Exposing the Forest County Potawatomi's multimillion-dollar crusade to squash competition and wrangle a government-backed monopoly for its Milwaukee casino
Potawatomi Bingo Casino is laying the groundwork to expand its gambling menu to include pari-mutuel betting on horse and dog races conducted at tracks around the country.
Ken Walsh, spokesman for the Forest County Potawatomi, confirmed Monday that casino officials have been negotiating with out-of-state tracks to simulcast their races and take bets on them at the Menomonee Valley casino. The Oneida casino near Green Bay and the Ho-Chunk casino near Baraboo already offer off-track betting.
"It's allowed in the compact, and the customers have been asking for it," Walsh said, adding that off-track betting could begin this year when the casino completes its $240 million expansion.
The addition of simulcasting by the Potawatomi could be a blow to the financially struggling Dairyland Greyhound Park, which employs about 200 people. About 70% of the Kenosha track's annual handle - the total amount wagered - comes from bets placed on simulcast races.
"We're not in the business of being in the casino industry," said Roy Berger, Dairyland executive vice president. "Where on earth do they come off taking what little sliver of the market we have left?"
The Dairyland handle last year was $53.7 million, with $38.9 million of those bets placed on races run at more than 50 horse, harness and dog tracks. The 2006 handle was $57.9 million with $40.6 million bet on simulcast races. The track keeps about 5 cents of every dollar wagered on a simulcast race and 10 cents of each dollar bet on dog races run in Kenosha, said Berger. That revenue is used to pay costs of running the track, which opened in 1990.
The track lost $2.8 million in 2006, the latest figures available. Another loss is expected for 2007.
The betting handle at Dairyland likely would fall if Potawatomi accepts bets on races run at the same out-of-state tracks."They say you don't pass a casino to get to another casino," Berger said. "I'm sure you don't pass a simulcast to get to a different simulcast."
Track vs. tribe
The Potawatomi have been hugely successful, winning more than $350 million a year from gamblers.
"This comes at a time when, indeed, the Potawatomi is sitting on top of the mountain," Berger said, noting that the pari-mutuel gambling business is declining. "I don't know why anybody would want to get into this thing - unless it's to be vindictive."
Berger said attempts by Dairyland - the state's only dog track - to offer slot machines to compete with Indian casinos have been rejected, while the state gave tribes the go-ahead to compete with Dairyland.
In 2003, when the state agreed to allow the Potawatomi and other tribes to offer off-track betting, Potawatomi officials assured Marc Marotta, then state administration secretary, that they would not offer simulcasting as long as Dairyland stayed in business. Marotta said that the tribe wanted the authority to offer simulcasting in the event that the track closed.Walsh said the situation in 2003 was different from that of today. For one thing, he said, the original compact gave the tribe exclusive rights to offer casino games within 50 miles - a provision that was later eliminated by the federal government. Besides, Walsh said, Dairyland has not been a friend to Indian casinos, having unsuccessfully challenged the legality of them in court.
"A lot of things have happened since then, including Dairyland's efforts to end Indian gaming - continued efforts," Walsh said.
Dairyland hopes to sell its facility to the Menominee tribe, which would turn it into an $808 million mega-casino complex. That application is pending at the U.S. Department of Interior. Interior Secretary Dirk Kempthorne has never been a fan of off-reservation casinos, and on Friday his agency killed 11 such applications. The Menominee application is still pending with the agency, and the Potawatomi have been lobbying to get the deal rejected.
If the Potawatomi offered off-track betting, Berger said, it would not force the dog track to close. Rather, he said the track would consider adding services such as an entertainment complex.
Potawatomi eyes adding pari-mutuel betting lounge
Race simulcasts could negatively affect Dairyland’s business
BY JOE POTENTE jpotente@kenoshanews.com DairylandGreyhoundPark, long floundering in the face of competition from gambling casinos, is expected to soon face a new challenge.
The Forest County Potawatomi Tribe is eyeing adding a parimutuel betting lounge to its Milwaukee casino and bingo hall, a tribal spokesman confirmed Monday.
This would likely allow bettors at the casino to wager on many of the same out-of-town horse racing simulcasts from which Dairyland derives a significant share of its waning business.
“Obviously, it’s going to make it extremely challenging, especially when you consider about 65 to 75 percent of our business is now in simulcast,” said Roy Berger, Dairyland executive vice president. “But the bottom line now is why are they doing this? They have absolutely no right to get into this.”
Potawatomi spokesman Ken Walsh said the ability to offer race simulcasting is included in the tribe’s casino compact with the state. Also, he said, customer demand is calling for it.
“First of all, the tribe is in the middle of a $240 million investment in its facility,” Walsh said. “So once that facility opens — which will be later this year — there are plans to have an offtrack wagering facility in the newly expanded casino.”
Walsh said the Potawatomi remain in contract negotiations with various racing venues.
Berger has long said Dairyland is struggling as it awaits the possibility of selling out to a tribal gambling interest.
The Menominee Nation continues to hold a $40.5 million purchase option on the track, which the tribe would exercise if the federal and state governments sign off on plans to develop an $808 million casino complex there. The tribe is continuing to await a determination from the U.S. Bureau of Indian Affairs.
In its most recent filings with the state, Dairyland projected it would lose $2.07 million in 2007 and $2.48 million this year, following losses of $2.85 million in 2006 and $2.42 million in 2005.
The 18-year-old track has blamed its steady decline on the emergence of tribal casinos in Wisconsin in the 1990s.
For several years, Dairyland pursued a lawsuit against the state, arguing that the tribal casinos were unconstitutional. But a July 2006 Wisconsin Supreme Court decision ruled that the casinos are within the bounds of a 1993 constitutional amendment that set the parameters for legal gambling activities in the state.
Walsh noted that off-track wagering is now a part of tribal casinos elsewhere in Wisconsin.
“Ho Chunk has a facility, as do the Oneida,” he said.
The debate marks the latest chapter in a budding feud between the Potawatomi and Kenosha gambling interests.
Since 2004, the Potawatomi have spent millions fighting the Kenosha casino, the tribe says, largely because of the involvement of the out-of-state Mohegan Tribe, the Menominee Nation’s Connecticut-based partner. Kenosha casino backers, in turn, say the Potawatomi are merely trying to protect a southeastern Wisconsin casino monopoly.
Now, Berger said he believes the Potawatomi off-track betting proposal is out of line.
“I think in this case, clearly, they’re stepping into a territory they shouldn’t be in,” he said.
