Heading into Thursday’s official and long awaited groundbreaking for the Hollywood Slots at Mahoning Valley Race Course in Austintown, a trifecta of developments are converging to build a solid foundation for the $125 million project.
Those developments include a revived and growing horse industry in Ohio, a strong local authority to oversee financing of racino construction and the real promise of thousands of new jobs the complex will create. Collectively, they yield unbridled optimism toward a successful opening and a long run for the racetrack and casino at Interstate 80 and state Route 46.
AT THE STARTING GATE FOR GROWTH
First, the timing of construction aligns well with a resurgence in the horse industry in the Buckeye State. Clearly, there should be no shortage of the thoroughbred racetrack’s key resource: horses.
In 2012, 1,650 Ohio mares were bred to Ohio stallions, more than double the 2011 figure, according to the United States Trotting Association. The number of thoroughbred mares registered in Ohio also grew by 54 percent from 2011 to 2012 after years of substantial decline.
Also on the rise are purses at Ohio racetracks. Purses totaled $1.92 million in 2012 and are projected to reach about $3 million this year. In April, opening day purses at the new Thistledown racino near Cleveland jumped 65 percent compared with those of last year.
Tracks around the state also report ballooning attendance this year. Clearly, the introduction of legalized gambling at the racetracks has reinvigorated harness and thoroughbred racing throughout Ohio, and the Hollywood in Austintown can surely capitalize on that momentum
As Robert Schmitz, chairman of the Ohio Racing Commission, puts it, “We’re just seeing a glimmer of the future. It’s bright.”
LOCAL CONTROL OVER FINANCING
Another bright spot in the Valley racino’s project came to light last week, when the Western Reserve Port Authority, the public body that oversees the Youngstown-Warren Regional Airport and economic development projects throughout the Valley, acted to become a major player in financing construction of a major portion of the complex. The WRPA board agreed to fund construction of the track, horse stables, parking lots and other buildings planned for the racetrack and then lease those assets back to the racetrack’s owner, Penn National Gaming.
By a 7-0 vote, the port authority on Wednesday approved the $60 million capital lease deal with Penn National, a respected leader in the gaming industry with 29 facilities in the U.S. that feature approximately 36,800 gaming machines, 850 table games, 2,900 hotel rooms and 1.6 million square feet of gaming floor space.
Penn National spokesman Bob Tenenbaum called the plan a “good business decision.”
“We are very pleased at the opportunity to work with the Western Reserve Port Authority,” he said. “It works well for us, and we like the idea of being able to work through a local organization for part of the financing.”
That deal also bodes well for the port authority. Not only does it provide our community with a strong local partnership with Penn National and some degree of control over the racino’s construction, it also allows WRPA the opportunity to prove itself as a capable major-league player to attract other development projects for our economically rebounding region.
“This project is a win-win-win,” remarked Scott Lynn, port authority chairman, in a news release distributed after the board’s meeting last Wednesday. “It will provide a capital lease financing structure for Penn National. It showcases the Port Authority’s ability to offer unique financing options that will spur economic growth in the region, and it will create thousands of direct and indirect jobs.”
A BONANZA OF NEW JOBS
The potential long-term economic payoff of this project to the Valley is substantial. In addition to the 1,000 construction jobs needed over the next year and the approximate 1,000 permanent jobs Hollywood Slots will create, Austintown Township and the Valley benefit through a variety of positive ripple effects
The township is ready to receive fees from the license transfer to prepare the area with additional safety and fire personnel. Austintown stands to garner $1 million for the first and second year of the license relocation from Beulah Park near Columbus.
The racino also will spur other development, including hotels and restaurants in the bustling I-80 interchange area. Township trustee Jim Davis expects a busy year ahead for private developers hoping to capitalize on the influx of visitors to the township. Considering that an estimated 1 million people are expected to visit the racino yearly and spend about $100 per trip, such expectations are not unreasonable.
The next 12 months, however, will be critical toward reaping those riches. The project has had a long and bumpy history over the past two years. Now that all of the critical pieces are in place and groundbreaking is but five days away, we’re betting on the WRPA and Penn National to work quickly, diligently and responsibly in guiding the Hollywood Slots at Mahoning Valley Race Course to success at the finish line by summer 2014.