Home Entertainment New Mexico horse-racing tracks see drop in slot revenue

New Mexico horse-racing tracks see drop in slot revenue

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SANTA FE, N.M. (AP) — Revenue from slot machines at New Mexico horse-racing tracks has declined to its lowest point since the opening of the state’s newest track in 2005, but no one is quite certain what’s driving the drop.

State economists expect the slot revenue at tracks to continuing dropping over the next five years as the revenue from tribal casinos is expected to grow only slightly, The Santa Fe New Mexican reported.

The net win from track slots during the last fiscal year was about $226 million, according to figures from the New Mexico Gaming Control Board. The amount was down from $241 million the previous year and down from about $265 million in 2015. The net win is the amount gambled minus the amount paid in winnings.

State Sen. John Arthur Smith, one of the state’s top finance experts, said the decline is tracking with a decline in the lottery, indicating that the state gambling industry has matured.

During the last fiscal year, proceeds from the New Mexico Lottery were $37.8 million — the lowest recorded in a decade and down from $46.3 million in 2016. New Mexico Lottery officials expect its proceeds to continue to decline unless state lawmakers give flexibility to increase prize sizes and reduce contracting costs with vendors.

With the drop in slot revenue, the state is also receiving less in taxes. The state received $58.9 million from the last fiscal year — down nearly $10 million from 2015. From fiscal year 2006 to 2015, slot revenue at tracks grew nearly 16 percent, which all disappeared last year and this year.

As the energy industry saw a decline in recent years, some point to that as a possible cause. The tracks in Hobbs and Farmington are in oil- and gas-producing areas. Ismael Trejo, the executive director of the New Mexico Racing Commission, said a lot of people have lost high-paying jobs in the sector and have moved from these areas.

The decline of slot revenue may also be a blow to horse breeders, owners and others in the racing because 20 percent of that revenue funds race purses. The amount paid by the tracks into race purses dropped by nearly $8 million from 2015 to 2017.

Some tracks have reduced the number of race days, which has kept the purse levels up, Trejo said. But the reduction in races was primarily driven by a shortage of competitive horses.

Patrick Bingham, executive director of the New Mexico Horsemen’s Association, said purses in the state have remained competitive to ones outside the state.
Information from: The Santa Fe New Mexican, http://www.sfnewmexican.com

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