THE VIRGINIAN-PILOT
Copyright (c) 1994, Landmark Communications, Inc.
DATE: Sunday, October 9, 1994 TAG: 9410090059
SECTION: FRONT PAGE: A1 EDITION: FINAL
TYPE: SPECIAL REPORT
HORSE RACING IN VIRGINIA
SOURCE: BY TONI WHITT AND KAREN WEINTRAUB, STAFF WRITERS
LENGTH: Long : 118 lines
On Wednesday, the Virginia Racing Commission is expected to decide whether Hampton Roads will get the state's only horse track.
No challenger has as much at stake as Portsmouth, where victory means much more than money. A race track would bring prestige, political clout and a chance for the struggling, urban city to establish a winning image.
In Virginia Beach, the other Hampton Roads community in the field of five, the track could enhance an already healthy tourism industry.
Both Portsmouth and Virginia Beach have spent years and taxpayers' money competing for the track. In return they expect to reap millions in revenue, to see a growth in local agribusiness and a gain in stature that can't be measured with dollar signs.
The racing commission is the final hurdle after years of work to get a horse track. In a statewide referendum, voters approved pari-mutuel betting in 1988. In March 1992, the General Assembly approved off-track betting parlors. Localities across the state then held separate referendums to test whether local voters would approve a race track in their community. In May 1992, 71 percent of Portsmouth voters supported a track. Six months later, 63 percent of voters in Virginia Beach supported the same issue.
Once off-track betting was approved in key parts of the state, such as Northern Virginia, racing groups submitted their applications. After receiving the applications last year, the racing commission began a flurry of site visits, public hearings and formal presentations. On Wednesday the long wait will be over.
Portsmouth officials are betting that a track would launch the city toward a future filled with tourist attractions instead of dilapidated neighborhoods.
``It has to be a point of pride,'' said Steve Herbert, the assistant director of the city's economic development department. ``It will be a destination for people in the Hampton Roads region. To the extent that it brings people to Portsmouth, it's very important.''
Virginia Beach officials say the track would be a huge boon to the area. But if they lose, life at the beach will go on.
``Having the track here will be one more reason why people will want to come to Virginia Beach,'' Councilman Louis R. Jones said. ``(But) while we see the race track as an additional component of our excellent image, I don't see it as necessary to bring us a good image.''
Portsmouth City Manager V. Wayne Orton hopes that a track would entice an upscale hotel to his city. The Holiday Inn is the city's best hotel. Portsmouth has just 475 hotel rooms. There are about 11,000 at the Virginia Beach Oceanfront alone.
The city of Portsmouth already has invested $100,000 to win the track. The Portsmouth Partnership, a group of business leaders that regularly supports the city's economic development efforts, contributed another $100,000.
That pot was more than matched by the Virginia Racing Association, which would hold the track franchise. It spent $350,000 to lobby for the track, as well as for preliminary engineering, architectural renderings, and traffic and environmental studies, officials said. The association spent another $150,000 in its successful effort to get off-track betting approved.
Portsmouth's supporters have wagered the $700,000 in hopes of a payoff of about $2.8 million a year in direct track revenue for the city, officials say.
If Portsmouth wins the track it would invest much more. The city has pledged $15 million to buy the site and would guarantee up to $35 million in bonds issued by the Sports Authority of Hampton Roads. The Virginia Racing Association has agreed to repay the total annual debt on the bonds, about $3.1 million per year. It also would pay up to $1.5 million per year for 35 years to Portsmouth and other cities in the region that agree to back the bonds.
Orton said that if Portsmouth fails in this bid, he and the economic development department are sure to be criticized again.
But Herbert, the city's assistant economic development director, predicted a Portsmouth loss would do little political harm. He said the city already has proved itself a winner by convincing a group of investors to split off from Churchill Downs Inc. to support a Portsmouth track over one located in Virginia Beach.
``The city has learned it can compete with anybody,'' Herbert said.
Virginia Beach is a front-runner, thanks largely to Churchill Downs, operator of the Kentucky Derby and one of the most respected and successful track operators in the business.
Thomas H. Meeker, president and chief executive officer of the company, said Virginia Beach was one of the last cities at which he looked. The company, which was introduced to the region by Portsmouth, at first believed the Beach was too isolated from the rest of the state.
But, Meeker said, the quality of the city's roads and other public services combined with the political, business and public support he found in Virginia Beach ``convinced us we had the right partner.''
To sway Churchill Downs, Virginia Beach offered a package of incentives worth more than $20 million, including $5 million for roads, sewers and other services and $15.5 million in payment guarantees. Virginia Beach officials have spent about $20,000 on the track application, department of management and budget director E. Dean Block said.
Councilman Jones and Virginia Beach Mayor Meyera E. Oberndorf said the track would create jobs, increase agribusiness and draw tourists during the offseason, justifying the financial investment.
``In the long run, it'll be a sizeable tax revenue source for the city of Virginia Beach, which is the primary reason for any kind of economic development,'' Jones said, predicting the track would generate $2.7 million a year in direct revenue to the city.
Officials from both Virginia Beach and Portsmouth agree they'd rather lose the track to another Hampton Roads city than see it go to New Kent or Prince William counties. That way, they say, the two cities would still reap some of the financial benefits of horse racing.
``If we get it, it's great; if we don't, I hope Portsmouth will get it,'' Virginia Beach Councilman William W. Harrison Jr. said. ILLUSTRATION: Color photo
ASSOCIATED PRESS FILE
Churchill Downs, which is backing a proposed track in Virginia
Beach, operates the Kentucky Derby.
KEYWORDS: HORSE RACING RACE TRACKS by CNB