05/13/2014 1:26PM

Churchill Downs, Saratoga harness track partner on New York casino bid


Churchill Downs Inc. has joined a bid by the owners of a harness track and casino in Saratoga Springs, N.Y., to build a freestanding casino just outside of Albany, N.Y., the two companies announced Tuesday.

The partners will jointly bid on a casino license in East Greenbush, a suburb of the state capital. The owners of Saratoga Casino and Raceway had already filed an application fee with the New York State Gaming Commission for the license, one of four that New York plans to award in upstate regions late this year under a bill passed in 2013 authorizing up to eight new Las Vegas-style casinos in the state.

In a joint release, the two companies said the East Greenbush project would include a 300-room hotel, “multiple entertainment venues,” and various dining establishments, all de rigueur for a modern casino. The law passed by New York allows for the new facilities to operate the full array of casino games, in contrast to existing racetrack casinos, which are limited to slot machines. Nor are the casinos required to contribute any of their revenue to the racing industry, unlike the existing racetrack casinos.

The owners of Saratoga Raceway had initially attempted to build support for a casino license in Saratoga Springs, where its existing racetrack-casino is located. However, the city council passed a resolution stating that it would not support an expansion of the casino, citing the impact on local businesses. The owners then focused on the East Greenbush site.

The owners of Saratoga Raceway also have filed an application fee for a casino in Newburgh, south of Albany. Churchill is not a partner on that application. The state gambling commission received a total of 22 applications for the four casino licenses.

On Monday, the gambling commission passed a rule requiring a minimum investment of $135 million on any casino in the Albany region. The Saratoga-Churchill partnership said its project would cost $300 million. Bidding estimates for large projects requiring government approval frequently include costs of applications, legal expenses, marketing of the bid, and anticipated future costs.

The entry of Churchill into the bid is the first by the company to build a free-standing casino from the ground up. In addition to its five racetracks, Churchill operates slot-machine facilities at its Fair Grounds Race Course in New Orleans and at its Calder Race Course in Miami, and it also owns four casinos. All four of those casinos were existing operations purchased by the company.

Last year, the owners of Saratoga Raceway purchased a 30 percent interest in Ellis Park in Henderson, Ky., to enable Ellis to raise capital to build a parlor housing Instant Racing machines, slot-like devices that use the results of previously run races to generate random numbers determining payouts to bettors.