Betting on a windfall from unique merger
The operator of the Arapahoe Park racetrack has a plan to boost business: allow people to bet on professional athletes much like they bet on horses.
Mile High Racing & Entertainment has won approval from the Colorado Racing Commission to offer fantasy sports betting at its Aurora track and at its nine offtrack betting parlors across the state. But it’s not like the fantasy sports betting that has swept the country in recent years, exploding into a billion-dollar industry. This new fantasy sports plan — the first of its kind outside Nevada, where it was approved this year — merges traditional horse racing parimutuel betting, odds and terminology with professional football and basketball.
Instead of assembling a fantasy team, gamblers pick athletes to win, place or show. They can pick groups of athletes for a daily double or trifecta — say, the top-five quarterbacks or receivers on any given Sunday, or the top scoring guards during a stretch of NBA games.
Rather than betting on a horse to win, a gambler can bet that Tom Brady throws for more yards than any other NFL quarterback on game day.
Eventually, backers hope to expand fantasy betting beyond football and basketball into hockey, baseball, golf and NASCAR. It’s a new approach to gambling that horse track operators across the country hope can revive the waning sport of kings.
“This can help what we do at the racetrack and can bring more people in the doors and help us grow a year-round audience,” said Jonathan Horowitz, the announcer at Arapahoe Park, which is operated by Mile High Racing & Entertainment. “It’s exciting and new, and it’s never been done before. Maybe it can become a model for other racetracks around the country.”
Colorado’s once-bustling horse and dog racing scene has floated a variety of strategies over the past 15 years to keep afloat. Colorado voters and legislators have rejected several of those proposals, refusing to expand Colorado gambling with slotlike video lottery terminals at Front Range racetracks and businesses.
This time the state’s sole remaining horse track is hoping to ride the surging fantasy sports wave. While not nearly as vibrant as it was decades ago, Arapahoe Park and the nine off-track betting locations saw $85.5 million in parimutuel bets on 363 days of simulcast horse and dog races and 39 days of live horse racing at the Aurora horse track in 2015, down from a statewide total of $219.2 million in 2002.
In June, the Nevada Gaming Commission approved the new form of fantasy sports betting, which was developed by Vic Salerno, a gaming pioneer and member of the Gaming Hall of Fame. Salerno’s Las Vegas-based USFantasy Sports is partnering with Mile High Racing to bring his fantasy sports betting to nine locations in Colorado, including Havana Park in Aurora, Red & Jerry’s in Sheridan and off-track betting parlors in Fort Collins, Greeley, Colorado Springs, Grand Junction and Pueblo, and two in Denver.
“This is a significant step forward for USFantasy Sports and we are excited about the Colorado market and our potential for growth within the state,” Salerno said in a news release. “We look forward to continuing our expansion across the United States.”
This year, Colorado legislators crafted a bill that regulates the booming pay-to-play billion-dollar fantasy sports leagues that are banned in some states, where they are seen as a form of gambling. The law requires licensed league operators to allow regular audits and background checks and keep records of daily operations. League operators must register with the new Office of Fantasy Contests, a branch of the Colorado Department of Regulatory Agencies.
Legislation governing fantasy sports betting in Colorado goes into effect July 1. Mile High Racing already has a state regulatory framework that allows parimutuel betting. The company is expanding parimutuel betting to include professional athletes. The Colorado Racing Commission in September approved the USFantasy Sports partnership with Mile High Racing.
“Colorado regulates what we do at Arapahoe Park, so we already have a framework in place to make sure everything is above board and fair,” Horowitz said.
The legislation signed by Gov. John Hickenlooper in June specifically says fantasy sports contests are allowed at licensed facilities such as casinos, as well as horse tracks and parlors licensed for parimutuel betting.
That specific wording was what prompted Mile High Racing to pursue the deal with USFantasy Sports, Horowitz said.
Mile High Racing must secure a license from the Department of Regulatory Affairs before the new fantasy sports legislation takes effect July 1, said Colorado Department of Revenue spokeswoman Lynn Granger.
Colorado’s casinos are not embracing the new betting strategy, arguing this is not really fantasy sports betting as defined by the state’s fantasy sports bill.
“The bill doesn’t allow parimutuel wagering in fantasy sports,” said Lois Rice, executive director of the Colorado Gaming Association, which represents 21 casinos in Colorado’s three gaming towns. The state’s casino industry — alongside the national gaming industry — supported a regulatory framework that could allow casinos to develop fantasy sports betting.
Because parimutuel prizes are determined by the size of all the bets made and the new law requires that prizes be outlined before bets are placed, the association thinks this new form of fantasy sports betting is illegal.
“The games proposed here cannot meet this straightforward and important requirement,” Rice said. “No form of gambling is legal until it’s approved by either the legislature or the voters, and that hasn’t happened here. The track doesn’t get to invent its own exception to the law just because they wish the law was different.”