Finger Lakes track fears end to racing without deal

• Pressure on the state to protect jobs at Finger Lakes racetrack with del Lago casino opening Feb. 1.
• Farmington track fears new Seneca County casino will cut heavily into revenues.
• New casino hopes to 1,800 but is not required by the state to protect purses at nearby racetrack.

A $440 million Las Vegas-style casino is going to open Feb. 1 between Rochester and Syracuse with lots of glitter, the promise of 1,800 new jobs and renewed economic vitality for a region sorely in need of it.

Partly hidden by the growing hype is the casino's potential negative impact on the region's economy, most notably on Finger Lakes Gaming & Racetrack in Farmington, which believes it is competing for some of the same dollars and where 1,200 jobs are at stake.

Indeed, the situation is making racetrack workers, especially those who are only here for the season, so nervous that they are considering options to work at other racetracks out-of-state next year.

New York state leaders are aware of the situation and offered the 54-year-old racetrack in Ontario County a tax break last spring, but it may not be enough. Talks are ongoing to determine whether other solutions can be found to permit both businesses to coexist.

Some of those working at Finger Lakes Gaming & Racetrack claim that the new del Lago Resort & Casino in Tyre, Seneca County, will cut heavily into revenues, destroy purses and eventually cripple operations. Meanwhile, the casino has promised that in addition to hiring 1,800 workers it will pump tourism dollars throughout the Finger Lakes region after it opens.

"This casino down the road is going to take a lot of money from our purse account," said David Brown, president of the Finger Lakes Horsemen’s Benevolent and Protective Association. "We can't compete. There is no way."

The union representing 120 trainers at the track said revenues could be cut up to 50 percent when del Lago opens less than 30 miles east on the Thruway, Interstate 90.

New casino deals some lives a new hand

A report by Moody's Investors Service released earlier this year said the casino would "cannibalize" existing competitors. The American Gaming Association has also reported that existing casinos have seen losses when new venues are allowed to open nearby. Not surprisingly, those at del Lago see things differently.

"Finger Lakes has had a monopoly in the region for the last two-plus decades," said del Lago spokesman Steven Greenberg. "They had the opportunity to apply to get a casino license. They chose not to."

Competition runs both ways, he said, while also noting that other locations, such as Saratoga, are doing well with horse racing. Greenberg is quick to promote efforts to connect with businesses throughout the region, with theaters, recreational areas and other attractions.

"Seneca County has never once in the last two decades benefitted a penny from Finger Lakes, from Turning Stone, from any other gaming facility in upstate New York," he said, whereas now, by law, the town of Tyre and other towns in the region will.

Tribal casino operators and others mounting legal action have unsuccessfully tried to stop del Lago, a project led by Thomas C. Wilmot, the chairman of Rochester-area development company Wilmorite Inc.

The hit would further cut into thoroughbred racing at the track and a roughly $18 million total annual purse, Brown said. Some of the 1,200 workers at the racetrack would likely lose their jobs. Area farmers and small businesses supporting the track would also take a hit, he said.

Because of the uncertainty, Troy Smith, a trainer from Arizona, said he doesn't know whether he'll return when racing resumes in the spring at the Finger Lakes racetrack.

"If this place gets in trouble and goes to funk, (it) will be a ghost town around here in a hurry," said Smith, the third generation of his family to work at the horse track. His mother, Violet, was one of the first and most successful female jockeys ever to race at Finger Lakes. "It's hard to fathom (but if) the well runs dry, there is no horse racing. I've seen it and I've seen it at more than one place."

The horsemen’s association launched a campaign earlier this year to convince the state Legislature and Gov. Andrew Cuomo to guarantee the track's purse and protect jobs when the casino opens.

During a recent stop in Rochester, Gov. Andrew Cuomo said the state's Gaming Commission is working to address the issue.

"I understand the issue and we are working on it. I'm sure we'll announce a resolution. I don't know the timing," he said. "I'm not crazy about casinos, frankly. We're desperate for the creation of jobs in upstate New York and these casinos are going to do just that."

This past summer, pushing back against a possible slot parlor in downtown Rochester, del Lago owner Thomas Wilmot and other casino operators pledged 400 jobs, from a combination of del Lago, Finger Lakes Gaming and Western Regional Off-Track Betting in Batavia, along with free transportation — perhaps by bus — to city residents. Asked about that commitment, Greenberg said del Lago was "aggressively hiring in the Rochester area" but at the moment, had no plans for busing. Similarly, Regional Transit Service spokesman Tom Brede said, "While conversations are ongoing, there is no plan in place."

THE SLOW DOWN

Racing already has been cut back at Finger Lakes in recent years, Brown said. Purses have declined by 12 percent and several days of racing were already cut, Brown said. The latest season closed Nov. 30.

"Owners now can’t afford to keep horses here because the purses are so low," Brown said. "I am going to lose a race track here in the next two years and then it’s not going to be recoverable anymore."

Visitors to the track can get up close to many of the trainers, jockeys and their horses. Most don’t see how the roughly 1,150 horses are cared for in an area a short car ride from the track’s betting counters.

It's where the horses are washed, brushed and rubbed down after races. They are fed and housed in long barracks of stables. Some of the workers live in separate but nearby quarters.

Mechanical devices that look like metal spiders and trainers on site help keep the animals in shape. There's even a swimming pool for the horses. They get to run on an adjacent practice track.

Finger Lakes Gaming & Racetrack is a 450-acre property that does about $128 million in annual revenues, said Chris Riegle, president and general manager of the venue. Nearly 70 percent of those revenues go to the state in the form of taxes; another 10 percent go for the purses at the track.

Cutting into those revenues would prevent the track from operating nine races a day for 155 days next season, he said.

"The season is definitely in jeopardy," Riegle said. "We can't open the season without some sort of clarity about what we are going to be doing with the purses. It can't happen. People are listening. It is a lot of jobs. It's a big economic engine for the area, for agriculture. It just needs to corrected. Now is the time to deal with it."

While Finger Lakes has video gaming terminals and horse racing, many said the draw of table games, a 2,400-seat auditorium and other features at del Lago would put extreme pressure on Finger Lakes.

John Buckley, 59, of Farmington, said the casino already has hurt Finger Lakes.

"Everything has slowed down a little bit over the last four or five months because they don’t know what our future is going to be here," said Buckley, a trainer who grew up in the area. "It has kind of thrown the brakes on everything."

RISE OF CASINOS

Casino revenues across the state increased nearly 2.8 percent to about $1.95 billion last year, according to the American Gaming Association.

Roughly 4,800 people worked in the industry with approximately $888 million generated in tax revenues, according to a report earlier this year from the association.

Those numbers are expected to increase after del Lago, Rivers Casino and Resort in Schenectady County and Montreign Resort Casino in Sullivan County open in early 2017.

A fourth venue, Tioga Down Casino in Tioga County, opened Dec. 2 with 33 new table games, 1,000 new slot machines and plans to add nearly 810 new jobs. The venue had already offered harness racing.

The gaming association said as more states like New York allow full-fledged casinos, existing operators in nearby states have seen an "obvious influence."

For example, casinos in New Jersey saw a 6.5 percent drop in revenues to nearly $2.6 billion and West Virginia had a 4.9 percent decline, to $687 million last year.

In Seneca County, construction crews have been working to meet deadlines on the $440 million del Lago project. The casino is scheduled to open in February. A hotel, spa and other venues will come online later in the year.

It has been heavily recruiting and training table dealers, with hundreds still needed to be hired by opening day.

About 110 people have completed a six-week dealer’s school and 190 others had signed up for a second session that started on Nov. 28.

Overall, Lago's owners expect 1,500 to work at the casino and another 300 in the hotel.

Zack Carlson, 20, and his dad, David, 46, both of Greece, drove about an hour a day to train to work the tables at del Lago. Both came to the casino looking for regular hours and better pay from seasonal contracting work.

"It does take a pretty big toll on my body, waking up in the morning, back aching from the day before, find dust all over your body even after a shower," Zack Carlson said. "I would be making more money so I would not be living paycheck to paycheck, struggling every week to buy groceries and fill my tank with gas."

The average pay for dealers with tips is about $17.50 an hour, according to del Lago.

In its first year, the casino projects it will bring about 3.2 million guests to Tyre, Seneca County, a town of about 1,000 people just off Thruway Exit 41, said Jeff Babinski, general manager of del Lago.

The casino is expected to pull in guests from Monroe County and other areas. It is targeting as customers those looking to cut down on drive times to other casinos, and those uninterested in the video gaming terminals at Finger Lakes and Batavia Downs Gaming.

"Why can't we all survive in this region?" Babinski said. "They will continue to go to Finger Lakes and the other casinos or restaurants or business that are in the area. We want to be great corporate citizens, great corporate neighbors but more importantly we are here for the long haul.

"The casino is perfect for what this region needs."

FEELING EXPOSED

Realizing how steep losses could be for Finger Lakes when the casino opens, state leaders approved a tax break last spring for Delaware North, the Buffalo-based food service and hospitality company that operates the racetrack and several other businesses.

"The tax credit is going to be about a 10 percent difference," said Riegle. "It's not large enough to ... maintain the gaming operations and also support the racing. It isn't enough money to cover both problems."

The racetrack isn't the only business projecting losses. Moody’s has projected del Lago would draw customers from Finger Lakes, Batavia Downs and Turning Stone in Verona, Oneida County. Operators of those three have been unsuccessful in various ways, including legal action, in stopping the casino from being built in Seneca County.

Another issue stems from a 2013 law that allowed new casinos to be built. It put the Finger Lakes track outside of a zone that would have forced del Lago to guarantee purses at the track.

The horsemen's association has asked state lawmakers to extend del Lago’s responsibilities.

Delaware North, which says it could face a $14 million loss next year, has made no firm commitments to maintain purses at the current level, Brown said.

Losses, he added, wouldn’t just hurt the track but would expose area farmers supplying feed and materials and area businesses relying on workers and visitors to spend money in their stores and restaurants. He said roughly $4 million would be needed to protect purses next year.

"We will struggle to get through next year," Brown said.

Del Lago points to its own player's card that will help offset some of the adverse impact to local businesses. Points earned on the card can be used at other venues throughout the region, Babinski said.

State assemblymen Joseph Morrelle, D-Irondequoit, and Brian Kolb, R-Canandaigua, said they've been working on the issue with other state leaders. Morrelle said he hoped for a solution by the end of the year.

"We clearly understand the urgency here," he said. "We just need to figure out how to make sure that the solutions we craft, both short-term and long-term, are equitable. If we made a deal and an announcement before the end of the year — even if we didn’t ratify it — the practical impact would be that it would hold folks in place and they would know that there is a resolution to the problem."

Kolb said the racetrack is a significant contributor to the area's economy and the state's horseracing industry.

"As the opening of the new casino approaches, it is imperative that we find a balance where del Lago can thrive and we avoid any negative impacts to the racetrack and its horsemen," Kolb said in a statement.

Lawmakers said they are discussing a series of options, including state aid and having Finger Lakes and Lago help ensure the horsemen do not take a financial hit.

The issue gained added attention after Finger Lakes received the tax break in April, yet the agreement didn't include any help for the horsemen — whose payments expect to drop when Lago opens because they get a percentage of Finger Lakes' revenue.

"What we are trying to find is a solution where all the stakeholders have a part of the solution," Kolb said.

Nevertheless, after racing at Finger Lakes ended on Nov. 30, many trainers and owners began looking at tracks in Pennsylvania, Ohio, California, Florida and elsewhere for the 2017 season.

And for Troy Smith, who grew up watching his mother race thoroughbreds at Finger Lakes, it might mean leaving for good.

"This is part of a family here," he said. "If this place goes, it is going to hurt."

TCLAUSEN@Gannett.com

Includes reporting by Brian Sharp, staff writer, and Joseph Spector, chief of USA TODAY Network's Albany Bureau.

DEL LAGO RESORT & CASINO

85

Gaming tables

2,000

Slot machines

1,800

Jobs

$440 million

Building project

Finger Lakes Gaming & Racetrack

44,000

Square feet of gaming space

1,150

Horses cared for at the site

440

Acre site, including practice facility and stables

$128 million

Estimated annual revenue