THE VIRGINIAN-PILOT
Copyright (c) 1994, Landmark Communications, Inc.
DATE: Thursday, October 13, 1994 TAG: 9410130508
SECTION: FRONT PAGE: A1 EDITION: FINAL
SOURCE: BY ALEC KLEIN, KAREN WEINTRAUB AND TONI WHITT, STAFF WRITERS
DATELINE: RICHMOND LENGTH: Long : 194 lines
Hampton Roads lost out on more than 1,000 jobs and potentially millions in tax revenue Wednesday when the state awarded Virginia's only horse track license to rural New Kent County.
The track site between Richmond and Williamsburg had just two strong supporters among the five state racing commissioners. But two others eventually joined, including the only member to argue for a Hampton Roads site.
The final tally was 4-0 for the Colonial Downs application submitted by Arnold Stansley, an Ohio businessman and track operator, and his partner, Joseph A. De Francis, a Maryland racing mogul.
The fifth commissioner, Arthur W. Arundel, who preferred a track in his Northern Virginia region, did not vote.
The proposals offered by Virginia Beach and Portsmouth fell short, the Virginia Racing Commission said, for two basic reasons: They were too far south of the state's horse industry and had planned too few days for thoroughbred racing.
None of the five commission members expressed support for the Virginia Beach site, despite the $54 million proposal and the reputation of its operator, Churchill Downs Inc., runners of the Kentucky Derby.
Only Robert G. Beck of Newport News said he considered voting for Portsmouth's $65 million project. It was submitted by Virginia Racing Associates, a group of in-state investors headed by William M. Camp Jr. and former state Sen. Elmon T. Gray.
``I'm shocked,'' Gray said. ``I'm more than shocked. . . . We had the two strongest applications out of the state.''
A second application from New Kent and one from Prince William County also were rejected.
Before the decision, Virginia Beach Vice Mayor William D. Sessoms Jr. was wired with anticipation. Moments later, he was practically in tears.
Virginia Beach had hoped the track would boost its already vibrant tourist industry. Portsmouth had even more at stake: It was counting on the track as a catalyst for revitalization.
Both cities immediately began touting other projects. In Portsmouth, City Council members said they are considering an industrial park and $150,000 homes at the proposed track site.
Virginia Beach officials were also moving on Wednesday.
``Let's build an amphitheater,'' said Mark Wawner, acting director of the city's economic development department.
The $40 million Colonial Downs track will be located on a 345-acre site at the intersection of Interstate 64 and State Route 155.
It is expected to be completed by late 1995, with the first major races to be held in early 1996. Colonial Downs plans to begin broadcasting out-of-state races at off-track betting parlors before the New Kent track opens.
Colonial Downs will transform what is now a bucolic county of pine trees, cows and 13,000 inhabitants located about 30 minutes from downtown Richmond. Upon winning the license, New Kent supporters erupted in celebration.
``For about five minutes, it was better than sex,'' said Michael J. Mulvihill, a public relations executive representing Stansley's winning bid.
By comparison, Stansley, who had begun his career around horses as an exercise boy, was humble.
He is part-owner of Raceway Park in Toledo, Ohio, Trinity Meadows in Fort Worth, Texas, and Virginia's future track.
Several hundred New Kent supporters gathered Wednesday evening at the White House restaurant several miles from the proposed track site. Most of the men were wearing ties with horse designs, and the women sported horse jewelry and jackets.
They were happy, but concerned that the track bring the right kind of development.
``We'd love to have everybody from Virginia Beach and Richmond come here, spend their money, and then get back on 64,'' said John Crump, a small-businessman who had initially opposed the track.
The commission's 32-page decision cited as selling points Stansley's emphasis on thoroughbred racing, cooperation with the Maryland racing industry and New Kent's central location.
The commission also gave weight to Stansley's ``conservative'' package, calling it a ``sound, feasible, and reasoned plan'' based on a ``philosophy to start modestly.''
Commissioner Ernest M. Oare of Warrenton, one of the two panelists who had favored a track in Northern Virginia, was eventually swayed to the New Kent proposal, joining Beck, chairman John H. Shenefield, of Great Falls, and Robin T. Williams, of Crozier.
Churchill Downs President Thomas H. Meeker characterized Stansley's winning application as a ``geopolitical'' compromise.
``I had not got a sense that there was any political arm-twisting in this,'' Meeker said. ``(But) clearly you had two commissioners who wanted it in Northern Virginia.''
Well-heeled Northern Virginia horsemen had lobbied heavily for James J. Wilson's unsuccessful Prince William track proposal.
Both Portsmouth and Virginia Beach had their strong political support.
But Stansley could counter with De Francis, a partner who owns and operates Laurel and Pimlico race tracks in Maryland.
De Francis had warned the commission that he could work with no other applicant, and he had raised the specter of a racing war between Virginia and his Maryland tracks.
De Francis, who will control Colonial Downs' 102-day thoroughbred season, tried to erase concerns that he would usurp Virginia's track.
He committed to closing his two Maryland tracks from mid-June to mid-October so he could bring his circuit to Virginia for an elegant Saratoga-style summer meet.
Colonial Downs is also negotiating a similar agreement with Maryland's Rosecroft Raceway harness track.
The commission next must decide where to place up to six off-track betting parlors. Colonial Downs is considering two sites in Virginia Beach, and one each in Portsmouth, Chesapeake, Richmond and Brunswick.
Although industry experts say the state can support only one race track, there is nothing to prevent the commission from granting another franchise later.
And any of the losing applicants could contest the decision by filing a lawsuit. Neither Virginia Beach nor Portsmouth has threatened to do so.
``This (commission) decision was written to give them an air-tight defense,'' Carrie Camp told fellow Portsmouth applicants.
Even without legal battles, Colonial Downs will likely have a struggle.
It must make its facility financially successful in an age when the majority of new tracks are battling bankruptcy.
Working against Stansley is New Kent's relative obscurity and its distance from the state's largest population and employment bases.
Colonial Downs may also have to face competition from riverboat casinos, which has meant sudden death for tracks in other states.
The General Assembly is expected to consider approving casino gambling when it convenes in January.
``It is a very serious threat to our ability to get a fledgling industry off the ground,'' De Francis warned. ``Horse racing cannot compete effectively with casino gambling.'' ILLUSTRATION: PAUL AIKEN/Staff
[Color Photo]
Arnold Stansley, president of the winning Colonial Downs racing
company, lets out a shout of joy after the 4-0 vote, with an
abstention, to put the state's first race track on his New Kent
County site. Only two of the five commissioners initially supported
Stansley's and John De Francis' plan.
PAUL AIKEN/Staff
Virginia Beach Mayor Meyera Oberndorf and Churchill Downs' Tom
Meeker and Cathy Zega, from left in front row, hear the news
Wednesday that their track site near Oceana Naval Air Station had
been rejected.
WHY LOCAL BIDS WERE REJECTED
Virginia Beach
Not enough days of racing for thoroughbreds or Virginia horses to
spur investment in state ``bloodstock, farms, and other capital
resources.''
Too much emphasis on simulcasting races from elsewhere ``to the
detriment of a live racing program.''
No promise by Churchill Downs Inc. to stop racing in Kentucky
during the season in Virginia Beach.
Fans would overwhelm capacity at the Hampton Roads Bridge Tunnel,
causing delays in the transportation of horses and inconveniencing
track patrons.
Churchill Downs Inc. had not sold $8 million of equity
financing.
Too much military aircraft noise at the site near Oceana Naval
Air Station.
Too far from major sources of racehorses.
Portsmouth
Too few thoroughbred racing days.
Too much emphasis on a standardbred program, which does little to
promote or sustain the native Virginia thoroughbred industry.
Site would require relocation of a substantial number of
residents in the Fairwood Homes neighborhood and might require the
use of condemnations to acquire remaining parcels.
Too far from major sources of racehorses, making it difficult to
maintain an adequate supply of high-quality horses.
New Kent County
Why it got the track:
Its site is the most centrally located and would have the least
environmental impact.
Its operator would create a Virginia-Maryland thoroughbred
circuit drawing horses from a wide region.
Its plan emphasized the more desirable thoroughbred racing.
It had the best financial package.
Its principals have a record of success in the operation and
management of both thoroughbred and standardbred race tracks.
Its facility would cost far less than those in other
communities.
Its operators completed more preconstruction permitting and
environmental work than any other site, and because of the
operators' development plan and construction experience, was the
most likely track to be built quickly.
Map
REACTIONS FROM TRACK PROMOTERS, RESIDENTS/A8.
KEYWORDS: HORSE RACING RACE TRACK VIRGINIA RACING COMMISSION by CNB