ATLANTIC CITY — New Jersey’s horseracing tracks and the Atlantic City casinos have had a bitter rivalry for years.
The financially troubled tracks have been losing customers to the casinos. The casinos, meanwhile, have grown tired of paying millions of dollars in subsidies to the racing industry to prevent the tracks from getting slot machines.
“We’ve all had our selfish best interests at heart,” said Bob Kulina, vice president of thoroughbred racing at Monmouth Park Racetrack. “We didn’t care. We all looked to run our own businesses.”
But now, Monmouth Park and Resorts Casino Hotel have begun cooperating with each other under a new marketing partnership that is expected to generate extra business for both facilities.
New York real estate magnate Morris Bailey is being credited for bringing the track and casino together. Bailey is the co-owner of Resorts and has just taken over the operation of Monmouth Park in Oceanport as part of a five-year lease with the New Jersey Sports and Exposition Authority.
“He’s creating a new paradigm for horseracing, the track and the casino,” Dennis Gomes, Resorts’ chief executive officer, said of Bailey.
The partnership is just getting out of the starting gate, but Resorts has already agreed to sponsor Monmouth Park’s premier race, the $1 million Haskell Invitational. Now called the Resorts Haskell Invitational, the race’s nationally televised broadcast Sunday on ABC is expected to generate tons of publicity for Resorts and Atlantic City.
“The Resorts name will be broadcast across the country,” Kulina said. “I think it’s a big deal. I think it’s an opportunity for Atlantic City to market itself to a national audience. I also think it’s a great branding opportunity for Resorts and the track because we will share the same customers.”
Resorts and Monmouth Park are exploring other marketing deals to drive business to each other, including offering racing fans hotel and restaurant packages at the casino. Kulina said Resorts’ high rollers will be brought to the track to enjoy the racing. Another possibility is having big-name entertainers who are booked at Resorts also make appearances at Monmouth.
“I think it’s just about bringing people to both facilities,” Kulina said. “I think that people going to the races and wagering on the horses will be interested in going to Atlantic City.”
Kulina said there is a possibility that Resorts and Monmouth will integrate their loyalty programs so that customers can redeem their rewards points at both facilities. Resorts and Atlantic City’s other casinos have loyalty programs that reward gamblers with free hotel rooms, show tickets, meals and other perks. Monmouth Park has the Big M Club, a rewards card that gives racing fans cash and meals, depending on their level of betting at the track.
All of these things mesh with Bailey’s strategy to incorporate horseracing with casino gambling. Gomes, who partnered with Bailey to buy Resorts in December for $31.5 million, said the two men previously looked into the possibility of acquiring the Gulfstream Park racetrack casino in Florida.
“Morris has always loved horseracing,” Gomes said. “He’s always been interested in linking a racetrack with a casino. It’s partly because he loves the horseracing industry and the track, but it’s not all altruistic. He also wants to make money.”
Bailey, who could not be reached for comment, is gambling on a turnaround at both facilities. Resorts suffered an $18.6 million operating loss last year under its previous owners, while Monmouth had an $8 million loss in 2010.
Bailey, a longtime horse owner, has entered his 3-year-old colt, Concealed Identity, in the Haskell. Concealed Identity, sired by 2004 Kentucky Derby and Preakness winner Smarty Jones, finished 10th in the Preakness in May and was the runner-up in the $200,000 Pegasus Stakes at Monmouth in June.
Resorts’ sponsorship of the Haskell comes four weeks after Gov. Chris Christie vetoed a vote by the New Jersey Racing Commission to use $15 million in new subsidies from the Atlantic City casinos for purse money at the state racetracks, including Monmouth. Christie said the vote ran contrary to his goal of making horseracing a self-sustaining industry.
The governor’s veto marks the first time in seven years that the casinos have not had to help bail out the financially ailing tracks. The casino industry has paid a total of $176 million in subsidies since 2004 to prevent the racing lobby from seeking approval for slot machines or video lottery terminals at the tracks. Casinos have long feared that slot machines at the tracks would end their monopoly on that form of gambling in New Jersey.
Casinos despised having to shell out the subsidies, while the horseracing industry argued that the payments were crucial for attracting high-quality races through big purses. Christie’s veto appears to finally have ended the subsidy arrangement.
Gomes, who formerly served as president of Trump Taj Mahal Casino Resort and Tropicana Casino and Resort during his nearly 40-year gaming career in Atlantic City and Las Vegas, once was one of the biggest opponents of casino subsidies for the tracks.
“I was at the forefront of the fight against the assessment for the racing industry,” he said, recalling his time as president of the Casino Association of New Jersey, the lobbying group for Atlantic City’s gaming industry.
Now, Gomes and Resorts have broken from the rest of the casino industry to cooperate with the horseracing industry through the Monmouth Park partnership.
“It’s very unique from that standpoint,” Gomes said. “We’re exploring a lot of things to do with them.”
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