09/21/2009 11:00PM

Ohio racino plan full of ups, downs

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TUCSON, Ariz. - If you like roller coasters, you'll love what's going on in Ohio.

Gov. Ted Strickland stopped racing from getting slots a year or so ago. Then, faced with a budget crisis this summer, he reversed his field and by executive fiat announced that he was awarding 2,500 slots to each of Ohio's seven tracks - four harness and Thistledown, Beulah Park, and River Downs - and lowering the legal age for gambling from 21 to 18.

The latter move drew public criticism, and last week the governor again reversed his field, saying he was changing the age back to 21.

While this was going on, due day arrived for the tracks last Tuesday, when they were to pony up $13 million as the first down payment on the $65 million each had to pay for a license, plus a nonrefundable $100,000 to file their application.

Only two of the seven tracks - the harness operations at Northfield Park just outside Cleveland and Toledo Raceway, owned by Penn National Gaming - came up with the $13 million.

The others presumably were trying to get financing, and Strickland said he understood that and hinted that he might amend or soften the requirements. His earlier order also provided for an extension in the first installment, but it would cost an extra $2 million, bringing the license fee to $67 million for tracks availing themselves of the delay.

When the deadline arrived, Thistledown, up the road a few miles from its harness neighbor Northfield, was being sold at auction in connection with the Magna Entertainment Corp. bankruptcy. Brock Milstein, the wealthy young chairman of Northfield, reportedly was interested in buying Thistledown. But when the bidding ended, there were only two candidates, and Milstein was not one of them. The bidders were Harrah's Entertainment and the omnipresent Penn National. Harrah's got the track, which it clearly sought with the promise of slots on the way.

Then, on Monday of this week, the Ohio Supreme Court ruled, in a 6-1 decision, that the issue of slots at tracks in Ohio required a statewide referendum.

The governor had argued, in mandating his idea, that since the slots were an integral part of the budget process, they were not subject to a referendum.

It does not appear that there is any way a petition for the slots-at-tracks proposal can get on this year's November ballot. However, voters will decide a referendum this November on a proposal to add casinos - but not racinos - in Cleveland, Columbus, Cincinnati, and Toledo.

Ohioans have been down this road four times and rejected casinos on each occasion. The skinny in Ohio now is that polls show the casinos are lagging in support again, but that the slots-at-tracks plan is doing well. Except - and it is a big except - if the four-city casino plan goes down in November, or even if it wins, the slots-at-tracks proposal will face very tough sledding next May, its earliest possible date for a referendum after November. However, the May election is a primary, and the tracks may prefer to wait for the general election in November 2010.

Strickland said last week, after the five missed $13 million payments, that "I am not concerned or worried that there will not be compliance. I feel rather good about the fact that at this point there's been good faith efforts to comply and meet their obligations."

But that was before the state Supreme Court changed the game, and possibly the face of Ohio racing, by requiring a public vote.

It was interesting that the Supreme Court justices, in announcing their decision, made clear they understood the consequences of their action. In their majority decision, they said, "We are not unmindful of the effect our decision may have on the state budget, nor of the commendable efforts of the members of the executive and legislative branches of state government to fulfill their constitutional duties to balance the budget in Ohio. However, our own constitutional duty is to ensure compliance with the requirements of the Ohio constitution irrespective of their effect on the state's current financial conditions."

The lone dissenter in the court's decision, Justice Paul E. Pfeiffer, thought otherwise. He wrote that the slots provisions in the budget bill are appropriate for expenses of state government and aren't required to go before voters.

After reading all this, consider how easy it is to win a pick six or pick eight, when compared to running a racetrack in Ohio.