04/07/2015 1:31PM

Colonial Downs shutters its ADW


Colonial Downs in New Kent, Va., on Tuesday abruptly shuttered its sole wagering business in the state, an account-wagering operation, in protest of horsemen’s support for an amendment to legislation designed to pave the way for live racing in Virginia to resume.

The decision to close the account-wagering operation, EZ Horseplay, makes good on a threat by Colonial to cease all betting operations in Virginia if the track did not reach an agreement with horsemen and breeders’ organizations on a lease of its properties by April 1. Though EZ Horseplay was shuttered immediately on Tuesday, most major national account-wagering companies still operate in the state.

In a statement released Tuesday, Jeff Jacobs, the chief executive of the company that owns Colonial, said the company decided to shutter EZ Horseplay because of the horsemen’s support for an amendment to legislation that would direct escrowed 2014 revenue to horsemen in the event that Colonial does not hold its own race meet this year. The revenue had accrued from account-wagering bets made in the state throughout last year, when Colonial did not run a race meet.

The dispute between horsemen and Colonial dates to early last year, when Colonial said it would seek to run an abbreviated race meet in 2014. Horsemen resisted, favoring a longer meet, and by the end of the year, the track had canceled its 2014 race meet, surrendered its racing license, and closed all of its offtrack betting parlors.

However, earlier this year, Colonial and the state’s horsemen’s groups united behind a push for legislation that would reallocate some account-wagering revenue from national betting companies so that the track and horsemen would get a larger share, paving the way for the resumption of live racing in 2015. The state’s House and Senate passed the bill in March, sending it to Gov. Terry McAuliffe for his approval or veto.

But soon after the bill was passed, the alliance between track and horsemen began to fray when Colonial announced it was no longer interested in operating the track. Instead, Colonial told horsemen that it was open to negotiating a lease of its racing assets, including its offtrack betting parlors and account-wagering company, to the state’s Thoroughbred and Standardbred interests, according to Frank Petramalo Jr., the executive director of the Virginia Horsemen’s Benevolent and Protective Association. Those negotiations failed, Petramalo said.

In response, horsemen requested that McAuliffe add an amendment to the existing legislation that would direct the escrowed revenue from 2014 to the horsemen if Colonial did not run a meet in 2015. That would allow the horsemen to fund race meets at alternate locations, Petramalo said. McAuliffe agreed to add the amendment.

The House and Senate are scheduled to meet April 15 to consider the amended horse-racing bill, along with other bills sent back to the legislature by McAuliffe.