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Colonial Downs has shut down its online wagering system for horse races and laid off its last employees at the New Kent County track, all but erasing its footprint in Virginia.
The decision to end the online wagering was prompted by the passage of Senate Bill 1097 in the General Assembly, according to a news release from Jacobs Entertainment, the parent company of Colonial Downs.
That bill takes money raised from online wagering that was previously mandated by law to go to the track and instead diverts it to horsemen’s groups and a nonprofit coalition of which the track would have been a part.
Colonial Downs announced in November it would shut down its sites throughout Virginia where bets were accepted on horse races both in the state and nationwide. The track had been locked into a nearly yearlong dispute with the Virginia Horseman’s Benevolent and Protective Association, which represents horse owners in the state.
State law required the track and VHBPA to agree to a racing contract for thoroughbred horse racing at Colonial Downs, the only track in the state capable of hosting the races. Without a contract, no thoroughbred racing can take place at the track, nor can bets be taken at the off-track wagering sites. The two sides were unable to agree on a contract — the track wanted fewer race days to maximize profits, while the horsemen wanted more days to maximize each owner’s chance of winning money.
The Nov. 1 closures left intact EZHorseplay, an online wagering system with a web presence and 75 kiosks around the state. But following the passage of SB1097, Jeff Jacobs, the CEO of Jacobs Entertainment, said the legislative changes would cost his company $2 million per year in lost money.
By shutting down EZHorseplay, all that will remain of the track’s footprint is the building and its grounds. The only event listed at the track for this year is a 5K run, which was scheduled for April 11.
The last thoroughbred races were held at Colonial Downs in 2013. After months of negotiating into 2014, Jacobs announced a plan to create his own horsemen’s group called the Old Dominion Thoroughbred Horsemen’s Association to try to satisfy the provision in state law requiring a deal between the track and such a group.
That group never came to fruition. Instead, the negotiations dragged on through 2014 until Jacobs announced the Nov. 1 closure. That cost at least 177 jobs between the track in New Kent County and the eight wagering sites across Virginia.
Jacobs said in the news release that SB1097 appears to be a bid by the state to give VHBPA a chance to setup thoroughbred racing elsewhere in the state.
“The 800-pound gorilla in the room is the fact that Virginia’s thoroughbred horses cannot compete against most horses from other states,” Jacobs said. “That is why they do not race often in other states, and when they do race it is often at the lowest available purse level. To me this explains why the VHBPA was so strongly opposed to our efforts to hold high-end races with nationally competitive horses at Colonial Downs. They can’t compete at that level.”
SB1097 creates a process for regulating horsemen’s groups. The bill gives the Virginia Racing Commission, which oversees horse races in the state, the power to name an official horsemen’s group. Though the bill passed the General Assembly, it was returned with modifications by Gov. Terry McAuliffe, who wants the bill to allow the nonprofit coalition to operate a track if no other entity has stepped forward by Aug. 1.
It is now up to both the House of Delegates and Senate of Virginia to approve or deny McAuliffe’s recommendations. Should the bill be signed into law, it becomes effective July 1.
Colonial Downs and VHBPA had worked together successfully for 17 years prior to the contract disagreement. The closure of the track has all but ended thoroughbred horse racing in Virginia, with limited opportunities still available in the spring and fall at the Golden Cup in Fauquier County.