Mike Campbell | Horse Racing Free Tips

Possible Suitors for Arlington Park, But Will Churchill Sell to a Racetrack Operator?

With the track having been put up for sale and with parent company Churchill Downs Inc. failing to commit to a meet after this year's season, Arlington Park's days may be numbered. But there may be a flicker of hope. Mike Campbell, the president of the Illinois Thoroughbred Horsemen's Association, told the TDN that he knows of a number of companies and individuals interested in buying the track and keep it open for racing.

“There is interest, for sure, from different parties that wish to keep it just as a racetrack,” Campbell said. “They're interested in developing part of the property and keeping the rest of it for live racing. There has been interest from multiple parties.”

Campbell declined to disclose just who was interested in buying the track.

The picture for Arlington became bleak when Churchill failed to apply for a casino license in 2019, saying in a release that it would be “financially untenable” to have a casino at the track. It is widely believed that Churchill does not want a casino at Arlington because it would siphon away business from its successful casino in nearby Des Plaines, Illinois. In February, the track took another step toward extinction when Churchill announced that it was putting the property on the market.

Campbell said those interested in buying the track have only begun the process.

“It hasn't evolved past the point of conversations, discussions,” he said. “There has been nothing in depth.”

At deadline for this story, Arlington General Manager and Senior Vice President Tony Petrillo had not returned a call seeking comment.

Though Campbell said he was a bit more optimistic about Arlington's future than he was before hearing from potential buyers, he said he is afraid that Churchill will not sell the property to anyone wishing to keep racing there. When asked why he had come to that conclusion, he pointed to recent comments made by CDI's CEO Bill Carstanjen. In a recent conference call with shareholders, Carstanjen said: “We will conduct racing in 2021 at Arlington while moving forward with the transaction to sell this highly desirable land for other non-horse racing mixed used options.”

One individual, who asked to remain anonymous, said his group had reached out to Churchill in hopes that they could begin negotiations to buy the track, only to be rebuffed.

“We reached out to them as a group of horsemen to see if they would allow us to pursue buying the track for pari-mutuel racing only and were told that Churchill had no interest in talking to us,” the source said.

When announcing that the track was being put up for sale, Carstanjen made no mention of it possibly remaining as a racetrack.

“Arlington's ideal location in Chicago's northwest suburbs, together with direct access to downtown Chicago via an on-site Metra rail station, presents a unique redevelopment opportunity. We expect to see robust interest in the site and look forward to working with potential buyers,” Carstanjen said in a statement.

Campbell estimated that the property, which sits on 326 acres 30 miles northwest of downtown Chicago, was worth about $125 million. “It's worth a lot less than people have been led to believe,” Campbell said.

Campbell said he could not speculate why Churchill might refuse to sell the track to anyone wishing to keep it open and running for horse racing, but he remained pessimistic that the property would be sold to anyone committed to racing.

“It would do them no harm and it would not put them at a competitive disadvantage if there continued to be racing at Arlington Park beyond 2021,” he said. “There would be no competition for their casino. Gamblers who gamble on slot machines and table games, they are a different breed from horseplayers. The frustrating part for those of us who want to save this historical, iconic racetrack is the fact that everything you can glean from this speaks to Churchill wanting to not allow even racing there. That's baffling to me.”

The 2021 meet is scheduled to end Sept. 25.

Churchill management has released statements that raise the possibility that they will want to keep a racing license in the possibility that they could open a racino somewhere else in the state. Campbell said he was not optimistic that a new track would be built.

If Churchill goes ahead with its current plans, racing in the Chicago area would be down to just one track, Hawthorne. Hawthorne is obligated to also hold a harness racing meet, which means the opportunity to run Thoroughbreds there is limited.

“Arlington Park is a wonderful institution that's been part of our society for almost 100 years and I'm afraid they're going to run a bulldozer through it,” Campbell said.

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ITHA Statement: Illinois Horsemen ‘Appalled By Churchill’s Contempt For Live Racing’

The following statement is from the Illinois Thoroughbred Horsemen's Association in response to a press release from Churchill Downs Inc. saying the company will attempt to sell Arlington Park for development and relocate its racing license elsewhere in Illinois.

Illinois thoroughbred owners and trainers appreciate the opportunity to race this year at Arlington Park, a world-class track, but are disappointed that Churchill Downs will renege on its longstanding promise to preserve and grow jobs in Illinois racing while also serving the best interests of Illinois taxpayers.

Churchill spent two decades lobbying Illinois lawmakers for the authority to develop a casino at Arlington. But since purchasing the majority stake in the nearby Rivers Casino, Churchill has all but abandoned any meaningful commitment to Illinois racing. Churchill abruptly reversed course, deep-sixed that Arlington development plan, and instead devoted itself to ensuring that Arlington could not become a gaming competitor to Rivers.

Churchill's anticompetitive behavior was so brazen, in fact, that its CEO publicly dismissed the prospect that racing might continue at Arlington under another owner and insisted the property would “have a higher and better purpose for something else.” Even in its statement today, Churchill obviously is disingenuous when it claims that it will move the Arlington racing license to elsewhere in Illinois.

“The license is not Churchill's to move,” said Mike Campbell, ITHA president. “Moreover, the notion that a seasoned gaming operator would relocate a racing license away from a state of the art, modern racing facility near the heart of the Chicago metropolitan region to some yet-to-be-determined location is absurd. Churchill is just trying to obfuscate from the fact that it cares only about maximizing profit and will gladly sacrifice the spirit of Illinois law and the livelihood of working Illinoisans to serve its greed.”

The Illinois gaming expansion law was intended to boost overnight purses and otherwise invigorate thoroughbred horse racing in this state for the purpose of creating jobs, sparking economic opportunity and diversifying the tax base for the state and local communities. Illinois owners and trainers are appalled by Churchill's contempt for live racing and the working men and women, from backstretch workers to breeders, who have devoted themselves to Illinois racing and who depend on racing opportunities and overnight purses to support themselves and their families.

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Request to Escrow $4.9M in ‘Recaptured’ Arlington Purses Again Shot Down By State

For the second time in four months, the Illinois Racing Board (IRB) Jan. 21 declined a request by the Illinois Thoroughbred Horsemen's Association (ITHA) to put $4.9 million of “recaptured” purse funds in escrow so that money can only be collected by Arlington Park if the track runs its entire slate of 68 dates in 2021.

During Thursday's IRB meeting, the ITHA restated the same argument it articulated back on Sept. 16, when the 2021 dates were initially granted: that the Illinois racing community doesn't have faith that Churchill Downs, Inc. (CDI), the gaming corporation that owns Arlington, will follow through on running a race meet in its entirety, so ITHA wants the statutorily legal recapture funds conditionally withheld by the IRB as a cudgel of compliance.

The litany of distrust between the ITHA and Arlington is based on three recent incidents: 1) A stunning 2019 decision by CDI to intentionally miss a deadline to apply for racino licensure at Arlington after working for more than a decade with the ITHA to get a gaming law passed; 2) An acrimonious eight-month battle over race-meet contracts for 2020 and 2021 that included numerous blown deadlines and required IRB mediation; and 3) Comments made last July 30 by Bill Carstanjen, CDI's chief executive officer, that CDI will honor its 2021 race meet contract with the ITHA “if we elect to do so” and that the Arlington property “will have a higher and better purpose for something else at some point.”

Recapture has been a controversial entity unique to Illinois racing for 25 years. It's based on a 1995 law that states that if in any given year, total Illinois handle falls below 75% of the state's 1994 benchmark, any track whose handle also falls below its own 1994 individual benchmark is entitled to deduct 2% of the difference from its horsemen's purse account.

To give a long-view example of how much money that law has cost Illinois purse accounts since its implementation, David McCaffrey, the ITHA's executive director, testified Thursday that Thoroughbred and harness tracks statewide over the decades have reaped $298 million in recaptured funds, with Arlington alone raking back $98 million in money that had been earned for purses.

ITHA President Michael Campbell added that recapture “is harmful. It is what has caused the almost total erosion of the industry in Illinois.”

But although they have a problem with the recapture law itself, McCaffrey and Campbell both admitted that Arlington is not doing anything illegal in taking the recapture money according to the Illinois statute.

“It's their legislative right,” Campbell said. “But at the same time, it doesn't mean that it's a good law.”

Campbell noted that Hawthorne Race Course, the other stop on the two-track Chicago circuit, is deferring any collection of its recapture funds until more money is generated for purses when the Hawthorne racino gets up and operational.

Yet Arlington president Tony Petrillo testified that his track already does work with the ITHA to the extent that, “Arlington, prior to this year, has voluntarily capped or put a ceiling on recapture of $4.5 million.”

Petrillo added: “Regarding the [escrow] payment schedule that the ITHA is seeking, first I would say Arlington should not be treated differently than any other racetrack in those terms…. We cannot control the results of the pandemic…. We have accepted 68 days of racing [and] fully intend to run those 68 days of racing…. I don't think [escrowing the recapture funds] would be in the best interest of racing and to set that type of precedent.”

Back in September, when the ITHA first asked the IRB to hold back 2021 recapture funds until Arlington's 68-date season was completed, the IRB's attorney said that statutory provisions didn't allow the attachment of such a stipulation to dates orders. Based on that advice, board members at that time voted 6-0 to grant Arlington's schedule with no escrow strings attached.

But it was noted at that same meeting that the ITHA could bring up the subject again in January, when the IRB had to vote upon setting the 2021 recapture payment schedule.

Yet on Thursday, after hearing from both the ITHA and Arlington for 25 minutes on the topic, no IRB members stepped forward to attach the ITHA's escrow request to the motion listed on the agenda to certify the recapture amounts.

In fact, the IRB didn't even discuss the issue prior to voting 6-0 to release the recapture payments as requested by the tracks.

For Illinois' three Thoroughbred tracks, the approved recapture amounts this year will be: Arlington ($4,948,020), Hawthorne ($2,879,530) and Fairmount Park ($1,934,464).

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