11/18/2003 12:00AM

Let's make a deal, racino style

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TUCSON, Ariz. - The Battle of New Mexico will end this week after two years of bitter fighting.

It has been the most savage contest in the Land of Enchantment since July 1878, when Billy the Kid and the McSween Crowd shot it out with a sheriff's party that included 15 paid gunslingers. The sheriff won, burning down McSween's house after a three-day standoff, but Billy the Kid escaped.

That battle was about revenge killings. The current one is for the town of Hobbs, or at least for a racino license there, on the barren New Mexico-Texas border. It is isolated and dusty, but it also is within shooting distance of the busy West Texas towns of Odessa, Midland, and Lubbock. There is oil there, and for a racetrack with slots, there also is gold.

For people in West Texas, 50 or 75 miles is a straight shot to the supermarket.

As a result, four formidable rivals have been battling to build in Hobbs. Three of them have clout with the governor of New Mexico, Bill Richardson. All of them have money. All of them want more. Three of the four are well known to those in horse racing.

One is R.D. Hubbard, owner of Ruidoso Downs in New Mexico, formerly of Hollywood Park and the Woodlands in Kansas City, and part of an embarrassing association with a casino in Indiana, where he had to give up his license. He is the favorite as the field heads toward the finish line and a decision this week by a racing commission that has agonized over the license applications, so much so that it ultimately hired outside evaluators to try to separate the candidates.

A second applicant is Ken Newton, a former educator and former owner of Santa Fe Downs. Like Hubbard, he is an experienced track operator and one of the most articulate men in American racing.

The third contender is Gerald Peters, a wealthy art dealer in Santa Fe who wants to expand his holdings into the racetrack and casino business.

And then there is Shawn Scott, of Las Vegas and points west, who bought Delta Downs in Louisiana for $10 million, helped gets slots at tracks there, and then sold it two years later to Boyd Gaming for $130 million or so. Scott currently also is gearing up to open a racino at Vernon Downs, a harness track between Syracuse and Utica, N.Y., which he now controls. More recently, he is the man who sold the racino version of the Brooklyn Bridge to the trusting burghers of Bangor, Maine.

His company will get 75 percent of the revenue from slots and pay Bangor out of that, with 7 percent in purses paid out of the state's 25 percent share. By comparison, Woodbine in Toronto, the biggest racino in North America, gets 10 percent, with another 10 percent designated for purses. West Virginia racinos get 47 percent, with another 14 or 15 percent paid to purses; Delaware tracks get 49 percent with 11 percent additional to purses; Iowa's Prairie Meadows got 39 percent originally, with another 12 percent to purses; and New York tracks, when their racinos finally open after much fussing and fiddling around, will get 25 percent, with 6.25 percent coming out of that share for purses, for a net 18.75 percent to the tracks.

Although the citizens of Bangor voted for a racino at their little track, those in the Maine town of Scarborough did not, leaving that town's harness track, Scarborough Downs, without slots. Sharon Terry, who wound up owning that track when her partner, Joe Ricci, died at an early age, was angry. She asked the city council of Saco, which adjoins Scarborough, to hold a referendum to legalize slots in that town, and said she would close her racetrack in Scarborough and build a new one down the road a mile or two, just across the Scarborough town line. That decision, like the one in New Mexico, is up for vote this week.

Guess who quickly offered to be Ms. Terry's new partner in Saco? You got it. Shawn Scott. Ms. Terry declined with thanks.

Back in New Mexico, the Scott presentation before the racing commission last week promised the usual fancy trappings of new racinos - a glitzy casino, plus a few more: a water park, movie theaters, and basketball courts.

Oh, and one more: bikini-clad waitresses serving liquor to the casino patrons. ESPN Horse Racing jumped on that, using an Associated Press story that pointed out that New Mexico law forbids the serving or consumption of liquor on the gaming floor of casinos, by waitresses in bikinis, hoopskirts, or whatever. ESPN headlined the story "Scott stumbles during Hobbs presentation."

So charging down the stretch this week toward the oil and gold of West Texas, the best-bet quinella is Hubbard and Newton. You will know the exacta shortly after reading this.