Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SUNDAY, November 7, 1993 TAG: 9311090308
SECTION: VIRGINIA PAGE: A1 EDITION: METRO
SOURCE: MIKE HUDSON STAFF WRITER
DATELINE: COVINGTON LENGTH: Long
What in the world is a dentist from Covington doing trying to build a $28-million horse-racing and gambling mecca between Richmond and Williamsburg?
"I've been asked that a lot," Jeffrey Taylor says.
He explains: Earlier this year, he was surprised to learn that no one had applied to run a horse track in Virginia - even though the state's voters had approved pari-mutuel gambling on horse racing back in 1988.
The more he looked into it, he says, the more he realized it could be a great boost for Virginia's horse and tourism industries. "And a great business opportunity for somebody who's got the guts to try."
Next question:
What chance do Taylor and his business partners - all novices to the horse-racing world - have of winning a state license competing against organizations like Churchill Downs, which runs the Kentucky Derby?
Taylor, 39, concedes that his group, Virginians Inc., is something of a dark horse in the state's race-track sweepstakes. But that doesn't deter him. "I'm biased, but I think we have a 99 percent chance of getting it."
He says Virginians Inc. has the best location and the best plan to sway the Virginia Racing Commission, which is expected to award a license to one of the six applicants. The commission hopes to select a winner next spring.
Less than a year ago, Taylor knew almost nothing about the horse-racing and gambling business. How he got into the race for a state license is a story of a tireless, down-to-the-wire effort by Taylor, his family and their allies.
It started in January in a banquet room at The Homestead during the annual meeting of the Alleghany Highlands Chamber of Commerce. A state official was talking about economic development and had brought along some handouts. Taylor, a director of the chamber, was scanning the papers when he noticed a mention of the Virginia Racing Commission.
"What's that?" Taylor asked a friend at his table. "Car racing?"
No, horse racing. But Taylor learned that nobody had applied for a license to operate a track since voters had approved gambling on horse racing.
According to The Washington Post, the weak economy and the decline of the horse-racing industry nationwide had helped scare off potential investors in a Virginia track.
Taylor, who owns four trail horses on his Alleghany County farm, was curious. He did some research. He stayed up several nights brainstorming about how he could open a race track.
Within a week, he had decided to go ahead with the project.
It became a seven-day-a-week, 12-hour-a-day obsession. "At first, everybody thought I was crazy," he says. "I basically went after it like it was a huge research paper."
He called experts all over the country, ringing up phone bills of $800 to $900 a month.
To his surprise, these horse-racing insiders didn't give him short shrift just because he was a novice. In fact, he says, they were very generous with their time in helping to educate him about the sport and the business of racing.
"It's been an adventure," Taylor said. "It's like going to college again in a different subject."
Even with the expert advice, Taylor knew he couldn't do it alone. He pitched his idea to his family.
His brothers - Greg, a Covington contractor with a long resume of industrial and commercial projects, and Kirk, a recent engineering graduate from Clemson - came on board.
So did his father, Bill Taylor, a former Covington mayor who now lives in South Carolina. Bill Taylor is Southeastern U.S. operations manager for the Harris Group, a national engineering firm. He's worked on paper-mill construction and expansion projects worth hundreds of millions of dollars.
Two others - Steven Minter, a Covington financial consultant, and Edward Trope, a Richmond attorney - also joined the team.
When Jeff Taylor and Minter attended the Racing Commission's February meeting, there were just three other people in the audience.
At the same time, though, the General Assembly was revising its pari-mutuel betting laws. One key change the legislature made this year was allowing the track operator to open off-track betting facilities in other parts of the state.
Don Price, executive director of the Racing Commission, says that made things much more attractive to potential investors. "Everything opened up as far as interest," Price says. "Everything got into high gear."
In came the heavy hitters.
Four of the applicants already own race tracks in other states or Puerto Rico. A fifth competitor's effort is headed by Elmon Gray, a well-connected former state senator from Tidewater.
Now when Taylor goes to the commission's monthly meetings, there's a small crowd.
At first, Taylor hoped to build a race track in the Alleghany Highlands. But he soon realized that the population of this part of the state made it impossible to build a profitable track in the western half of the state.
So he and his partners settled on another site, 345 acres of woodland in New Kent County, just off Interstate 64. Taylor says it's perfectly situated - 21 miles from Richmond and 26 miles from Williamsburg. It's within 100 miles of 4 million people. Not to mention that 9 million tourists pass through that I-64 corridor each year.
Two other investment groups have proposed New Kent as a site as well. Other proposed locations are Portsmouth, Virginia Beach and Prince William County.
Taylor says the his plan has an advantage over other proposals. Its creative financing means it won't be buried under a mountain of debt.
The group will borrow about $17 million, but it has some other help. New Kent County has promised to donate $1.85 million for off-site road improvements. And Chesapeake Corp., a large paper company, has promised to donate the land and help with issuing $2.4 million in industrial bonds.
Chesapeake Corp. hopes to use its surrounding land to develop hotels and other tourist businesses related to the track.
As Taylor's team came together, it scrambled to put together its application. The Racing Commission set an Oct. 1 deadline for all proposals.
On Sept. 22, Chesapeake Corp. came to Virginians Inc. with a new, more attractive financing option. The team had to rework its application to reflect it.
They made the deadline. At 8:30 a.m. on Oct. 1, Virginians Inc. hand-delivered its 385-page application.
Peter Drypolcher, former general manager of The Downs at Albuquerque and Santa Fe in New Mexico, helped the team put together the proposal. If it flies, he will run the track's day-to-day operations.
Now, all six applicants have until Jan. 3 to file additions to their plans - which already would stand 4 feet if stacked one on top of another.
It's been a long haul, but Taylor says it's worth it.
At first, he says, no one seemed to take his team very seriously. Now he believes that's changed.
Price, the commission director, can't comment directly on the Taylor team's proposal. But he does say that in assessing a license application, "you look at the credibility of the operator. I'm proud to say that all six groups that have applied are all very credible."
Taylor says simply, "We've read all the others' plans. We know ours is the best plan."
\ VIRGINIA DOWNS Virginians Inc. proposal
Site: New Kent County.
Size: 345 acres.
Proposed opening: Spring 1995.
Types of tracks: Dirt, sod and steeplechase.
Racing days: 112 in 1995 with 200 days of "simulcast" races from other tracks. 151 live racing days by 1996.
Clubhouse capacity: 3,980.
Total facility capacity: 15,580.
Projected revenues: $17 million in 1995; $22.9 million in 1999..
Estimated jobs created: 1,093.
Off-track betting locations: Six, mainly in the Hampton Roads and Richmond areas. Other possible off-track sites: Northern Virginia, Roanoke.
by CNB