Binghamton, haveon its $280 million acquisition of the track and a joint venture with Gural in his pursuit ofits five OTB parlors from Penn National Gaming.Soper said the Mohegans expect to spend of Vernon Downs, accepted an offer two weeksVernon Downs. Mid-State Raceway, the parent$175 million on new construction, furnishings and ago from Gural to contribute $5.4 million on anequipment for the track and its racino, in additionto the $50 million upfront fee on receipt of the TrackPower announcement says that on con-interim basis for continuation of operations, andthe gaming license. Although the designs are not firmation of Vernon Downs’ Chapter 11 plan, theyet complete, Soper said they will include a racino loans will be converted to 80% of the issued publiclytraded common stock of the reorganizedfor between 1,500 and 3,000 machines initially,along with some restaurant and retail facilities debtor. It says that if approved by the BankruptcyCourt, TrackPower and Gural will eachand a small entertainment area.hold one-half of the 80% interest acquired onconfirmation and each will contribute one-halfof the funding required.In a related and bizarre development,Pennsylvania’s gaming law provision for challengingthe sales price of tracks has been mentionedin press reports. Aside from the dangerousprecedent of dictating the sale price of privateproperty, what the Mohegans paid forPocono has no relationship to the $47 million thatPenn National paid for the track nine years ago.Slots were a far-off and far-from-certain dreamat the time, and the present price also has littleor no relationship to the $53 million that MagnaEntertainment paid for The Meadows in 2001,also long before anyone knew whether Pennsylvaniawould pass a racino law. In typical pressfashion, the Philadelphia Inquirer appeared to bemaking an issue of the price provision, but expertsin the field made light of the non-issue. TheInquirer’s John Sullivan, who wrote the story, didquote William Thompson, a professor of publicadministration at the University of Nevada-LasVegas, who said of the pricing question, “Thereis no sense to that. It’s rent control. We have amarketplace that tells us what the valueof something is.” He’s right, and thegaming commission should make shortwork of dismissing the matter.BALA CATCHES MORE HEATLeonard (Lenny) Del Genio, a Las Vegas handicapperwho worked for Susan Bala for five years,testified yesterday at Ms. Bala’s federal trial onillegal gambling charges that “she knew everythingthat happened” at Racing Services, saying“Nothing ever was ordered without Susan’s fullauthority and permission.” His testimony contradictedthe defense argument that she wasn’taware that $99 million in bets were going unreportedand untaxed at her Fargo operation.TIME RUNNING OUT FOR ROOMSA high-powered agenda for the upcoming HTA/TRA meeting will be announced early next week,and if you plan to hear it and take part in it andhave not yet made hotel reservations with CindyKnox at the HTA office, you had better do so.HTA’s room block expires the end of next weekfor the March 8-12 meeting at the Hyatt GrandChampions resort in Indian Wells, California.