August 18, 2009 - Satellite wager sites yanked
By Michelle Durand, The Daily Journal
Golden Gate Fields withdrew its applications for two mini-satellite wagering sites in the city of San Francisco but San Mateo County officials say the battle to prevent illegal competition with the Jockey Club continues.
The California Horse Racing Board was poised to allow the off-site betting at Pete's Tavern and Sotto Mare despite a 20-mile radius ban from the San Mateo-based Jockey Club. On Aug. 14 - the day after Assemblyman Jerry Hill, D-San Mateo, and local officials decried the request publicly - Golden Gate Fields General Manager Robert Hartman withdrew the applications citing "business reasons."
Hartman said questions over the radius propelled the withdrawal but even if it is resolved in the city's favor, the two locations are "unlikely" to reapply.
The decision is not a reason for celebration but to continue efforts to enforce the existing limitation, said County Counsel Porter Goltz.
Goltz anticipates the horse racing board continuing the possibility of changing the law and Hartman said he's hopeful to one day have multiple locations in San Francisco and the Bay Area.
The future possibility is why Goltz, Hill and other local officials say the fight is far from over.
"This is good news for the Jockey Club and Event Center right now but we must keep an eye on it and be vigilante and make sure the board knows that 20 miles is 20 miles," said Supervisor Carole Groom who sat on the San Mateo City Council during the lengthy fight to demolish the Bay Meadows race track and establish the Jockey Club satellite wagering site at the Event Center.
The 16,000-square-foot Jockey Club opened a year ago, days after the Bay Meadows race track closed, and is expected to bring in $85 million this year. The club keeps 2 percent of the figure and the city of San Mateo takes in approximately $250,000 annually. The revenue is also used to pay back loans to the county and state used to build the facility. All of these funds would be jeopardized by satellite sites in San Francisco because 40 percent of bettors come from the city and northern end of San Mateo County, Hill said.
The Jockey Club is the only fairground satellite wagering facility funded by its county. The others were built through state grants. In securing the loans necessary for the $5 million renovation, the event center board of directors and county relied on the guaranteed protective zone to ensure its ability to repay the loan.
The law allows exceptions but only with permission. Hartman said Golden Gate Fields didn't speak to Event Center officials because the California Horse Racing Board said they were outside the 20-mile radius.
Last Thursday, Hill, Groom and others blasted the board for its "stealth plan" and vowed to fight any attempts to change the radius.
Hill said on Friday he sent notice to every legislator about the possibility. He previously mentioned legislation mandating notice when the board is considering satellite sites and calling on the CHRB to meet with San Mateo delegates to discuss the issue.
With the applications off the table, Hill said there is less urgency to act on legislation.
"Since the cat is out of the bag and they were caught red-handed, there is more time to make whatever changes are needed," Hill said.
Hill said he wasn't worried about the horse racing board acting illegally because they could be taken to court but the effort to change the law is a different matter.
Even if the county agreed to allow the sites or the CHRB gets the Legislature to change the law, the city and county of San Francisco still needs to allow zoning and planning exceptions for gambling.
The first step, though, is agreeing on the law.
"We need to figure it out so everybody knows where they stand," Hartman said.