Listen to this articleKEY TAKEAWAYS:
- Churchill Downs signals intent to surrender Fair Grounds license
- Louisiana Supreme Court ruling deemed HHR machines unconstitutional
- CDI cites lack of legislative support and economic viability
- Two bills on gambling expansion passed without CDI’s backing
Down the stretch they don’t come? The future of horse racing in New Orleans is in jeopardy as the parent company of the legendary Fair Grounds Race Course & Slots has doubled down on its intent to pull out of the city.
Kentucky-based Churchill Downs, Inc. (CDI) sent a letter to state legislators saying that the company is taking preliminary steps to voluntarily surrender its Fair Grounds license due to a recent court ruling, adverse state legislation, and stalled negotiations, all leading to a lack of economic viability.
The Thoroughbred Daily News obtained CDI’s letter, signed by CDI CEO Bill Carstanjen and sent to the Louisiana State Racing Commission (LSRC), cc’ing high-ranking state politicians.
“Given the legislature’s ease with which it approved legislation that is directly adverse and harmful to the economic interests of Fair Grounds, the opposition by elected officials to engage in meaningful solutions in collaboration with the Fair Grounds, and the forthcoming adjournment of the legislative session, CDI is left with no choice but to request an appearance before the LSRC to begin the next steps for voluntarily surrendering the racing license held by the Fair Grounds,” wrote Carstanjen.
Churchill Downs acquired the Fair Grounds out of bankruptcy in 2004. For 21 years, CDI has operated both the racetrack and its on-site casino. The Gentilly site has been the home to New Orleans horse racing since approximately the 1850s, making it the third oldest racetrack in the United States. It was formerly known as Union Race Course, and the name changed to the Fair Grounds in 1863.
There are several factors at play in CDI’s preliminary decision to voluntarily surrender its Fair Grounds license. The downturn began in March when the Louisiana Supreme Court affirmed a lower court’s ruling that Historical Horse Racing (HHR) machines are unconstitutional without acquiring local voter approval in every parish in which they are located. HHR machines – which enable wagers on random video replays of past horse races – contribute significantly to CDI’s revenue and after-tax profit in Louisiana, accounting for 46% and 74% respectively. In addition to the
Gentilly casino site, CDI operates 13 off-track betting (OTB) outlets.
The Louisiana Supreme Court ruling led to a CDI attorney appearing before the Louisiana Racing Commission in May, notifying commissioners that CDI would not proceed with the 2025-26 season (November-March) unless the state legislature would assist the company in working around the court’s ruling. That workaround was not reached.
CDI officials became further irked by two bills that were passed in the House and Senate. House Bill 540, signed by the President of the Senate on June 10, would increase the number of video poker machines at truck stops from 50 to 60 and enable bars and restaurants to operate up to four video poker machines, as opposed to the previous amount of three. Louisiana House Bill 547, currently awaiting Gov. Jeff Landry’s approval, seeks to legalize fixed odds wagering on horse races within the state. The bill also proposes a purse supplement fund, allocating 55% to Thoroughbreds, 24% to Quarter Horses, 14% to the Louisiana Thoroughbred Breeders Association, and 7% to the Louisiana Quarter Horse Breeders Association for breeder awards.
The letter continued: “For the last few months, CDI has attempted to engage in good faith discussions with elected officials and various other industry stakeholders to find a path toward long term economic viability for the Fair Grounds after the recent decision of the Louisiana Supreme Court that resulted in the elimination of HHR and nearly half of the Fair Grounds’ off-track betting (OTB) revenues,” wrote Carstanjen. “To date, our efforts to engage elected officials have not led to meaningful discussions and, confoundingly, CDI’s efforts have been met with a combination of reluctance, indifference, apathy, and even opposition.”
In recent years, citing loss of profitability issues, CDI has also ceased racing at Arlington Park in Illinois, and Calder Race Course in Florida.
(Except for the headline, this story has not been edited by PostX News and is published from a syndicated feed.)
