The Canterbury Park horse race track has agreed to drop its long pursuit of slot machines in exchange for the Shakopee Mdewakanton Sioux Community paying the track $75 million to fatten its purses over 10 years, according to a deal announced Monday that protects the tribe's lucrative nearby casinos.
Canterbury has pursued slots for more than a decade, arguing it needed more revenue to revive Minnesota's horse racing and breeding industries. The state's two tracks have been struggling to attract the best horses and jockeys against competition from other Midwestern tracks that pay higher purses, Canterbury president and CEO Randy Sampson said.
The tribe's money will allow Canterbury to more than double its purses within a few years, Sampson said, allowing the track to offer what he promised will be world-class racing to go with what's recognized as a world-class track complex.
"The agreement provides the best of all worlds. Our two businesses will focus on what we do best _ in our case that's horse racing _ and SMSC and Mystic Lake, they'll continue to operate a world-class casino hotel and entertainment venue," Sampson said.
The tribe will benefit, too, because the agreement solidifies the southwest corner of the Twin Cities metro areas as the premier entertainment and gambling destination for the region, said Edward Stevenson, president and CEO of the SMSC Gaming Enterprise, which operates the tribe's Mystic Lake and Little Six casinos just four miles down the road from Canterbury.
The agreement also includes the tribe paying $8.5 million for joint marketing that will boost the tribe's total contribution to $83.5 million.
Stevenson noted Canterbury doesn't have a hotel, golf course or slot machines, while Mystic Lake and Little Six don't offer poker, which means there are opportunities for building up two-way traffic between them.
"On a good racing day at Canterbury Park we anticipate 10,000 to 12,000 fans. And we're hoping that when they finish enjoying a day at the races they'll come back down to Mystic Lake or Little Six Casino and enjoy themselves there," Stevenson said. While cross-marketing plans still are being worked out, he said the possibilities include card tournaments and other special events.
The Minnesota Racing Commission still needs to approve the deal. Sampson said both sides are hopeful the commission will schedule a special meeting and approve it within a couple weeks.
The racing commission's executive director, Richard Krueger, was out of the office and not reachable for comment Monday.
Minnesota track owners and horse breeders had pushed to add slot machines to turn the tracks into "racinos" as a way to fund various state initiatives while helping the horse industry. But the plans have routinely failed in the Legislature, thanks to twin-pronged opposition from gambling opponents and American Indian tribes that want to block competition to their casinos.
It came up most recently in March amid the debate over funding for a new Minnesota Vikings stadium. A state Senate committee rejected the idea. Racino backers estimated at the time that adding about 2,000 slot machine-style games to Canterbury and Minnesota's other horse track, Running Aces Harness Park in Columbus, would generate up to $130 million in new tax revenue while boosting purses.
The deal doesn't prevent Running Aces from asking the Legislature for slot machines again, but it probably doesn't help its chances. Sampson said the deal obligates Canterbury to actively oppose a racino at the smaller harness track in the northern suburbs. But Sampson and Stevenson said there was nothing to prevent Running Aces from making a similar deal with other tribes, though their casinos all lie outside the metro area.
Bob Farinella, general manager of Running Aces, said his track wasn't part of the agreement and he couldn't comment further because he had no details. Farinella said he hadn't been aware any agreement was imminent.
Further down the road, Samson said, there's also been discussion about allowing simulcasting of horse racing at all Minnesota's tribal casinos, and he said Running Aces could be part of it, but there are legal obstacles that must be worked out first.
Sampson said the tribe will add $2.6 million this year to the $6 million the track spends annually on purses. He said the tribal contribution will grow to $5.3 million next year and increase to $8 million annually for 2018-2022. The cooperative marketing payments will start at $300,000 next year and increase to $900,000 a year by 2018-2022.
Sampson and Stevenson said the deal had its roots in the recent legislative session, when leaders including House Speaker Kurt Zellers and Gov. Mark Dayton encouraged the track and tribe to set aside their differences and find a way to work together. They said they began serious discussions about a month ago.