Categories: Schenectady County
Economic woes are starting to have an impact on parts of New York’s gaming industry, state officials said.
Figures released by Capital OTB indicate a $7 million decline in the betting handle in October. The 4 percent decline in the Capital Region last month comes on top of a collective $86.8 million decrease in the handle at the six OTB agencies operating across the state through September.
Capital OTB President John Signor attributed the decrease to the struggling economy across the nation. He suggested that the recent downtrend has taken a toll on the gaming industry nationwide.
“As we all know, the declining economy has taken its toll on everything from the financial markets to state and local governments to Las Vegas and Atlantic City casinos — to New York state OTBs,” he said.
Signor said the reduced handle is compounded by the rising number of bettors using out-of-state Internet wagering sites.
Additionally, he said Capital OTB is hampered by the $3.2 million annual payment to Saratoga Gaming and Raceway from the $3.7 million bet through OTB on the harness track, a stipulation of the state’s “hold harmless” mandate.
“The track is getting 86 cents on every dollar wagered at Capital OTB,” he said. “That is outrageous.”
The stipulation was created before video lottery terminals were allowed at the track. Signor said the new VLT income should make the payments unnecessary.
Like OTB, the New York State Lottery has also witnessed a slight second-quarter decline in sales of its traditional games, such as Lotto, Mega Millions and Quick Draw. Over a 13-week period ending in September, these games experienced a 0.1 percent decrease from the previous year, continuing the nearly flat profile that was reported in fiscal year 2007.
Lottery Spokesman John Charlson said some of the decline can be attributed to the economy. But he warned that many other factors come into play, such as the type of prize being offered.
For instance, second-quarter sales of the Mega Millions game declined by $44 million — or 30.1 percent — between 2007 and 2008. However, the game offered a $325 million jackpot in August 2007, something that wasn’t duplicated this year.
VLTS do well
In contrast, the state’s eight VLT parlors have seen a marked increase in betting, which balanced any losses in traditional gaming. Bettors have wagered $491 million during the first half of 2008, a 13.7 percent increase from the previous year.
Empire City at the Yonkers Raceway had the largest increase in VLT wagering over the first two quarters of 2008, with a 22.7 percent increase. Locally, Saratoga Gaming and Raceway experienced a $2 million increase, accounting for a modest 2.9 percent growth over the same period in 2007.
As a whole, New York’s racinos have experienced more growth than other gaming facilities around the Northeast, according to October’s Fantini Gaming Report, a journal that tracks trends in the industry. Fank Fantini, the chief executive officer of the Delaware-based company, said New York’s relatively new racinos are starting to draw customers away from more traditional areas of gaming like Atlantic City in New Jersey and Mohegan Sun in Connecticut.
While seven of the Empire State’s eight racinos experienced increases in VLT wagering, Connecticut’s casinos have seen a 6.2 percent decline with their machines. Fantini said Connecticut’s VLT wagering in September was down by more than 14 percent.
“They’re stealing customers away from more mature markets,” he said of New York’s recent VLT success. “The phrase is convenience gambling. If you live in the New York City area, where Yonkers opened up, why go all the way down to Atlantic City?”
But don’t expect the racino bump to last for long, Fantini said. As regional competition grows — such as the gaming resort under development in the Catskills — he said the betting at New York’s racinos will level off.
“It will mature,” he said.