Pari-mutuel gambling is not a sure economic bet, says a well-known Utah economist.
R. Thayne Robson, executive director of the Bureau of Economic and Business Research, said at a news conference Wednesday that the activity would require large out-of-state investment, public subsidies, off-track betting parlors and sizable revenues from licenses, admission, parking fees and concessions to be successful in Utah.Utahns, Robson said, would spend an estimated $15 million at the track annually - three times as much bet on-track in Wyoming and nearly double the sums wagered in Idaho.
By Robson's estimates, Utah's schools would earn only $1 per child - $450,000 - if Utahns wagered $15 million at the track.
Robson said he believes Utahns would wager in the range of $10 to $20 million per year, based on estimates derived from annual reports of the Wyoming and Idaho racing commissions, census figures and demographic studies of Utahns. Since Utahns' have large families, they would have less disposable income to wager at the race track, Robson said. Others would be discouraged from gambling because of religious beliefs that discourage the practice.
"Utah has relatively few wealthy people, lots of children and relatively low per-capita incomes. Utah people are prudent, and the majority have lifestyles that do not support gambling activity," he said.
Pari-mutuel gambling is not an economic issue, Robson said, rather an entertainment issue.
"Pari-mutuel betting will transfer relative small sums from bettors to horse owners, trainers and jockeys. It will not improve income or wealth in Utah. It is an entertainment and recreation issue and not an economic development issue," he said.
Utah voters will decide in November whether to allow gambling on horse races under a ballot initiative placed on the ballot by citizen petition drive.
Backers of the initiative drive say Utahns are subsidizing racetracks in Idaho and Wyoming and spending their entertainment money out of state.
But Robson argues that money comes back to Utah with Utah horse owners, trainers and successful bettors. "Hence, more than 80 percent of sums bet by Utahns come back to Utah."
Nationwide, the horse racing industry has fallen on tough times, Robson said. The on-track handle at racetracks in Idaho, for instance, has fallen 18 percent since 1987. In Wyoming, on-track revenues have dropped 38 percent in the same time period.
Jon Freston, a spokesman for Citizens to Put Utah First, the organization backing the initiabe drive, questioned Robson's estimates.
"With all due respect to Robson - whose family lived down the lane from us for years and I used to weed his mother's garden as a child and we've bought tons and tons of hay from their family farm - he doesn't know what he's talking about when he gets to talk about pari-mutuel horse racing."
Freston said he believes the activity can be self-sustaining without out-of -state investment. License fees alone, he said, would generate an estimated $170,000 in revenue annually.