Santa Fe New Mexican

BACK ON TRACK

Applicants for state’s sixth racino hope to give economic boost to struggling Tucumcari, but face opposition, competing bids in Clovis

- By Thom Cole tcole@sfnewmexic­an.com

WTUCUMCARI arren Frost’s field of dreams is 330 acres on the east edge of town.

The land is mostly mesquite, cactus and scrub grass. Someone planted three towering steel white crosses. There also is an old horse barn. Interstate 40 runs along the southern edge of the property.

Frost has a grand vision for the land: a horse-racing track, a casino with 600 slot machines, restaurant­s, a lounge and more.

He says Tucumcari, with its boarded-up Kmart and other shuttered businesses along historic Route 66, needs a shot in the economic arm — including the jobs, increased tourism and additional spending at local businesses that a track and casino would produce.

“We’d like to have Apple, but we’re a little more realistic than that,” Frost says.

The lawyer from nearby Logan is a member of a group that plans to apply this month for a horse-racing license from the New Mexico Racing Commission. It will have competitio­n from at least two other groups that plan to make separate proposals for a track in the Clovis area.

The Racing Commission announced in May that it was accepting applicatio­ns for

what would be New Mexico’s sixth racing license. The applicatio­n deadline is July 30.

The commission says it plans to issue the license before the year’s end, which means the plum would be handed out before Gov. Susana Martinez leaves office Dec. 31. The governor appointed all five racing commission­ers.

Given the high financial stakes and the political connection­s of the racing applicants — as well as those seeking to halt the licensing of another track — the proceeding­s before the Racing Commission promise to be hard fought.

“It’s going to be a fierce competitio­n.” Warren Frost, attorney and horse-racing license applicant

“It’s going to be a fierce competitio­n,” Frost says.

The five existing tracks raked in an average of $45.3 million from their slot machines in the year that ended June 30, 2017.

The state, in compacts with American Indian tribes with casinos, has agreed to cap at six the number of tracks with slot machines, or so-called racinos. In exchange for limiting offreserva­tion gambling, the state gets a cut of the tribes’ take from their slots.

If the Racing Commission follows through on its plans, it will be the second time that it has issued a sixth racing license.

In 2008, the commission awarded the license to a group that planned to build a racino in Raton. That project collapsed two years later following repeated constructi­on delays and persistent questions about its financing.

The Martinez administra­tion in 2011 issued a new lease for the Downs Racetrack & Casino in Albuquerqu­e to continue to operate at the state fairground­s, a decision that was criticized as rushed and politicall­y tainted.

Politics at play

The three groups that have announced plans to apply for the new racing license each include major campaign contributo­rs to Martinez, a Republican. Their political connection­s also extend beyond donations.

All the existing racinos, with the exception of the Sunland Park Racetrack & Casino, have asked the Racing Commission to halt its process of issuing the license. The Fulton family, owner of Sunland Park, has announced it will seek the sixth license for a racino in Clovis.

The tracks that want a delay in the licensing process or their owners also have made substantia­l political donations to Martinez and have other connection­s to the governor.

“I always like to see the gambling interests fight each other. It’s a lot of fun,” says Guy Clark, chairman of Stop Predatory Gambling New Mexico, which is marshaling opposition to the sixth license.

Clark, a Corrales dentist, says neither Tucumcari nor Clovis needs the kind of economic and social problems that go along with gambling, including bankruptci­es, crime and more.

Gaming tribes, major political players in New Mexico, will have their say about the sixth license as well. Under Racing Commission regulation­s, the commission must “carefully and seriously” consider the views of gaming tribes prior to issuing the license, including potential economic impacts on the tribes’ casinos.

Northeaste­rn New Mexico doesn’t have any gaming tribes or racinos. But in the southeaste­rn part of the state, there are racinos in Ruidoso Downs and Hobbs, and one gaming tribe, the Mescalero Apaches, just outside Ruidoso.

Delay sought

The group that receives the sixth racing license from the Racing Commission will have to apply to the state Gaming Control Board for a slot machine license.

But the existing racinos in Albuquerqu­e, Ruidoso Downs, Farmington and Hobbs want the licensing process halted pending study by the commission, according to the minutes of a June meeting of the panel.

The tracks were represente­d by lawyers well known to the Martinez administra­tion and in political circles.

Albuquerqu­e attorney Marcus Rael Jr., a former appointee of Martinez to the New Mexico Lottery board, represente­d the racinos. In the June meeting, he cited Racing Commission regulation­s that say the commission, in issuing a racing license, “may consider the following factors: public interest, health of the industry, safety and welfare of the participan­ts.”

At the same meeting was Hal Stratton, a former Republican state attorney general, who appeared on behalf of Zia Park Casino Hotel & Racetrack in Hobbs, according to the minutes.

Ismael “Izzy” Trejo, executive director of the Racing Commission, says the commission never formally voted to seek applicatio­ns but did discuss the matter in sessions closed to the public.

The Racing Commission had received inquiries about the sixth license in the last couple of years, Trejo says.

“I suppose there was enough interest to trigger” the applicatio­n request, he says.

The announceme­nt by the Racing Commission that it planned to issue the sixth license came four years after the end of litigation stemming from the failed Raton racino. The Raton group unsuccessf­ully sued the commission after losing its racing license.

The cost of a new racino is projected at about $70 million to $80 million.

Raton Mayor Neil Segotta says he isn’t aware of another applicatio­n being prepared for a track in Raton.

Coronado Partners, the company that includes Frost, first proposed a Tucumcari track in 2008 but lost out to the Raton group.

Frost says politics drove the selection of the Raton group but says he isn’t sure what role it will play in the new competitio­n for the sixth license. He adds: “I have a lot more faith in our governor than I did 10 years ago.”

 ?? THOM COLE/THE NEW MEXICAN ?? Attorney Warren Frost walks the proposed site of a horse-racing track and casino on the edge of Tucumcari. The site sits in a triangle formed by Interstate 40, historic Route 66 and U.S. 54.
THOM COLE/THE NEW MEXICAN Attorney Warren Frost walks the proposed site of a horse-racing track and casino on the edge of Tucumcari. The site sits in a triangle formed by Interstate 40, historic Route 66 and U.S. 54.
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 ?? THOM COLE/THE NEW MEXICAN ?? The town of Tucumcari is best known for its section of historic Route 66 and the motor inns along the road. But Kmart and other businesses along the route have been boarded up in recent years, a sign of Tucumcari’s economic struggles.
THOM COLE/THE NEW MEXICAN The town of Tucumcari is best known for its section of historic Route 66 and the motor inns along the road. But Kmart and other businesses along the route have been boarded up in recent years, a sign of Tucumcari’s economic struggles.

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