"Historic" horse racing ballot question raises issues

When Nebraskans vote this November, they are scheduled to face the question of whether or not to legalize betting on “replayed” horse races. But opponents are trying to keep that question off the ballot.

At the track in Columbus, Nebraska on a perfect, sunny, summer Sunday, the air was filled with the sounds of live horse racing. A bugle call to post. An announcer calling the race. Fans cheering as horses approached the finish line.

Meanwhile, at a racetrack in Henderson, Kentucky, people were betting on an “instant racing machine.” There, the soundtrack was more like the beeping and blaring of a video game.

If voters approve amending the Nebraska Constitution this November, those sounds could be coming to tracks in this state.

The sounds in Kentucky were coming from an “instant racing machine” at the Ellis Park racetrack. But if you look at the machine on the website, horses are not the most prominent animals shown. Instead, it is cartoon alligators.

This is a game called “Bayou Bash,” in which a player pushes a button every few seconds, setting alligators, crayfish, and other swamp creatures reeling like the apples, cherries and lemons on an old-fashioned slot machine. Those symbols, in turn, reflect the various horses in a previously-run race Ellis Park Operating Manager Bob Jackson said is shown on a small screen underneath the main one.

Instant racing machines first appeared in the 1990s in Arkansas, where race track executives like Louis Cella were trying to figure how to compete with casinos. Cella said the machines let players bet based on their own assessment of handicapping information. Or, they can push a “handi helper” button and let an algorithm do it for them.

That means people can bet like they’re using a slot machine. Cella, who’s also an executive in the company that manufactures the machines, said he tells other racetrack officials “just because you cannot have a ‘casino’ -- just because you cannot have slots -- it does not mean you cannot act like one.”

But Cella added legally, the machines are not slots, because players are betting against other players making similar bets – parimutuel betting -- not against the house.

Arkansas and Kentucky are two of the five states, along with Wyoming, Idaho, and Oregon – where instant racing machines are allowed. But if Nebraska voters approve, machines like this could be coming to tracks in Columbus, Omaha, Grand Island and Hastings, and the simulcast facility in Lincoln, along with other locations on Native American lands if the tribes want them.

Tom Jackson, one of five partners who manage the Columbus track, strongly supports the ballot proposal. Jackson says extra money from the machines would help both the state and the horse racing industry in Nebraska. Last year, that industry had only half the live racing days, and three-quarters of the betting revenue, it had five years earlier.

“We need a little boost to the horse racing industry, not only for the economic impact of helping communities, but also the economic impact that it has for the trainers, owners, developers and all that,” Jackson said.

That’s the way it has worked in neighboring Wyoming, said Charlie Moore, executive director of that state’s Pari-Mutuel Commission. The Wyoming legislature legalized the machines in 2013, and in the first six months of this year, people bet $30 million on them, compared to $3.5 million on simulcast horse races and a little more than $1 million expected on live races this year. Moore says with the additional revenue from the instant racing machines, racing days have increased from 10 last year to 20 this year, and may reach 30 next year.

But the proposal to allow the machines in Nebraska is provoking opposition. Pat Loontjer of the anti-gambling group Gambling with the Good Life visited the Ellis Park racetrack in Kentucky recently, and came away unimpressed.

“Over July 4, a friend and I drove 10 hours down, 10 hours back, spent two hours at the horse casino down in Ellis Park. And we took these pictures that you’re going to see of the actual machines. And there’s no resemblance – you can’t even find a horse on these. These are slot machines,” Loontjer said.

Loontjer has been showing the pictures she said she took in Kentucky to Nebraska editorial writers, trying to convince them to oppose the ballot issue. Meanwhile, she has filed a lawsuit trying to remove the issue from the ballot.

Loontjer’s lawyer, Steve Grasz, argued by asking voters in one question to approve both a new form of gambling and a new scheme for distributing the revenue from it, the Legislature violated the state constitution.

“All of these provisions are designed to prevent what is called ‘logrolling,’ Grasz said. “The thought there is that you cannot entice the voters to support one amendment or proposal to tying it to another proposal.”

Grasz argued the ballot proposal tries to entice support for legalizing the new machines by promising to use new state tax money for schools and property tax relief.

Omaha Sen. Scott Lautenbaugh, who sponsored the proposal in the Legislature, argues the subjects are naturally related.

“There’s nothing forcing people to vote for something they don’t want. That’s kind of a whole package. You would have to support the creation of this stream of revenue to get the stream of revenue,” Lautenbaugh said. “That’s not logrolling. That’s a nod to reality.”

The Nebraska Supreme Court will hear oral arguments August 27 about whether the question should appear on the ballot.