Horse Play

[June 13th, 2007] Portland Meadows plans to install 150 new video gambling machines this summer to raise cash for the state's faltering horse-racing industry and to boost attendance at the North Portland racetrack.

Just don't call them "slot machines." Technically, they're "parimutuel insta-racing machines."

They're also one other thing: A potential siphon on profits for the Oregon Lottery, which has generated $3.6 billion since 1984 to pay for public services such as restoration of salmon habitat, schools and parks.

Since 2003, individual retailers may have up to six video lottery terminals each. Racetracks are allowed 10. But under a rubbery state provision letting the Oregon Racing Commission approve and regulate a different breed of video terminals—"parimutuel insta-racing machines"—the commission last week considered Portland Meadows' request for the 150 new machines.

If approved, the money they'll generate will go toward subsidizing horses, racing and gambling. (If they're successful, of course: Portland Meadows installed and then quickly removed 20 similar machines in 2003, but declined to give a reason.)

Once installed, the new machines will compete with the lottery's video retailers—and its list of largely unimpeachable beneficiaries. However, the commission is holding off on making a decision until legal counsel can review the proposal, according to commission vice chair Todd Thorne. Its decision has implications beyond racing.

"It's competition for the Oregon Lottery in Portland and North Portland, and it will draw away business that the lottery currently gets from the Vancouver market," says Bob Whelan, an ECONorthwest economist who has studied gambling in Oregon.

Portland Meadows lies within two-and-a-half miles of five of the top 10 video lottery retailers in Portland. That list includes Dotty's and Original Joe's, which are also the top two video lottery retailers in the entire state.

In Oregon, 97 cents of every dollar made by the lottery supports economic development projects, the environment or schools. "People accept the lottery as a part of our society in large part because of the good that it does," says Shannon Campion, Portland director of Stand for Children, a school-funding advocacy group. "I don't think there would be the same appetite for the lottery if the money it generated didn't go to areas with real social value."

The racetrack's media contact, Patrick Kerrison, declined to comment on the new machines. He referred questions to General Manager Dwayne Yuzik, who did not return multiple calls.

Portland Meadows' machines would have the same Vegas-style flash as slots—the bright lights, mind-dulling sounds and enticing payouts. Players guess results from a randomly selected horse race—one that happened long ago and perhaps far away. A cartoon video depicts the race on the machine's monitor. If the two sets of numbers match up, the gambler wins the bet.

The addition of more gambling options troubles consultant Jeff Marotta, a problem gambling expert.

"Electronic gambling machines are the most problematic form of gambling out there—outside of Internet gambling. There's a reason they're restricted," Marotta says.