The Massachusetts Gaming Commission has put the lid on the efforts of Plainridge Racecourse to win the state’s sole slot parlor license. In a decision announced yesterday, officials deemed the ownership group of Ourway Realty to be unsuitable for a gaming license. The Commission also announced that Raynham Park and its principals were suitable, so that property moves forward in its bid along with other competitors for the license.
A big part of the task set forth by the Commission is to determine the character of the applicants, and it has left no stone unturned. While Raynham was allowed to move forward, the Commission cited several concerns about its principals but was swayed by testimony and issued conditional suitability. For Plainridge, however, there was no such compelling testimony.
The background investigation “revealed that there appears to have been a culture of fear and concealment pervasive in the operations of Plainridge. Understanding the potential repercussions relative to the future of the Plainridge racetrack in the event of a negative finding of suitability of Ourway, the Commission attempted to view the present situation in the most positive light possible. Even in that light, however, clear and convincing evidence as to business practices that will likely lead to a successful gaming operation is lacking.”
The biggest problem with Plainridge, said the Commission, was evidence that former “functional head” Gary Piontkowski (who stepped down earlier this year) withdrew funds from the track’s money room. Ourway principals Stanley Fulton and Alfred Ross showed a lack of attention to detail, interest in the operation and blind trust in allowing Piontkowski to run the facility, wrote the Commission. Read the full decision.
Meanwhile, the background investigation of Raynham included the principals of Greenwood Racing, the track’s partner and owner of Parx Casino and Racing near Philadelphia. The Commission was concerned about Robert Green’s past dealings with Robert Brennan – remember the disgraced securities dealer who rebuilt Garden State Park as head of International Thoroughbred Breeders? Convicted of securities fraud in 1994 and later of money laundering and bankruptcy fraud, Brennan spent some ten years in prison.
Green and Brennan struck business deals in 1995 and 1996, and the Commission is concerned that “Mr. Green does not show any understanding of why the relationship with Mr. Brennan and the transactions they entered into show a serious lack of judgment on his part.” In declaring Green suitable, the Commission factored in 17 years of good conduct, and will require declaration of any future contact with Brennan should Raynham win the license.
The Commission also cited past tax avoidance strategies used by another principal, Watche Manoukian, but declared him suitable after being convinced of Raynham’s capital structure. Track owner George Carney had to pony up delinquent real estate taxes from property in New Hampshire before being declared suitable. Read the full decision.
What does all this mean? My guess is that Plainridge ceases to exist as a racetrack. The casino legislation does provide revenue for purses to any operating racetrack, but is that enough for a facility that probably lasted as long as it has because it hoped for a gaming license? And the news is nothing but good for Twin River, about 23 miles to its southwest in Rhode Island. While Raynham remains in play, and is about 30 miles from Twin River, the other slot applicants are all outside the southeast corridor.
I’ve said all along that if the state wants to maximize gaming revenues, locating a slot parlor at Raynham would probably not be the best choice if there is a tribal casino in nearby Taunton. But with a desire to award a slots license by the end of the year, just how much will that potential competition be a determining factor?