Sport of kings on wobbly legs; Sports betting races ahead in N.J., N.Y., flags in Pennsylvania

Were it not for racinos, we’d probably be talking about the sport of kings in the past tense. Handle at racetracks has fallen 50% in the last 15 years. However, slot machines have infused a billion dollars a year, keeping the horseracing industry on artificial respiration. Even with the spread of sports betting, particularly on mobile applications, the new era is “more likely to change the face of those businesses rather than revive them.” The situation is bad enough to have prompted a summit in Cleveland last weekend between track owners and lawmakers, trying to cure an ailing patient. “It’s going to require experimentation, reinventing the industry,” Spectrum Gaming Group‘s Douglas Reed offered somewhat unhelpfully. He offered e-sports as a possible draw to the ovals — but can you really see that happening? For all the talk of a “potential crossover,” video gamers make unlikely horse players.

The potential spread of sports books will take wagering to places where the tracks or not. However, calling that a solution presupposes a level of interest not manifest at the tracks themselves, which struggle to fill the stands. As Penn National Gaming‘s Christopher McErlean candidly admitted, “Unfortunately, those [slot] infusions of revenues haven’t necessarily increased the production or product of the racetrack.” Besides, if you can’t get the younger generation interested in slots, what’s the chance you’ll hook them on the even slower pace of horseracing?

One believer in horseracing is MGM National Harbor, which teamed with the Maryland Jockey Club to open an OTB parlor, part of a larger, $48 million expansion of the wildly successful casino. “We thought this is going really well, so let’s add space,” explained President Melonie Johnson. “We never anticipated the volume we’d have at this property.” Really? If MGM is surprised, things must be going even better than they look.

* While casinos in Atlantic City got off to a sluggish start in terms of readiness for sports betting, they’re compensating with a vengeance. The Division of Gaming Enforcement has received five applications (three of them for mobile) for sports books, the applicants as yet undisclosed. DGE Director David Rebuck said skeptically, “Everybody wants to be fully functional by the end of August. We’ll see.” Had casinos been on the ball (pun unintended) they wouldn’t be missing out on the NFL preseason and in danger of missing the start of the season proper. Known applicants for sports books are Harrah’s Resort and Bally’s Atlantic City, while all three Caesars Entertainment casinos are also seeking mobile-wagering licenses. The Golden Nugget has also filed a double-barreled request. Among the unlikely participants are two defunct horse tracks (funny how that keeps coming up): Garden State Park and Atlantic City Race Course. Better get a move on.

* Across the river in Pennsylvania, three casinos have opted in for Internet casinos, despite a formidable, 54% tax rate on ‘Net slots. The hardy threesome are Parx Casino, Mount Airy Casino Resort and in-progress Stadium Casino, each of which ponied up $10 million for the privilege. Given the low profitability of poker, some operators may let the deadline for bundled games pass and opt for either table games or slots, at $4 million apiece. No casino has plunked down the $10 million necessary to offer sports betting. (What if they gave sports betting and nobody came?) Casinos seem preoccupied with fighting the state lottery’s online games, which they contend are slots in everything but name.

* Palace Station rolls out its new Feast Buffet today. Modeled on the A.Y.C.E. Buffet at the Palms (All You Can Eat, geddit?), the new eatery is said to allow “guests to sample its reasonably sized stove pots and serving trays, individual plates and ramekins, carved-to-order proteins, as well as a series of made-to-order options.” Considering that the seven stations include vegan, vegetarian, and gluten-free options at “Healthy Favorite,” this isn’t Ye Olde Vegas buffet … especially if tofu is your thing (although the mushroom stroganoff sounds tempting). Mind you, Station Casinos isn’t straying wildly off the familiar path, yet it is offering something sufficiently different to merit making a special trip to West Sahara Ave.

* New casinos in New York State need all the help they can get, even if it’s purely speculative. That’s why — in the hopes that sports betting is legalized — Tioga Downs has contracted with FanDuel to operate its potential sports book and Del Lago Casino has done the same with DraftKings. Sports betting (taxed at 8.5%) has been lumbering through the Lege and is unlikely to be legalized until next year. Considering that New York is believed to be the second-largest market for it, lawmakers would be leaving megabucks on the table if sports wagers don’t become law. But strip the “integrity fee” from the bill, OK? In the meantime, sports betting could mean an entirely different type of SEC filing.

* Caesars Entertainment is playing hardball with itself. It’s selling Octavius Tower at Caesars Palace to Vici Properties for $507.5 million — contingent upon the successful sale/leaseback of Harrah’s Philadelphia. Caesars will get the tower for cheap, paying only $35 million in annual rent.

* Labor unions in Macao hoping to blunt worker-exclusion legislation aimed at curbing disordered gambling didn’t have their case helped by a report showing a sharp increase in exclusion requests. In the first half of this year alone, 233 exclusion requests were filed, compared to 376 in all of last year. Some operators, most notably Sociedade de Jogos de Macau‘s Angela Leong, have voiced misgivings about having to police their casino floors for employees from other properties. One possible upshot is making all entrants display I.D. At present, fines for violating exclusion begin at $124 at max out at 10 times that. Operators who are found to have excluded players on their floors are fined anywhere from $1,237 to $61,855. Ouch.