HomeMy WebLinkAbout15.A.1 Racino Resolution-Res. No. 6233
IS: IJJ.
CITY OF SHAKOPEE
Memorandum
TO: Mayor and City Council
FROM: Mark McNeill, City Administrator
SUBJECT: Racino Resolution
DATE: April 28, 2005
INTRODUCTION:
The Council is asked to adopt a resolution stating its support for the establishment of a
Racino at Canterbury Park.
BACKGROUND:
At the worksession of April 19th, Randy Sampson, of Canterbury Park, appeared before
the City Council to outline Racino legislation. At that time the Council did state support
for the establishment of a Racino at Canterbury, as long as it is consistent with the
provisions of House File 1664. In that support, it would be for only a Racino at
Canterbury, and that 1 % of the adjusted gross gaming machine revenues proceeds would
go to both Scott County and the City of Shakopee (Section 17 C).
Since that time, a great deal of activity has taken place atthe Legislature; the most recent
version was for a second casino to be established at Canterbury. Two of three northern
Indian tribes have declined to be part of this. On Thursday, April 28th, the Mayor and I
both received a call from Chief of Staff Dan McElroy of Governor Pawlenty'soffice.
We relayed to him the general perception that there is . little if any support locally for a
second casino at Canterbury - there are too many unknowns, and there is a general
concern about placement of a tribally-operated casino that close to Mystic Lake. There is
also a concern about future Fee to Trust requests that might be filed.
The Governor's Office still desires to see action to locate a northern-tribes casino at
Canterbury (in addition to the Racino). A representative of Governor Pawlenty's office
will be in attendance at the May 3rd City Council meeting to answer questions about the
Governor's proposal.
Assuming that the Racino is still a viable option as of the City Council meeting of May
3rd, the Council will be asked to adopt a resolution supporting a Racino at Canterbury. If
there is a desire to express support for the Governor's option (both a Casino and Racino
at Canterbury), modification of the resolution will be needed.
RECOMMENDATION:
If the Council wishes to express its support for a Racino, the attached resolution should
be adopted.
ACTION REQUIRED:
If the Council concurs, it should, by motion, adopt the following resolution:
RESOLUTION NO. 6233
A RESOLUTION OF THE CITY COUNCIL OF
THE CITY OF SHAKOPEE, MINNESOTA, STATING
SUPPORT FOR A RACINO AT CANTERBURY PARK
M'~~
Mark McNeill
City Administrator
MM:th
RESOLUTION NO. 6233
A RESOLUTION OF THE CITY COUNCIL OF
THE CITY OF SHAKOPEE, MINNESOTA, STATING
SUPPORT FOR A RACINO AT CANTERBURY PARK
WHEREAS, the City of Shakopee has been host to pari-mutuel betting since the
opening of Canterbury Downs in 1985; and
WHEREAS, since 1992, Canterbury Park has operated successfully and
cooperatively with the City of Shakopee under the current management; and
WHEREAS, Canterbury Park now hosts a Card Club, which has allowed
additional forms of wagering within the community; and
WHEREAS, Canterbury Park is a well run facility that has been a positive
attribute to the Shakopee community and Scott County; and
WHEREAS, legislation has been introduced in 2005 which would allow the
additional operation of slot machines (a "Racino") at Canterbury Park; and
WHEREAS, the establishment of a Racino at Canterbury is viewed as being
supported by the majority of Shakopee residents; and
WHEREAS, other legislation introduced in 2005 has proposed a separate Casino
to be operated for the benefit of Native American Tribes from outside the Metropolitan
Area on property at Canterbury Park; and
WHEREAS, the concerns about unlrnowns created by the separate casino are too
numerous, and are of enough concern that the City Council is not supportive of the
establishment of a second Casino on Canterbury property.
NOW, THEREFORE, BE IT RESOLVED BY THE MAYOR AND COUNCIL
OF THE CITY OF SHAKOPEE, MINNESOTA, that it hereby states its strong support
for legislative authority to establish a Racino at Canterbury Park, assuming that the
provisions of House File 1664 are incorporated in to the operating plan;
BE IT FURTHER RESOLVED that the City Council of the City of Shakopee,
Minnesota does not favor the proposed establishment of a separate Casino on Canterbury
property.
Adopted in regular session of the City of Shakopee, Minnesota, held this
day of , 2005.
Mayor of the City of Shakopee
ATTEST:
City Clerk
-----
Racino At Canterbury Park
"The Vision))
I
I
j The vision for the Racino at Canterbury Park is broader than slot machines and tax revenue. Much broader. If
passed, Canterbury Park would undergo a privately financed $120 million construction project that would feature
the addition of a 250-room hotel and conference center overlooking the racetrack, a world-class equestrian center
featuring two indoor show venues and a trio of outdoor arenas, and a cross-country jumping course on the current
racetrack infield.
The images are available for download on CD or via the web at www.mn-racino.com
~ - ----
The eXlstmg Canterbury ,
Park grandstand on t~e right N I I r"1.:.J
connected by an atnum to ~j , /"'\' ,/
the new 250-room hotel, ~N}' J Ii ~
conference center and
~";""- ili,250-ro=fi"lT.mIM,] -~
r","= ,"",f, boI,oo;~ wh= - (' _ =- _ __
guests can comfortably view I' _
morning workouts as wel.1 as " t" '
almost feel the racmg acllon ~ 4"_
An overhead shot looking ..... I
west at Canterbury Park with \
a view of the new hotel and
casino in the foreground and Inside the main track and turf
the horse park arenas and course, the infield features a
stalls in the background. beautifully landscaped cross
country course. Television
coverage of competitions will be
shown on screens throughout the 1
entire complex.
- r:-~ - -'~I
A bronze statue of a three- v.lf$ ~k.W "" 1'," ~4_,w:'{-;,
horse stretch run leads visitors
along the main promenade to A show horse entertains the ..' , -'.' . i
the entrance Ihat connects the d t th Id I _ ,z~~~4..~,.,# .i.I'j""fI' ~Qf'
crow a e new wor .0 ass ~i!"W'~ .,~. I~", ~ '-. ....~
grandsland with the casino, h h f: 'I't Th R . .t..?J...~ d. ~'-=.', ,.:,,~
orse s ow aOlI y. e acma 1- . ",- __~"" :1..:,""",
hotel and conference center. proposal includes two indoor and " '~~ ~
three outdoor show arenas as
~'" j well as a Western show arena
. and cross-country course.
II
Floor to ceiling windows
inside the Casino's full menu
restaurant provide patrons
with an up close preview of A giant flying horse is
the horses on post parade to suspended over the main floor of
the track. the Casino gaming area. Large
video screens provide customers
with coverage of Canterbury
races and action from tracks
around the country.
I
H.F.No. 1664, 1st Engrossment - 84th Legislative Session (2005-2006) Page 1 of 10
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H.F. No. 1664, 1 st Engrossment - 84th Legislative Session (2005-2006) Posted on Mar 31 , 2005
1.1 A bill for an act
1.2 relating to gambling; providing for lottery gaming
1.3 machinesi authorizing the. director of the.. State
1.4 Lottery to contract for placement of gaming mac;hinesi
1.5 establishing horse 'racing purse paymentsiimposing a
1.6 tax on gaming machine and card club revenue; providing
1.7 powers and duties to thedirectori authorizing
1.8 blackjack and other card gamesiamendingMinnesota
1.9 Statutes 2004, sections 240.13, by adding a
1.10 subdivisioni 240.15, subdivision Ii 240.30,
1.11 subdivision 8i 240.35, subdivision Ii 299L.07,
1.12 subdivisions 2, 2ai' 340A.410, subdivision 5i 349A,01,
1.13 subdivision 10, by adding subdivisionsi 349A.I0,
1.14 subdivision 3i 349A.13i 541.20i 541.21i 609.75,
1.15 subdivision 3i 609.761, subdivision2i proposing
1.16 coding for new law in Minnesota Statutes, chapters
1.17 297Ai 349A.
1.18 BE IT ENACTED BY THE. LEGISLATURE OF. THE' STATE OF. MINNESOTA:
1.19 Section 1. Minnesota Statutes 2004, section 240.13, is
1.20 amended by adding a subdivision to read:
1. 21 Subd. 5a. [PURSESi GAMING MACHINES.] . From the commission
1.22 received by a licensee pursuant to a gaming machine location
1. 23 contract entered into under'section349A.17, the licensee must
1.24 set aside an amount equal.to not,lessthan'7.25 percent of.the
1. 25 adjusted gross gaming machine revenues as defined under chapter
1. 26 349A, . for purses for live horse races conducted by the
1.27 licensee. Purse paymen.ts made pursuant to this subdivision are
1. 28 in addition to' purse payments otherwise ,established by law or
1.29 contract. Twentypercent of the money set aside for purses
1.30 pursuant to this subdivision shall be transferred to .the
1. 31 commission and used for the purposes in'section240.18,
2.1 subdivisions 2, paragraph (d), and 3, paragraph (b), subject to
2.2 the proportionality requirement in section 240.18,. subdivision
2.3 1. The licensee and the horseperson's organization representing
2,4 the majority of horse persons who have raced at the racetrack
2.5 during the preceding 12 months may negotiate percentages
2.6 different from those stated in this section if the agreement is
2.7 in writing a.nd filed with the .racing commission.
2.8 Sec. 2. Minnesota Statutes 2004, section 240.15,
2.9 subdivision 1, is amended to read:
2.10 Subdivision 1. [TAXES IMPOSED.] . (a) There is imposed a tax
2.11 at the rate of six percent of the amount in eXcess of
2.12 $12,000,000 annually withheld from all pari-mutuel pools by the
2.13 licensee, including breakage and amounts withheld under section
2.14 240.13, subdivision 4. For the purpose of this subdivision,
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H.P. No. 1664, 1st Engrossment - 84th Legislative Session (2005-2006) Page 2 of 10
2.15 "cmnually" is the period from July 1 to June 30 of the next year.
2.16 In addition to the above tax, the licensee must designate
2.17 and pay to the commission a tax of one percent of the total
2.18 amount bet on each racing day, . for deposit in. the Minnesota
2.19 breeders 'fund.
2.20 The taxes'imposed by this clause must be paid ,from. the
2.21 amounts permitted to be withheld by a licensee under section
2.22 240.13, subdivision 4.
2.23 (b) The commission may impose an admissions tax of not more
2.24 thanten'cents on each paid admission at a licensed racetrack on
2.25 a racing day if:
2.26 (1) the taxis requested by a local unit of ,government
2.27 within whose borders the track is located;
2.28 (2) a public hearing is held on'the request; and
2.29 (3 ) the commission finds that the local unit of government
2.30 requesting the tax. is in need of its revenue to meet
2.31 extraordinary expenses caused by the racetrack.
2.32 (c) There is imposed a tax at the rate of five percent on
2.33 amounts annually received from charges authorized under section
2.34 240.30, subdivision 4, less amounts set aside for purse payments
2.35 and the breeders fund" as required by section 240.135.
2.36 Sec. 3. Minnesota Statutes 2004, section 240.30,
3.1 subd{vision 8, is amended to read:
3.2 Subd. 8. [LIMITATIONS.] The commission may not approve any
3.3 plan of operation under subdivision 6 that exceeds any of the
3.4 following limitations:
3.5 (1) tl:l.9 ];!md..,.l1m 19."mQgrgf t391gg "r;;9GlfG1:"9:ArGl pl:;l:'Tll9.g :At
3.6 t);;).g 9:H9 gl"~ :At 2l9.:,Tgl9.9 timg, gt);;).gr t);;).:;lR t29lgg "g9gf9T
3.7 in~t~nctiQR, ggmgR~tr~tiQR~, ,Qr tQ"rR~,mgRt. Fl?~/ I mi:/.RQt ,Q~(~gQ'g
3.8 5Q , ,T);;).9 t:A.919 limit g]W9pti9R fgr tgYTmm9Rt pby ir;; :Allg~TgGl .
3.9 fgr 9Rly 9l9.9 t9"rR:Am9l9.t p9r :/9:AT t);;).2tbgtfl f2T 19.9 19R~9T t);;).2R
3.10 14 ,b::,Tr;;j
3.11 ~ except as provided in clause~ ill, no wager may
3.12 exceed. $60;
3.13 ~ill for games in which each player is allowed to make
3.14 only one wager or has a limited opportunity to change that
3.15 wager, no wager may exceed $300.
3.16 Sec. 4. Minnesota Statutes 2004, section 240.35;
3.17 subdivision 1, is amended to read:
3.18 Subdivision 1. [GENERALLY.] A licensee of the commission
3.19 may detain a person if the licensee,has probable cause to
3.20 believe that the person detained has violated section 609.76
3.21 while at a card club authorized by section 240.30 or at a
3.22 facility where. gaming machines are located under,section
3.23 349A.17. For purposes of this section, "licensee" means the
3.24 commissiqn's director of racing security or a security officer
3.25 ,licensed under Minnesota Rules, chapter 7878.
3.26 Sec. 5. [297A.651] [LOTTERY GAMING MACHINES; IN-LIEU TAX.]
3.27 Adjusted gross revenue from the operation of gaming
3.28 mCichinesauthorized under chapter 349A are. exempt from the ,tax
3.29 imposed under section'297A.62. The State Lottery must on or.
3.30 before the 20th day of each month transmit to the corrunissioner
3.31 a.n amount equal to the adjusted gross revenue from the operation
3.32 bfgaming machines,. as defined in section 349A.Ol,. 'for the
3.33 previous month multiplied by 35 percent. The commissioner shall
3.34 deposit the money transmitted under this paragraph in the state
3.35 treasury in the general fund.
3.36 Sec. 6. Minnesota Statutes 2004, section 299L.07,
4.1 subdivision 2,. is amended to read:
4.2 Subd. 2. [EXCLUSIONS.] Notwithstanding subdivision 1, a
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H.P. No. 1664, 1st Engrossment- 84th Legislative Session (2005-2006) Page 3 of 10
4.3 gambling device:
4.4 (1) maybeseld by a persen who. is net licensed under this
4.5 sectian, iithe persan (i) is nat engaged in the trade er
4.6 business ef selling gambling devices, and (ii) dees net sell
4.7 mare than anegambling, device in any calendar year ;
4.8 (2) may be seld by the geverning bady af a federally
4.9 recagnized Indian tribe described in subdivisien 2a, paragraph
4.10 (b), clause (1), which is nat licensed under this sectian,if
4.11 (i) the gambling device was operated by the Indian tribe,(ii)
4.12 the sale is to. a distributar licensed under this secj:ien,and
4.13 (iii) the licensed distributar natifies the cammissiener af the
4.14 purchase, in the same manner as is required when the licensed
4.15 distributar ships a gambling device into. Minnesata;
4.16 (3) may bepassessedby a persan net licensed under this
4.17 sectian if the persan heldsa'permit issued under section
4.18 299L.08;,~
4.19 (4) may be pessessed by a state agency, with the written
4.20 autherizatian af the director, fer display ar evaluatien
4.21 purpases anly andnat far the canduct afgambling; and
4.22 (5) may be pessessedbythe State Lettery asautherized
4.23 under ,chapter 349A.
4.24 Sec. 7. Minnesata Statutes 2004, sectian 299L.07,
4.25 subdivisio.n 2a, is amended to. read:
4.26 Subd. 2a. [RESTRICTIONS.] (a) Amanufacturer licensed
4.27 uhder this sectian may sell, offer to. sell, lease, ar rent, in
4.28 whele ar in part, a gambling device anly to. a distributer
4.29 licensed under this sectianer to.. the State Latteryas
4.30 autharized under chapter 349A.
4.31 (b) A distributer licensed under this sectien may sell,
4.32 affer to. sell, market, rent, lease, ar etherwise previde,in
4.33 whale ar in part, a gambling device anly to.:
4.34 (1) the gaverning bady af a federally recagnizedIndian
4.35 tribe that is autherized to. operate the gambling deviCe under a
4.36 tribal state campact under the Indian Gaming Regulatery Act,
5.1 Public Law 100-497, and, future amendments to. it;
5.2 (2) a persan far use in the persan 'sdwelling far display
5.3 ar amusement purpasesin a manner thatdees nat affard players
5.4 an appartunity taebtain anything ef value;
5.5 (3) anather distributer licensed under this sectian; ~.
5.6 (4) a persanin another state who. is autharize<;lunder the
5.7 laws of that state to. possess .the gambling device; or
5.8 (5) " the State Letterv' as autherized under chapter 349A.
5.9 Sec. 8. MinnesetaStatutes 2004, sectian340A.410,
5.10 subdivisian 5, is amended to. read:
5.11 Subd. 5. [GAMBLING PROHIBITED.] , (a)' Except as atherwise
5.12 pravidedil1 this subdivisianr no. .retail establishment licensed
5.13 to.. sell alcahalic beyeragesmay keep, possess, ar eperate, ar
5.14 permit the keeping, po.ssessian, ar eperation an the licensed
5.15 premises of dice arany gambling device as defined in sectio.n
5.16 349.30, or permit gambling therein.
5.17 (b) Garriblingequipmentmaybe keptaraperated and raffles
5.18 cenducted an licensed premises and adjainingreems when the use
5.19 af the gambling equiprnent is autharized by{l} chapter 349, (2)
5.20 a tribal ardinance in canfarmitywiththe Indian Gaming
5.21 Regulatery Act, Public Law 100-497, ar (3}a tribal-state
5.22 cempact autharized under sectian3.9221-
5.23 (c) Lattery tickets maybe purchased and sold within the
5.24 licensed premises as autherized by the directo.r of the lettery
.5.25 under chapter 349A.
5.26 (d) Dice maybe kept and usedo.n licensed premises and
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H.P. No. 1664, 1st Engrossment - 84th Legislative Session (2005-2006) Page 4 of 10
5.27 adjoining rooms as authorized by section 609.761, . subdivision 4.
5.28 (e) ,Gambling devices may be operated on the premises of a
5.29 licensed racetrack as authorized by chapter 349A.
5.30 Sec. 9 , Minnesota Statutes 2004, section 349A.01,
5.31 subdivision 10, is amended to read:
5.32 Subd. 10. [LOTTERY PROCUREMENT CONTRACT.] "Lottery
5.33 procurement contract" means a contract to provide lottery
5.34 products, gaming machines, maintenance of" gaming machines,
5.35 computer hardware and software used ,to monitor sales of lottery
5.36 tickets and gaming machine plays, and lottery tickets. "Lottery
6.1 procurement contract" does not include a contract to provide an
6 .2 annuity or prize payment agreement or materials, supplies,
6.3 equipment, or services common to the ordinary operation of a
6.4 state agency.
6.5 Sec. 10. Minnesota Statutes 2004, section 349A..01 f is
6.6 amended by adding a subdivision to read:
6.7 Subd. 14. [GAMING MACHINE.] "Gaming machine" means any
6.8 machine, system, or device which" upon payment of consideration
6.9 in order to playa game, may award or entitle a player to a
6.10 prize by reason of skill of the player or application of the
6.11 element of chance, or both.
6.12 Sec. 'II. Minnesota Statutes 2004, section 349A.01, is
6.13 amended by adding a subdivision to read:
6.14 Subd. 15. [GAMING MACHINE GAME.]' "Gaming machine, game"
6.15 means a game operated by a gaming machine as authorized by the
6.16 director.
6.17 Sec. 12. Minnesota statutes 2004, section 349A:Ol.is
6.18 amended by adding a subdivision to read:
6.19 Subd. 16. [GAMING MACHINE PLAY.] "Gaming'machine play"
6.20 means an electronic record that proves participation in,a gaming
6.21 machine game.
. 6.22 Sec. 13. Minnesota Statutes 2004, section 349A.D1, is
6.23 amended by adding a subdivision to read:
6.24 Subd. 17. [ADJUSTED GROSS GAMING MACHINE REVENUE,]
6.25 "Adjusted gross gaming machine revenue" means the'sum of all
6.26 money received by the' lottery for.gaming'J;l\achine,plays, less.the
6.27 amount paid out in prizes for gaming machine games.
6.28 Sec. 14. Minnesota Statutes 2004, section 349A.10,
6.29 subdi vision 3, is amended to read:
6.30 Subd. 3. [LOTTERY OPERATIONS.] (a) The director shall
6.31 establish a lottery operations account in the lottery fund. The
6.32 director shall pay all costs of operating the lottery, including
6.33 payroll costs or amounts transferred to the state treasury for
6.34 payroll costs, but not including lottery prizes, from the
6.35 lottery operating account. The director shall credit to the
6.36 lottery operationsaccol.lnt amounts sufficient to pay the
7.1 operating costs of the lottery.
7.2 (b) Except as provided in paragraph (el, the director may
7.3 not credit in any fiscal year thereafter amounts. to the lottery
7.4 operations account.whichwhen totaled exceed 15 percent of gross
7.5 revenue ,to the lottery fund in that fiscal year; Incomputing
7.6 total amounts credited to the lottery operations account under
7.7 this paragraph, the, director shall disregard amounts ., transferred
7.8 to or retained by lottery retailers as" sales commissions or
7.9 other compensation and amounts '.. transferred' or" retained by' a
7.10 racetrackpursuanttoa location contract under section 349A.17.
7.11 (c) The director of the lottery may not expend after July
. .. .
7.12 1,1991, more than 2-3/4 percent of gross revenues in a fiscal
7.13 year for contracts for the preparation, publication, and
7.14 placementbf adverj:.ising
. . . ~
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H.P. No. 1664, 1st Engrossment - 84th Legislative Session (2005-2006) Page 5 of 10
7.15 (d) Except as the director determines, the lottery is not
7.16 subject to chapter 16A relating to budgeting, payroll, and the
7.17 purchase of goods and services.
7.18 (e) In addition to the amounts credited to the lottery
7.19 operations account under paragraph (b), the director is
7.20 authorized, if necessary, to meet the current obligations of the
7.21 lottery and to credit up to 25 percent of an amount.equal to the
7.22 average annual amount which was authorized to be credited to the
7.23 lottery operations account for the previous three fiscalyears
7.24 but was not needed ,to meet the obligations of the lottery.
7.25 (f) Notwithstanding the provisions of this subdivision, the
7.26 director may not credit, in any fiscal year, to the lottery
7.27 operations account which when totaled exceed ten percent of
7.28 adjusted gross revenue from the operation' of gaming machines at
7.29 the gaming facility.
7.30 Sec. 15. Minnesota Statutes 2004, section 349A.I0,
7.31 subdivision 6, is amended to read:
7.32 Subd. 6. [BUDGET; PLANS.] The director shall prepare and
7.33 submit a biennial budget plan to the commissioner of. finance.
7.34 The governor shall recommend the maximum amount available for
7.35 the lottery in the budget the governor submits to the
7.36 legislature under section 16A.l1. The maximum amount available
8.1 to the lottery for operating ,expenses and capital expenditures
8.2 shall be determined bylaw; Operating expenses shall not
8.3 include expenses that are a direct function of lottery sales,
8,4 which include the cost of lottery prizes, amounts paid to
8.5 lottery retailers as sales commissions or other compensation,
8.6 amounts paid to produce and deliver scratch lottery games, ~
8.7 amounts paid to an outside vendor to operate, and maintain an
8.8 online gaming system,arnounts paid to an outside vendor to
8.9 operate and maintain a central system for gaming machines ,and
8.10 for otherlottery.games, and amounts paid to. acquire. and
8.11 maintain gaming machines and equipment used to conduct other
8.12 lottery games. In'addition, the director shall appear at least
8.13 once each fiscal year before the senate and house of
8.14 representatives committees having jurisdiction over gambling
8.15 policy to present and explain the lottery's plans for future
8.16 games and the related advertising and promotions and spenqing
8.17 plans for the next fiscal year.
8.18 Sec. 16. Minnesota Statutes 2004, section 349A.13, is
8.19 amended to read:
8.20 349A.13 [RESTRICTIONS.]
8.21 Nothing in this chapter:
8.22 (1) authoriz,es the director to conduct a lottery game or
8.23 contest the winner or winners of whichareo.eterminedbythe
8.24 result of a sporting event other than a horse race conducted
8.25 under chapter 240;
8.26 (2) authorizes the director to install or operate a lottery
8.27 device operated by coin or currency which when operated
8.28 determines the winner of a game except as authorized under
8.29 section 349A.17jand
8>30 (3) authorizes the director to sell pull-tabs as defined
8..31 under section 349.12, subdivision 32.
8.32 Sec..17. [349A.17] [GAMING MACHINES.]
8.33 subdivision T. [LOCATION CONTRACT.J (a) The director may
8.34 enter into a contract with a person to provide locations for
8.35 gaming.rnachines. Contracts entered'into under this ,section are
8.36 notsubj ect to chapter ,16C. . The director may only enter a
9;1 contract under this'subdivision.withaperson that holds a class
9.2 A'license under chapter 240. .The gaming machines may only be
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H.F.No. 1664, 1st Engrossment - 84th Legislative Session(2005-2006) Page 6 of 10
9.3 placed at the racetrack for which the class A license under
9.4 chapter 240 was issued.
9.5 (b) In order., to be eligible for a contract under this
9.6 section, the , c1ass A licensee must have conducted at least 50
9.7 days of live racing at the racetrack each year within the last
9.8 five preceding calendar years. A contract under this section
9.9 must contain a provision under which the contract terminates on
9.10 the first day of any calendar year following a calendar year
9.11 during which the class A licensee'hasnotconducted at least 50
9.12 days of live racing at the licensee's racetrack.
9.13 (c). Contracts' entered intomust'provide for compensation to
9.14 the racetrack in an amount equal to at least 55 percent of
9.15 adjusted gross gaming machine revenue. From the amount received
9.16 by the racetrack under this section, the racetrack shall
9.17 annually remit an amount equal to'one percent of the adjusted
9.18 gross> gaming machine revenue to'both'the city or ,town and the
9.19 county where the racetrack is located.
9.20 (d) The director may cancel, ,suspend, or refuse to renew
9.21 the location contract or impose a civil'penalty,ifthe person:
9.22 (1) no longer holds a class A license under chapter 240;
9.23 (2) fails to account for proceeds from the gaming machines;
9.24 (3) fails to remit funds to the director in accordance with
9.25 the location contract;
9.26 (4) violates a law, rule, or.order of the director;
9.27 (5) fails to comply with any of the terms of the. location
9.28 contract; or
9.29 (6) has acted in a manner prejudicial to public confidence
9.30 in the integrity,of.the operation of the gaming machines.
9.31 The cancellation, suspension, or refusal to renew the
9.32 location contract or imposition ofa civil penalty under this
9.33 paragraph is a contested case under sections 14.57 to 14.69.
9.34 (e) NO gaming machines may be located within a home rule
9.35 charter or statutory city, .ortown, unless ,the governing body of
9.36 the city or town adopts a resolution approving the location " of
10.1 the gaming machines wi thin the ci ty or town.
10.2 (f) As a condition of entering into a contract1.lnderthis
10.3 section, the person' holding ,a class A license under chapter 240
10.4 must make to the racing cormnission,fordeposit.in the general
10.5 fund, a onetime payment of $100,000,000 by June 30, 2007. A
10.6 contract must include a provision to refund this payment if this
10.7 section,is repealed by the legislature, revoked by
10.B constitutional amendment,.or held unconstitutional by a court of
10.9 competent]urisdiction.
10.10 (g) The contract entered into under '" this section must
10.11 provide, for the following provisions:
10.12 .' (1) ,Liquidated damages to recover the initial investment by
10.13 the licensee in the event the state, through legislation or
10.14 constitutional amendment, revokes all.or substantially all,of
10.15 the forms of gambling authorized under. this section. The
10.16 liquidated damages may not be greater than the unpaid balance of
10..17 any debt incurred by.the licensee after the 'location contract
10.18 has been executed ,and is limited to the debt incurred by ,the
10.19 licensee for the gaming ,facility license, initial construction,
10.20 or acquisition of the gaming facility less the present market
10.21 value of the property or other assets related to the debt. Any
10.22 liqUidated damages provision must expire within ten years.
10.23 (2)' All costs. associated with managing the' day-to-day .
10.24 activity of gamingmadlines, inc1uding,but not ,limited to,
10.25 routine and minor service and maintenance, security monitoring,
10.26 verifying winners, paying winners, collecting ;money from gaming
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10.27 machines, and advertising and marketing of gaming machines shall
10.28 be borne by the licensee.
10.29 Subd. 2. [OPERATION.] (a) All gaming machines that are
10.30 placed at>a racetrack pursuant to subdivision 1 must be operated
10.31 and controlled by the director.
10.32 (b) Gaming machines must be owned or leased by the director.
10.33 (c) Gaming machines must be maintained by the lottery, or
10.34 by a vendor that is under the control and direction' of the
10.35 director.
10.36 (d) The director must have a central communications system
11.1 that monitors activities on each gaming machine. The central
11. 2 communications system must be located at a lottery office;
11.3 (e)' The director must approve the general security
11.4 arrangements associated with and relating to the operation of
11 . 5 the gaming machines. .
11 . 6 . (f) Advertising and promotional material' produced
11. 7 racetrack relating to gaming machines located at its
11.8 must be approved by the director.
11.9 (g) All gaming machines must be accessible to individuals
11.10 with disabilities. For the purposes of this subdivision,
11.11 "individuals with disabilities" includes any person who has a
11.12 physical or' sensory.' impairment which materially limits one or
11.13 more major life activities.
11.14 (h) A reasonable number of gaming machines 'that are placed
11.15 at a racetrack pursuant to subdivision 1 must afford players the
11.16 option to receive winnings in the form or either coins or tokens
11.17 rather than in the form of a paper receipt. , ,.
11.18 (i) The director may implement such other-'controls as are
11.19 deemed necessary for the operation of gaming machines pursuant
11.20 to this section.
11.21 Subd.3. [GAMES .]The director shall specify the games
11.22 that may be placed onagaming machine as set forth under
11.23 section 349A.04, Gaming machines. may conduct pari-mutuel
11.24 wagering and display horse races pursuant to specifications set
11.25 forth by the director.
11.26 Subd.4 . . [PRIZES .]A person who' plays a gaming machine
11.27 agrees>to be bound 'by the rules and game procedures. applicable
11. 28 to that particular gaming machine game. The player acknowledges
11.29 that the determinatioIl of whether the player has won a prize is
11.30 subjectto'the rules and game procedures . adopted by the
11.31 director, claim procedures established by the director for the
11. 32 game, and any confidential or public validation tests
11.33 established by the director for that game. A prize claimed from
11.34 the play of a gaming machine game is not subject to the
11.35 provisions of section 349A.08, subdivision 8.
11. 36 Subd. 5. [PROHIBITIONS.] (a) A person under the age of 18
12.1 years may not playa game on or claim a prize from a gaming
12.2 machine.
12.3 (b) The director or any employee of the lottery, ora
12.4 member of their immediate family residing ,in the'same household,
12.5 maynot.play a game on a gaming machine or receive a prize from
12.6 the operation of,a'gaming machine.
12.7 ,Subd. 6. [COMPULSIVE GAMBLINGiREPORT.] (a) The licensee
12.8 shall prominently post, in the area where the gaming,machines
12.9 are located, the toll-free telephone number established by the
12.10 commissioner of human services in connection with the compulsive
12. n gamb1~ng program es.t~plishedunder section 245. 9B. . The
12.12 licensee, with the approval of the director, shall establish a
12.13 proactive plan relating to problem gambling.
12.14 (b) By January 15 of each year, the director shall submit a
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12.15 report to the legislature, of not more than, five pages., in
12.16 length, setting forth the performance objectives of the plan and
12.17 the progress that was made toward those objectives during the
12.18 prior calendar year. The licensee may establish a
12.19 self__exclusionprogram by which persons, at their request, may
12.20 be excluded from the facility where the gaming machines are
12.21 located. .
12.22 Subd. 7.. [LOCAL LICENSES.] Except as' provided . in
12.23 subdivision 1, no political subdivision may require a license to
12.24 operate a gaming machine, restrict or regulate the placement of
12.25 gaming machines, .or impose a tax or fee on 'the business of
12.26 operating gaming machines.
12.27 Subd. 8. [REIMBURSEMENT; RACING COMMISSION.] The racing
12.28 commission under section 240.02 shall require the licensee to
12.29 reimburse the commission's actual costs, including personnel
12.30 costs, 'of regulating the licensee under this sect,ion. Amounts
12.31 received under this subdivision must be deposited as provided in
12.32 section 240.155, subdivision 1.
12.33 Sec. 18. Minnesota Statutes 2004, section 541.20, is
12.34 amended .,' to read:
12.35 541. 20 [RECOVERY OF MONEY LOST.]
12.36 Every person who, by playing at cards, dice, or other game,
13 .1 or by betting on the hands or sides of such as are gambling,
13 .2 shall lose to any person so playing or betting any sUm of money
13.3 or any goods, and pays or delivers the same, or any part
13 .4 thereof, to, the winner, may sue for and .recover such money by a
13.5 civil action, before any court of competent jurisdiction. For
13.6 purposes of this section, gambling shall not include pari-mutuel
13.7 wagering or other wagering conducted under a license issued
13.8 pursuant to chapter 240, purchase or sale of tickets in the
13 .9 state lottery, or gambling authorized under, chapters 349 and
13 .10 349A.
13.11 Sec. 19. Minnesota Statutes 2004, section 541. 21, is
13.12 amended, to read:.
13.13 541. 21, [COMMITMENTS FOR GAMBLING DEB.T VOID. ]
13 .14 Every note, bill, bond, mortgage,' or other security or
13.15 conveyance'inwhich the. whole or any. part. of, the consideration
13.16 shall be for any money or goodS won by gambling or playing at
13 .17 cards, dice, or any other game whatever, or by betting on the
13 .18 . sides or hands of, any. person gambling ,or for reimbursing or
13 .19 repaying any money knowingly lent or advanced at the time and
13 .20 place of such gambling or betting, or lent and advanced for any
13.21 gambling or betting to any persons so gambling or betting" shall
13 .22 be void and of no effect as between the parties to the same, and
13.23 as to all persons except such as hold or claim under them in
13 .24 good faith, without <notice of the illegality of the
13,25 consideration of such contract or conveyance. The provisions of
13 .26 this section. shall not apply to: (1) pari-mutuel or other
13.27 wagering conducted under a license issued pursuant to chapter
13 .28 240 (2) purchase of tickets in the state lottery or other
13 .29 wagering authorized under chapter 349A; (3) gaming activities
13 .30 conducted pursuant, to the Indian Gaming Regulatory Act, 25
13 .31 U.S.C. 2701 et seq.; or (4) lawful gambling .activities permitted
13 .32 under chapter 349.
13.33 Sec. 20. Minnesota.Statutes 2004, section 609.75,
13.34 subdivision 3, is amended to read:
13 .35 Subq, 3. ,[WHA',I'AR,E NOT BETS.] .The following are not bets:
13.36 (l)A contract to insure, indemnify, guarantee or otherwise
14.1 compensate another for a .harrri or. loss sustained, even though the
14.2 loss. depends upon chance.
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14.3 (2 ) A c,ontract for the purchase or sale at a future date of
14.4 securities or other commodities.
14~5 (3) Offers of purses, prizes or premiums to the actual
14.6 contestants in any bona fide contest for the determination of
14.7 skill, speed, strength, endurance, or quality or to the bona
14.8 fide owners of animals or other property entered in such a
14.9 contest.
14.10 (4) The game of bingo when cOnducted in compliance with
14.11 sections 349.11 to 349.23.
14.12 (5) A private social bet not part of or incidental to
14.13 organized, commercialized, or systematic gambling.
14.14 (6) The operation of equipment or the conduct of a raffle
14.15 under sections 349.11 to'349.22, by an organization licensed by
14.16 the Gambling Control Board or an organization exempt from
14.17 licensing under section 349.166.
14.18 (7) Pari-mutuel betting on horse racing when the betting is
14.19 conducted under chapter 240.
14.20 (8),The purchase and sale of state. lottery tickets and
14.21 plays on a gaming machine under chapter 349A.
14.22 Sec. 21- Minnesota Statutes 2004, section 609.761,
14.23 subdivision 2, isarnended to read:
14.24 Subd. 2. . [STATE LOTTERY.] Sections 609. 755 and 609.76 do
14.25 not prohibit the operation of the state lottery or the sale,
14.26 possession" or purchase of tickets for the state lottery under
14.27 chapter 349A, ,or the manufacture, possession, sale, or operation
14.28 of a gaming machine under chapter 349A.
14.29 Sec. 22. [OTHER GAMES.]
14.30 (a) The Minnesota Racing Commission may authorize a person
14.31 with a gaming machine location contract under Minnesota
14.32 Statutes, section 349A~17, to conduct other card games that
14.33 Indian gaming casinos within this state are authorized by
14.34 compact or law to conduct. The Mirmesota Racing Commission
14.35 shaH adopt game procedures and take other' actions necessary to
14.36 regulate the conduct and ensure the integrity of the games.
1~.1 (b) A tax is imposed on games conducted under this section,
15.2 at the rate of 20 percent of the gross gaming receipts from the
15.3 conduct of the games . For, purposes of this section, gross
15.4 gaming receipts means' all revenue received by a gaming facility
15.5 as.wagers On gambling activities, or'as payment for chips or
15.6 tokens usedil1 gambling activities ,at the casino, ,less amounts
15.7 paid out by the casino as winnings and for the redemption of
15.8 chips or tokens.' Gross gaming receipts, do ',' not include (1)
15.9 adjusted gross gaming machine revenue from gaming machines
15.10 operated by the lottery director, or (2) receipts from chips or
15.11 tokens that have been purchased but have not.been redeemed or
15.12 won back by the casino.
15.13 (c) From the revenue received from games authorized under
15.14 this section, the licensee must'set aside an amount equal to not
15.15 less than 7.25 percent of the gross gaming receipts for purses
15.16 for live, horse races conducted by the. licensee.' Purse payments
15.17 under this section are in addition to any other purse payments
15.18 established by law or contract. Twenty percent of the money set
15.19 aside 'for purses shaH be ,transferred to the Minnesota Racing
15.20 Commission and used for the purposes in Minnesota Statutes,
15.21 section 240.18. The licel1seeand the horseperson'sorganizatiOn
15.22 representing the majority of horsepersons who have raced at the
15.23 racetrack during the Preceding 12 months may negotiate
15.24 percentages different from those stated in. this. section if the
15.25 agreement is in writing and filed with the racing commission.
15.26 Sec. 23. [LOTTERY BUDGET; . GAMING FACILITY.]
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H.F. No. 1664, Ist Engrossment - 84th Legislative Session (2005-2006) Page 10 of 10
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15.27 The director oLthe state Lottery shall submit a budget for
15.28 the operation of gaming machines at a gaming facility as
15.29 authorized under Minnesota Statutes, section 349A.17,' to the
15.30 commissioner of finance. Notwithstanding Mimiesota Statutes,
15.31 section 349A.I0, \ subdivision 6, the director of the State
15.32 Lottery, may expend amounts necessary to operate.gaming at the
15.33 gaming facility. Amounts expended by the director of the State
15.34 Lottery for the conducting of gaming at the gamingfacility'in
15.35 fiscal years 2006 and 2007 are not subject to the maximum amount
15.36 set.in law for the operation of the lottery.
16.1 Sec. 24. [SEVERABILITY; SAVINGS.]
16.2 If,anypart of this act is found to be invalid because it
16.3 is in conflict with a provision of the Constitution of the state
16.4 of Minnesota or the Constitution of the United States, or for
16.5 any other reason, all ' other provisions of this act shall remain
16.6 valid and any rights, remedies, 'and privileges that have been
16.7 otherwise accrued by this act, shall remain in effect and maybe
16.8 proceeded with and concluded under the provisions of this act.
16.9 Sec. 25. [EFFECTIVE DATE.]
16.10 This act is effective the day following final enactment.
Please direct all comments concerning issues or legislation
to your .!-louse Membe[ or State Senator.
For Legislative Staff or for directions tothe Capitol, visit the .Contact Us page.
General Questions or comments.
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CANTERBURY PARK
Racino at Canterbury
H.F. No. 1664
Bill Summary & Analysis
Delete-all Amendment (A05-0267)
This bill authorizes the State Lottery to operate gaming machines ~ video.or electromechanical slot machines
- on the premises of a licensed racetrack and allows the track to conduct blackjack card games. Proceeds
from the operation of the gambling activities will be used to pay foE purchase and maintenance of the
machines, oversight activities conducted by the Lottery and use of the racetrack facilities where the machines
are to be located,
Thttty-fivepercent of the "adjusted gross gaming machine revenues," twenty percent of the revenues from
blackjack and five percent of the existing card club rake will be deposited each month into the state general
fund.
The racetrack will receive at least 55 percent of the adjusted gross revenues; From this amount, 7.25 percent
of the total adjusted gross revenue will be set aside for purses for live horse races conducted at the track,
including an amount exclusively for Minnesota bred horses. In addition, the local city and county where the
track is located will each receive 1 percent of the adjusted gross revenue.
The gaming machines used by the lottery must by certain specifications for recording and monitoring of
machine activity. Persons under the age of 18 may not playa game on or claim a prize from a gaming
machine. Lottery employees are prohibited from playing the machines. The lottery director must give notice
of where compulsive gambling assistance is available. .
Section~by~section analysis
Section 1. "Requires the. licensed racetrack that is the gaming machine location provider' to set aside an
amount equal to 7.25 percent of the "adjusted gross gaming machine revenues" for purses for live horse races
conducted by the licensee. These payments are in addition to all others required by law or contract Twenty
percent of the money set aside must be transferred to the racing commission for administration through the
breeder's. fund. These amounts may be changed through negotiations between the racetrack and the majority
horsemen's association.
Sec. 2. Imposes a tax of five percent on charges rake and seat charges from the card club, less amounts set
aside for racing purses.
Sec. 3. Removes the limit on the maximumnllmber of card tables allowed ata card club locatedata
racetrack
Sec. 4. Allows licensees of theRacingCommission to detain persons who have committed gamblingcrirnes
at the facility where gaming machines are located.
Sec. 5. Exempts the gross revenue from the operation of the gaming machines fromstatesale taxation.
However, 35 percent of the proceeds must be deposited each month into thestate generalfund
,
.
Sec. 6. Excludes the state lottery from the statutory prohibition on possession of a gambling device.
Sec. 7. Allows a licensed manufacturer to sell a gambling device to the state lottery.
Sec. 8. Allows gambling devices to be operated on at a licensed racetrack where liquor is served.
See~ 9. Allows the state lottery to enterinto contracts to procure gaming machines and provide for their
maintenance and monitoring.
Sec. to. Defines "gaming machine" as any machine in which a coin or other currencyis deposited to, playa
game that uses a video display and microprocessors or electromechanical devise with a spinning reel. .
See 11. Defmes "gaming machine game" to mean a game operated by a gaming machine as authorized by the
state lottery director.
Sec. 12. Defmes "gaming machine play" tomean an electronic record that proves participation in a gaming
machine game. .
Sec. 13. DefInes "adjusted gross gaming machine revenue" to mean the sum of all money received in gaming
machine play less the amount paid out in prizes.
Sec. 14; As with payments made to ,lottery retailers, allows the director to, deduct, amounts paid' to the
racetrack under the location contract before crediting a maximum 10 percent of that annual gross lottery
revenue to the lottery operations account.
Sec. 15. Excludes from the calculation of lottery's operating budget amounts paid to outside vendors for the
operation and maintenance of a gaming machines and other lottery games.
Sec. 16. Amends the restrictions on what activities the state lottery may conduct to include the useof gaming
machines as provided in this act. .
Sec. 17. Provides requirements for the location of and specifIcations for gaming machines operated by the
state lottery as follows:
Subdivision 1: iocation Contract. Provides that the lottery director may contract for location of
gaming machines with a class A racetrack that has conducted at least 50 days of live racing in the preceding
five calendar years. The racetrack license holder is to be paid an amount equal to not less that 55 percent of
the adjusted gross gaming machine revenue. From that amount the racetrack must pay one percent to both
the dty and county where the racetrack is located. The lottery direCtor may fIne, cancel, suspend, or refuse to
renew a location contract if the track loses its class A license, fails to account for machine proceeds, fails to
remit funds, violates laws or directors orders, fails to meet the terms of the locations, contract or jeopardizes
the public confIdence in the operation of the machines.
Requires the local unit of government to adopt a resolution ()f support approving the location of the gaming
machines.
Requires the licensee,byjune.30, 2007, to make a one-time payment of $100,000,000 to the racing
commission for deposit in the general fund upon' entering into a location contract. ' If the legislature repeals
the statute or it is found unconstitutional, the payment must be refunded to the licensee.
Requires that the . location contract, include a liquidated '. damages, contract '.' to recover any, initial investment
made by the licensee if the state or a court revokes the authority for the lottery to conduct these newly
authorized gambling, activities. The qamages will amount., to, no. more than the unpaid balance on any
outstanding debt incutred to build the gambling facility. This provision expires after ten years.
Costs associated with routine day-to-dayoperation of the gambling machines are to be borne by the track.
,
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Subd. 2: Operation. Requires machines to be operated, controlled, and owned or leased by the
lottery. ,Requires them to be maintained by 'the lottery or a lottery contractor. Requires a central.
communications system that ,monitors each machine. Requires the lottery to approve general security
arrangements. Requires lottery to approve all advertising related to machines.
Subd. 3. Games. Requires. the director to specify the' games played on gaming machines, " including
horse racing.
Subd. 4. Prizes. Provides that players are bound by the rules and game procedures for any particular
gaming machine game. The director alone is authorized to determine prize winners subject to these rules.
Subd. 5. Prohibitions. Prohibits persons under age 18, and the lottery director and lottery
employees and their immediate families, from playing gaming machines.
Subd. 6. Compulsive gambling notice. Requires the licensee to post the compulsive gambling
hotIinenumber at gaming machine locations. The licensee must also develop a proactive plan relating to
problem gambling. The director must report to the legislature each year on the plan's objectives and progress
being made toward dealing with problem gamblers.
Subd. 7. No local license. Prohibits political subdivisions from licensing, regulating, or taxing
gaming machines.
Subd. 8. Reimbursement to racing commission. Requires the racing commission to require the
class A licensee to reimburse the commission forits costs of regulating the facility.
Subd. 9. Allows the director to collect proprietary data on the internal operations ofthe gaming
machines. This data is. classified nonpublic. The directbr may provide the data to the licensee or a vendor
subject to a confidentiality agreement.
Sec. 18. Recovery of money lost. Exempts gaming machine play from the law that allows persons to sue
to recover gambling losses.
Sec. 19. Gambling debts void. Exempts gaming machine play from the law that makes gambling debts
void.
Sec. 20. Exemption from gambling laws. Adds gaming machine plays to the list of gambling activities that
are not bets for purposes of state laws that prohibit gambling.
Sec.21. State Lottery. Exempts manufacture, possession, sale, and operation of gaming machines from anti-
gambling laws.
Sec. 22. Other games. Allows the licensee to conduct other card games. that Indian 'gaming casinos within
the state are authorized to conduct. . Twenty' percent of the adjusted gross revenue from the games is to be
paid to the state. Of the amount retained by the licensee, 725 percent is to be paid out as purses for live
horse races.
Sec. 23. Lottery Budget. Requires the director to submit a budget for the operation of gaming machines
and othedottery conducted, at the racetrack. However, the director is allowed to expend those' amounts
necessary to operate any new facility in fiscalZ006 ...,. 2007without being subject to existing budget limitations.
Sec. 24. Severability. Provides that if any provision of the bill is found unconstitutional or otherwise invalid
all other provisions remain in effect.
Sec. 25. Effective date. Makes all sections' effective immediately.
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EXECUTIVE SUMMARY OF
MARKET STUDY FOR
A PROPOSED CASINO A T
CANTERBURY PARK
Shakopee, Minnesota
January 2005
PREPARED FOR:
Canterbury Park Holding Corporation
PREPARED BY:
GV A MARQUE'ITEADVISORS
333 South 7th Street
Suite 2300
Minneapolis, Minnesota 55402
Telephone: (612) 344-1309
Fax: (612) 334-3022
.
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Proposed Racino at Canterbury Park
Shakopee. Minnesota Paee 1
EXECUTIVE SUMMARY
The State of Minnesota's casino history began with high stakes bingo halls on several. Native
American reservations in the 1980's, which grew into casinos after the signing of compacts
with the State in 1991. Today, the state has 19 operating Indian casinos with a total of 22,200
gaming positions (one table counts as seven positions).
Minnesota's sole racetrack, Canterbury Park, is seeking to construct and operate aracino at the
track. The track presently offers simulcast wagering throughout the year and has successfully
operated a cardroom for the last five years.
LOCATION
Canterbury Park is locatedj ust off Federal Highway 169 in Shakopee, a rapidly growing suburb
in the southwest comer of the metropolitan area, Highway 169 provides excellent access to the
I/494/694 beltway that encircles the Twin Cities, as well as to Interstates 35 and 94.
RECOMMENDED RACINO FACILITIES
The proposed racino will share the market with several successful Native American casinos, so
that it must offer high quality facilities and supporting amenities. Based on the scope of
competitive development and the size of the' market available to the subject racino, we
recommend the following racino facilities:
. 3,000 slot machines
. 40 Blackjack tables
. Buffet restaurant with approximately 250 to 300 seats
. 200-seat coffee shop open 24 hours a day
. Snack bar
. Entertainment-oriented restaurant and. lounge with , approximately
250 seats, offering brief entertainment evenings on the hour.
. Gift shop
. 250-Room Hotel
. 15,000-Squarefeetofmeeting and banquet space
In conjunction with the proposed racino, an Equestrian & Agricultural Event Facility is
planned for the racetrack that will include a 3,000-seat indoor arena with two show areas, four
outdoor show arenas, a cross country course and supporting horse barns. The facility will be
GV A Marquette Advisors International Hospitality & Gaming Consultants
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Proposed Racino at Canterbury Park
Shakopee. Minnesota Pal!e 2
capable of hosting regional and national horse shows with a projected attendance of45,000 in
its third year of operation.
DEMOGRAPHIC CHARACTERISTICS
The Twin Cities is surrounded by a large, mostly rural area, so that it functions asa
commercial center for a very largetrade area. There are 3.2 million people withinSO miles,
4.3 million within 100 miles and 7.3 million within 200 miles. The population within 50
and 100 miles is projected to increase by approximately 5 percent over the next five years.
The, median household income within 50 miles is relatively high at $58,400 and these
households spend approximately $5.4 billion on entel1ainment and food away from home.
The Twin Cities is a popular destination for visitors from the region and' throughout the
country. The convention centers in both cities attracted 554,000 delegates in 2003. The
area's many tourist attractions and its four professional sports teams draw, millions of
visitors annually, which represenfan additional pool of gaming demand.
REGIONAL GAMING INDUSTRY
For purposes of our analysis the subject racino'sprimary market is defined as the population
that lives within 50 miles of Canterbury Park in Shakopee. The area between 50 and 100 miles
of the proposed racino is considered to be the secondary competitive market. The Canterbury
racino is expected to occasionally draw from greater distances, particularly due to the rural
nature of much of Minnesota and Iowa and the strength ofthe Twin Cities as an entertainment
destination. Therefore, thesubjecfracino's regional competitive market includes the 200-mile
surrounding area that represents a' reasonable daytrip distance.
The scope of gaming within the state ,is significant. While the Indian casinos are not required to,
report revenues, the state is able to support 19 casinos with a total of 20,000 slot machines and
400 table games. Canterbury Park reported simulcast handle of $63 million and live on-track
racing handle of$18 millionin 2003. The Minnesota State Lottery reported annual gross
receipts of nearly $362 millionin 2004 and more than $1.3 billion in pull-tabs were sold.
International Hospitality & Gaming Consultants .
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Proposed Racino at Canterbury Park
Shako pee. Minnesota Page 3
GAMING DEMAND FACTORS
The amount of gaming demand that exists in a market isa function of the following major
factors:
. Population
. Income
. Quantity of gaming facilities
. Quality and amenities of gaming facilities
. Proximity and convenience of gaming facilities
. Variety and quality of entertainment alternatives
In evaluating the potential gaming market available for the proposed racino, each. of these
factors were weighed in relation to the particular characteristics of the market.
COMPETITIVE GAMING FACILITIES
The existing primary gaming competition for the Canterbury racino consists of three Native
American casinos within 50 miles of Shakopee.Six more Native American casinos within
approximately 100 miles represent secondary competition. 'Additional, but greatly reduced,
competition for the proposed racino will come, from eight more Native American casinos
located within 200 miles. These include casinos in Wisconsin 'and Iowa.
FUTURE GAMING MARKET
We do not anticipate any new Native American casino 10cationswiUopenwithin the market
area. However, the existing casinos could expand at any time. Should another new casino
or racino be authorized inthe metropolitan area, the demand for the subject racino would'be
diluted and consequently its performance and tax revenues would be lowered..
The addition of the recommended number of gaming devices at the Canterbury Park racino
would create the market conditions summarized in the table. below.
GV A Marquette Adviso.rs
,
Proposed Racino at Canterbury Park
Shako pee. Minnesota Pa\?:e 4
Table 1
PROJECTED COMPETITIVE MARKET
Pr t
50 Miles 8,200 11,500
200 Miles 29.500 32.800
Population per Position
50 Miles 395 296
200 Miles 249 231
*one table e uals 7 ositions
Source: GVA Mar uette Advisors
HOTEL ANALYSIS
Hotels affiliated with casinos typically operate in a'different manner,than non-casino hotels.
The hotels are usually ancillary facilities - they exist to serve casino patrons and boostcasino
demand, so they do not necessarily compete for the lodging demand present in the market area
for other reasons~ Because casino hotels are designed to attract gaming patrons, their primary
competitors are other casino hotels, and their success is inextricably tied to the success of the
gaming operation. Casino hotels serve as a marketing tool, with their performance dictated in
large part by management decisions in relation to the competitive environment in the gaming
market.
There exists a supply of 772 rooms within traditional hotels in and around Shakopee that are
available to support theracino. There are eight hotels with a total of 586 rooms in Shakopee;
one 75-room hotel in adjacent Savage and,Chaska has two hotels with a total of 1 n rooms. In
the Shakopeemarket, the subjecthotelwould seek to capture some. of the area's tourists, as they
represent a new pool of potential gaming dollars. , Similarly, the hotel would develop group
business as well. The extenttowhich theracino hotel will marketto these sectors of lodging
demand in the future depends on its ability to attract alternative' gaming patrons ,who typically
spend more thando either tourists or people that attend group or social functions.
All but one of the prim.ary and secondary. competitive casinos. have hotels. Room ratesatthese
hotels range from $59 to $109 and increase $10 to $20 on weekends. Deep rate discounts are
also typically available during slow business periods.
The competitive casino hotels would not disclose occupancy data. The occupancy of a casino
hotel is, determined mostly' by the casino's marketing efforts. That )s, through various
promotional packages, discounts and outrightcomps, the casino can control the occupancy at
the hotel. In our experience, we have found that casino hotels in rural areas generally achieve
annualoccupancies in the 70 to 75 percent range, while casinos located in or<near a large
population are typically able to achieve and annualoccupancyof80 to 85 percent.
IntemationalHospitality & Gaming Consultants
,
Proposed Racino at Canterbury Park
Shakooee. Minnesota Paee 5
HOTEL UTILIZATION
Based on the results of our market study,' we estimate' that a 250-room hotel located at
Canterbury Park and supportedby an effective marketing program utilizing its player club,
could achieve an 85 percent annual occupancy by its third year of operation.
In most markets, casino hotels are able to command higher room rates than most of the area
hotels. We feel that the recommended hotel should be able to achieve room rates above
those at traditional hotels in the' immediate area and more, in line with the casino. hotels in
the market area. On this basis, we expect the planned hotel could achieve a $92, average
rate,in current dollars.
PROJECTED GAMING MARKET PERFORMANCE
Any projection of futute market performance involves comparisons, either with existing market
performance or other gaming markets. There are two primary methods for, making the
necessary comparisons to develop future, market projections. Both. methods rely upon, key
demographic information and other market factors to identify those comparisons most relevant
and to adjustthe input to reflect the unique characteristicsof the subject market.
One method relies primarily on comparisons to actual gaming win statistics in the existing
market orin other comparable markets. 'Adjustments are made for differences in demographic
characteristics, tourism potential, competition and other factors, to yield projections offuture
gaming win, The advantage of this method is its reliance on actual, verifiable data, namely
actual gaming revenue figures, as the key input in the comparison.
The other' common method is a comparison of the underlying factors which drive market
performance: what proportion of the area's population are ,likely to participate in' casino
gaming, how frequently will they gamble, and how much will they spend on their visits to the
casinos. In this analysis technique, adjustments are made to the experience of comparable
gaming markets that reflect local differences in the population base, level of competition and
other key factors present in the subjectmarket. These adjusted factors yield a sequence of inputs
that produce the' estimate of future market performance." The advantage .of this method is the
greater .'level., of analysis of the underlying factors that actually, drive performance" thereby
reducing the risk of missing a key difference between the subject market and others used in the
comparison.
In order to assess the likely future gaming market conditions in which the proposed racino
will operate, we performed both a comparative analysis and a participation analysis.
GV A Marquette Advisors' International Hospitality & Gaming COl1sultants
.
Proposed Racino at Canterbury Park
Shakopee. Minnesota Paee 6
COMPARATIVE ANALYSIS
With nearly 4.6 million residents within 100 miles when theracino opens, the Twin Cities
market has a significant demographic base upon which to draw. Other sources of gaming
, demand are the tourists, conventioneers and business travelers that visit the metropolitan area.
Based upon these considerations ,and a, comparative analysis of the local and regional" markets
presented in Appendix E, we project the future market performance (four casinos' within the
. primary market: Mystic Lake, Little Six" Treasure Island, Canterbury) to' be approximately
$200 per gaming position per day in 2009.
Based upon the future number of gaming positions expected to be available in the primary
market, estimated to be about 1 1,500, the projected total gaming win in2009 is estimated to be
approximately $839, million.
PARTICIPATION RATE ANALYSIS
The amount of gaming win which any population base can generate can be defined.. as the
product of the propensity of that population to gamble (the proportion of the people that will
gamble), the frequency of their gambling (visits per year) and the average amount they will
spend at each visit (or conversely the average win per visit for the facility). The first two of
these factors: propensity and frequency can be combined into a single participation rate,
producing anestimate of the number of gaming visits that the designated population base
will produce in a given year.
In evaluating the Twin Cities market, the following factors were considered:
. The existence of three gaming facilities in the metro area and. six more in the region
means that the participation rate of the population is expected to, be" relatively' high
cOlnpared to communities where fewer gaming venues exist. .
. However, the broad array of entertainment alternatives available in the Twin Cities and
the'many outdoor activities, means that the participation rate tends to reduce somewhat
the local. participation rates in 'gaming, compared to communities where .less
entertainment exists.
. The area's tourist industry 'and active convention industry injects, additional. gaming
demand into the market.
Based upon our analysis of the, market we have projected the following performance factors for
the primary gaming market (four casinos within 50 miles, including Canterbury racino):
GV A Marquette Advisors
.
Proposed Racino at Canterbury Park
Shakonee. Minnesota Pa2e 7
Participation Rate Analysis Summary for Primary Market Area
2009 Participation Annual Average Potential
Oricin Adults Rate Visits Soend Revenue
o - 50 Miles 2,485,000 5.5 13,668,000 $55.00 $751,700,000
50 - 100 Miles 866,000 3 2,598,000 $60.00 $155,900,000
100 - 200 Miles 2,286,000 1 2,286,000 $65.00 $148,600,000
Tourists 2.000.000 na 2.000.000 $60.00 . $120.000.000
Totals 7.637.000 20.552.000 $57.23 $ 1.176.200.000
Source: GVA Mar uette Advisors
Applying the above participation rates to the, estimated future adult population figures for
the market area, and adding an estimated $120 million potential from tourism, the total
market potential for the Twin Cities is estimated to be $1.2 billiol1 in 2009. ,The existence
of six other casinos within the secondary market dilutes this demand for the primary market,
however. Some of this demand will be captured by the other casinos in the, surrounding
area.
Because the' proposed racino' s market overlaps with the markets. of at least four other casinos,
we constructed a,' constrained gravity. model ,that factored, in both the distances ,of, the
competitive casinos relative to the population (measured by drive times), and the 'competitive
advantages or drawfngpower of the individual casinos.. The general premise ofthis technique
is that the drawing power of a casino is directly related to its attractiveness and inversely related
to the square of the travel distance.
This analysis found that the number and locations of competitive casinos around the
perimeter of the Primary Market reduced the number of trips that the Twin City casinos
could expect. Adjusting the market area's gaming model to include the impact of
surrounding casinos results in lower participation rates. Applying the area's adjusted
participation rates described above to the future adult population figures for these sub-
markets and adding, a factor for tourists and demand from beyond 200 miles, the total
number of gaming visits to the four casinos in the prhnarymarket in 2009is projected to be
approximately 15,215,000.
Applying the same expenditure patterns to the available market produces a total projected
gaming win for the casinos in the primary market ofapproxilllately $859 million, as shown in
the table below.
,
Proposed Racino at Canterbury Park
Shakopee. Minnesota Pag-e8
Participation Rate Analysis Summary for Primary Market Area
2009 Participation Annual Average Potential
Oricin Adults Rate Visits Spend Revenue
0-.50 Miles 2,485,000 4.6 11,431,000 $55.00 $628,700,000
50 - 100 Miles 866,000 1.4 1,212,400 $60.00 $72,700,000
100 - 200 Miles 2,286,000 0.25 571,500 $65.00 $37,100,000'
Tourists 2.000.000 na 2.000.000 . $60.00 . $120.000.000
Totals 7.637.000 15.214.900 $56.42 . 858.500.000
Source: GVAMar uette'Advisors
Under both methods. of analysis we have reached a similar projected performance. for the
primary market. Consequently, we project that the primary market's gaming 'win in 2009 (the.
third year of the Canterbury racino's operation) will range between $839 million and $859
million.
PROJECTED CANTERBURY RACINO UTILIZATION
The subject racino would share this market with the three other casinos in the primary market.
A racino located at Canterbury Park will enjoy the following competitive advantages:
1. It will have' the most convenient 'location among the primary competitive casinos with
respect to most of the metropolitan area population.
2. The racing and other events held at Canterbury}>ark will expose large numbers of
potential new patrons to the racino~
3. The racino will serve alcohol, in contrast to some of the Native American casinos that
offer limited orno alcoholic beverage service.
4. Like, the State Lottery, public, awareness that a large portion of the racino's winnings
will go back to the state will enhance the racino's attractiveness for some patrons.
Based on our evaluation of the project's location, facilities and other competitive advantages
and disadvantages relative to the othercasihos, we project that the proposed racinoshould
capture about one third of this potential market, or $284 million of gaming revenue, as shown
in the table below. This revenue. would be in addition to the gaming revenue captured by the
card club located in the grandstand.
GV A Marquette Advisors . International Hospitality & Gaming Consultants
"
Proposed Racino at Canterbury Park
Shakooee. Minnesota Pag;e 9
Projected Casino Utilization
Annual Average Potential
Oril!in Visits 8Dend Revenue
o - 50 Miles 3,677,000 $55.00 $202,200,000
50 -100 Miles 421,000 $60.00 $25,300,000
100 - 200 Miles 191,000 $65.00 $12,400,000
Tourists 727.000 $60.00 $43.600.000 .
Totals 5.016.000 $56.52 $ 283.500.000
Source: GV A Mar uette Advisors
Based on our projections of the market mix of patrons at the racino, and their respective
expenditure patterns, the subject racino is projected to experience an average daily win per
position ranging from $217 to $252 over the first five years of its operation.
Proposed Canterbury Racino
Projected Wm (3,000 slots; 40tables)
2007 2008 2009 2010. 2011
Slot Revenue $232,524,000 $243,203,000 $254,314,000 $261,943,000 $269,801,000
Table Revenue 26.700.000 27.900.000 29.200.000 30.076.000 30.978.000 .
Total Gamng Revenue $259,224,000 $271,103,000 $283,514,000 $292,019,000 $300,779,000
Daily Win per Slot $212 $222 $232 $239 $246
Dailv Win Der Table $1.829 $1.913 . $2.000 $2.060 $2.122
Source: GVA Mar< tte Advisors
CLASS ill TABLE GAMES
We have,also prepared projections' for the racino inthe event itwas allowed to offer Class.lII
table games on a non-exclusive basis.
Building upon the loyal following that Canterbury has developed with its card room, the racino
could similarly.establish itself as the premier casino with respect to table games. Wehave
prepared financial projections for the racino under the assumption thatitoperates A5table
games at the racino:
0 4 Craps
0 2 Roulette
0 2 Mini-baccarat
0 37 Blackjack
.
.
Proposed Racino at Canterbury Park
Shakopee. Minnesota Pal!e 10
The eight Class III games would out perform the blackjack tables, resulting in a higher average'
daily win per table, but would have little impact on the performance of the slot machines
performance.
Proposed Canterbury Racino
Projected Win (3,000 slots; 45 tables)
2007 2008 2009 2010 2011
Slot Revenue $232,524,000 $243,203,000 $254,314,000 $261,943,000 $269,801,000
Table Revenue 36.042.000 37.698.000 39.420.000 40.603.000 41.821.000
Total Gamng Revenue $268,566,000 $280,901,000 $293,734,000 $302,546,000 $311,622,000
$212 $222 $232 $239
$2.194 $2.295 $2.400 $2.472
TEMPORARY RACINO
A new gaming facility would require approximately two years to design and construct. While
the development of theracino is in process, Canterbury Park plans to open a temporary racino
by installing slot machines within the existing grandstand area. . Sufficient space exists for .1,200
machines and supporting amenites would be provided by the existing' food and. beverage
facilties at the track.
This strategy will allow the Park to begin generating revenue (and tax revenue) by 2006. It will
also provide an excellent opportunity to train gaming and surveillance 'staff, prior to the'opening
of the new largeracino.
Based on a competitive analysis, we project that the temporary racino, with 1,200 slot
machines,would be able to achieve an annual gaming win of$87ll1il1ion in 2006, with a full
year of operation. This represents a utilization level of about $198 per slot machine per day.
Projected slot revenue of $87 million would produce an estimated revenue sharing amount '.
equal to $48.6 million.
International Hospitality & Gaming Consultants
.
.
Proposed Racino at Canterbury Park
Shakopee. Minnesota Pa2e 11
REVENUE SHARING PAYMENTS
Revenue Sharing payments are estimated tO,be the following:
Proposed Canterbury Racino
Projected Revenue Sharing Payments
Share 2006 2007 2008 2009 2010 2011
<:mmd Fund (slots) 35.0% $30,353,000 $81,383,000 $85,121,000 $89,010,000 $91,680,000 $94,430,000
<:mmd Fund (tables) 20.0"10 - 5,340,000 5,580,000 5,840,000 6,015,000 6,196,000
MN. State Lottely (slots) 10.0"10 8,672,000 23,252,000 24,320,000 25,431,000 26,194,000 26,980,000
Scott County (slots) 1.0"/0 867,000 2,325,000 2,432,000 2,543,000 2,619,000 2,698,000
aty ofShakopee (slots) 1.0"10 867,000 2,325,000 2,432,000 2,543,000 2,619,000 2,698,000
Purse Increases (slots & tables) 7.25% 6.287.000 ]8.794.000 ]9.655.000 20.555.000 21J 71.000 21.806.000
Total revenue Share $47,046,000 $133,4]9,000 $139,540,000 $145,922,000 $150,298,000 . $]54,808,000
Source: GVA tte Advisors
DIRECT ECONOMICJMPACTS
Direct impacts are'changes in the industry in which a final demand change is made. In the case
of the racino. operation, direct impacts would be those generated directly at the racino. These
include employment, wages, and purchases of goods and services by the racino', complex,., as
well as revenue sharing and payments in lieu of taxes paid to the local, state and/or"federal
governments.
Although t:lotaddressed in this study, there are additional rounds of benefits that would result
from the racino operations that are frequently addressed when examining the total economic
impact from a project. While direct impacts from a business venture are easy to understand, the
concepts of secondary effects, known as indirect and induced impacts, are among the most
widely used and most poorly understood tools in economic analysis. Theseimpastsare
frequently referred to as the "multiplier effect". Fundamentally, they are based upon an
extension of ,the direct expenditures by the racirio operation~ The revenues generated by the
racino are redistributed back into the economy in the form of wages, taxes and expenditures for
goods and services. In the same manner that the racino redistributes the revenue it receives, the '.
people to whom those, wages are paid and. from whom the goods and' services. are purchased
further redistribute the money they receive in the form of wages to their employees and
purchases for, their own operating, needs. ,It is this on-going cycle '. of redistributiol1', that
estimates of indirect and induced impact attempt to quantify. .
GV A Marquette Advisors
I
.
Proposed Racino at Canterbury Park
Shakopee. Minnesota Paee 12
Our estimates of the direct impacts that the Canterbury Park racino will have on the community
and the state (beyond the. current impact of the racing facility), with respect to newjobs,
earnings, purchases and tax revenue, are summarized in the following table:
Summary of Direct Impacts
Proposed Canterbury Racino
Construction jobs 655
Jobs at casino/hotel 1,300
Employee earnings $35.8 million
Purchases of goods & services $78.1 million
Revenue sharing $145.9 million
Tax revenue:
Property tax $2.3 million
Sales tax $7.3 million
State income tax $2.0 million
Source: GVA Mar uette Advisors
International Hospitality & Gaming Consultants
Racino.at Canterbury Park
Finally A Jackpot for .Minnesotal
Total
Biennium 6/30/2008 6/30/2009
(1). (2)
Number of Gaming Machines 1,200 1,200/3,000 3,000 3,000 3,000 3,000
Dally win per slot $ 198 $798/$212 222 $ 232 $ 239 $ 246
Blackjack Revenue $ - $ 13,950,000 $ 29,200,000 $ 57,100,000 $ 30,076,000 $ 30,978,000
Slot Revenue $43,362,000 $159,432,000 $254,314,000 $497,517,000 $261,943,000 $269,801,000
Net Gaming Revenues $43,362000 $ 173,382,000 $ 283,514,000 $ 554,617,000 $ 292,019,000 $ 300,779,000
Purse Expense $ 3,143,745 $ 12,570,195 $ 15,713,940 $ 19,654,968 $ 20,554,765 $ 40,209,733 $ .21,171,378
.' 7% 7%
Canterbury Park - netavailable for $19,838,115 $ 83,088,765 $102,926,880 $131,562,623 $ 137,591,655 $ 269,154,278 $ 141,719,213 $ 145,970,453
Operating expenses, Depreciation, 47% 49%
Interest, Taxes and Debt Service
ScollCounty $ 433,620 $ 1,594,320 $ 2,027,940 $ 2,432,030 $ 2,543,140 $ 4,975,170 $ 2,619,430 $ 2,698,010 $ 5,317,440
Cityot Shakopee $ 433,620 $ 1,594,320 $ 2,027,940 $ 2,432,030 $ 2,543,140 $ 4,975,170$ 2,619,430 $ 2,698,010 $ 5,317,440
Total Local Government $ 867,240 $ 3,188,640 $ 4,055,880 $ 4,864,060 $ 5,086,280 $ 9,950,340 $ 5,238,860 $ 5,396,020 $ 10,634,880
2% 2% 2%
Lollery-10% $ 4,336,200 $ 15,943,200 $ 20,279,400 $ 24,320,300 $ 25,431,400 $ 49,751,700 $ 26,194,300 $26,980,100 $ 53,174,400
State of Minnesota-BJ 20% - $ 2,790,000 $ 2,790,000 $ . 5,580,000 $ 5,840,000 $ 11,420,000 $ 6,015,200 $ 6,195,600$12,210,800
State of Minnesota-Slots 35% $ 55,801,200 $ 70,977,900 $ 85,121,050 $ 89,009,900 $174,130,950 $ 91,680,050$ 94,430,350 $186,110,400
One-time fee$ 100,000,000 $ 100,000,000 $ $ _
State General Fund $15,176,700 $158,591~200 $173,767,900 $ 90,701,050 $ 94,849,900$185,550,950 $100,625,950 $198,321,200
TOlal Slale and Lollery Revenues $19,512,900 $174,534,400 $194,047,300 $115,021,350 $120,281,300
% of Gamin Revenues 90% % of Gamin Revenues
Projected
Notes: ~,,~'M~' ~.
1) Temporaryfacilily1/1/06Io6/30/06; . --:K~~~,
2) T.mpo"~I";,"y 7/Ho'" 1 2131106 .mI. p'~OO"tI'''J;ty II1~", "'''''7; . · .. .Y.e. CANTERBURY.PARK
"
February 19, 2002
To: Brad Gessner
WestWorld General Manager
From: Rich Wetzel
Tourism Manager
WESTWORLD FYOO-01 VISITOR EXPENDITURE AND FISCAL IMPACT REPORT
Introduction
This report presents a summary of economic and fiscal information related to special events hosted at the
City-owned WestWorld Equestrian and Special Event Facilityduring fiscal year 2000-2001. The
objectives of the report are to: 1) establish an objective accounting of the value of the various horse
shows and other users; and 2) provide a model for the efficient collection of data for future years.
The study shows a total direct spending in Scottsdale of just under $25,000,000 ($35,812,099 adjusted by
multiplier) and City taxes of nearly $750,000 ($1,081,526 adjusted by multiplier). . .
Methodology
The Economic Vitality Office has over the past ten years developed a series of economic reports that
seek to objectively report to. the public the' performance of various economic sectors and the City
economy as a whole. . The experience gained from those projects, as well as a substantial number of
tourism-related surveys and reports, provided the foundation for the model developed in this project.
Research conducted included the review of City reports prepared for specific events held at WestWorld,
including the Barrett-Jackson Classic Car Auction, the Scottsdale Arabian Horse Show, and the
Thunderbird Balloon Classic. Those reports were all prepared by qualified, experienced outside
marketing or public opinion consultants utilizing an on-site intercept technique, provide a solid
understanding of the economic pynamics' of these varied shows.' This review also provided insight into
the conventions of data collection, analysis and reporting, which were then incorporated into this report.
Next, WestWorld staff provided a summary of all booked events held at WestWorld during FYOO-01.
Copies of the periodic reports to the Bureau of Reclamation (BOR) were provided which included
important data on rental revenues collected ,by the shows as well as attendance estimates, which would
later drive the formulas that are utilized in themodel. Examination of Tourism Development Event files
provided additional data on those shows that are subsidized by the City's Event Promotion fund; Event
files included specific data on entries; spectators, and performance aspects of the shows.
Finally, a format was developed that would provide consistent, complete and comparable accumulation of
data on each shownecessary for analysis. A multi-column table was prepared that would allow the
organization of events by date and also accommodate the segregation of stand-alone events from
recurring events as well as any future categorizations that might be desired.
Testing of the report format focused on the Scottsdale Arabian, Horse Show, since a series of on~site
intercept surveys had been conducted and solid baseline data existed for the economic impact
component. Minor changes were made to accommodate data entry, and notably. certain categories of
attendees were compressed to simplify data entry without compromising the integrity of the conclusions.
A preliminary data set was recorded and reviewed with WestWorld staff. A variety of corrections and
improvements were suggested dealing with assumptions about the number of vendors associated with
the shows and were incorporated in the.analysis. A final data'set was recorded andagain reviewed by
WestWorld staff. Corrections were made and final. figures are reported individually by event in thisreport.
WestWorld FYOO-01 Visitor Expenditure and Fiscal Impact Report
Page 2
Definitions
1. Exhibitor category includes all non-spectators (exhibitors, trainers, vendors, etc.).
2. Attendee category includes all spectators.
3. Visitors are individuals staying in Scottsdale hotels during the event.
4. Residents reside in Maricopa County or are transients staying in non-Scottsdale lodging.
5. A "Person/Day" is one person, on site one day and used to measure all participants types.
6. The City's Fiscal Year begins July 1 and ends June 30.
Limitations
Certain limitations are inherent in a report of this type:
1. The report focuses on direct spending and tax receipts to the City. It additionally includes a
spending"multiplier" of the turnover effect of basic spending (new dollars) in the community. This
multiplier can be considered or ignored, depending on the ultimate use of the information.
2. The event attendance figures (exhibitor and attendee) are provided by thevenue management or
the event producer and are not audited prior to use in this report.
3. Fiscal (tax) estimates are aggregated by period and not estimated or reported for individual
events in accordance with the City Tax Code and various state laws regarding public disclosure.
Data
1. Event Participant Characteristics at WestWorld Events
Various types of events are hosted at the WestWorld facility. Due to its design, it offers spacesthat can
be utilized as-is or adapted to the varying needs of most any activity that needs substantial parking
capacity and an outdoor environment. The characteristics of the dominant types (noted below) of
WestWorld events are based on.ten years of on-site intercept surveys.of representative events. by
qualified third party research firms or universities. ltis assumed that all events of a given type will
perform similarly within a category, and over a time series,' thereby eliminating the need for survey work at
each event.
Horse Shows
Horse Shows are the backbone of the WestWorld program and provided the incentive for the City to
locate and design the facility. Shows range from small one day club events to multi-day competitions
international in scope. The most prominent include the Scottsdale Arabian Horse Show and the Sun
Country Circuit Quarter Horse Show.
Exhibitors Attendees
36% of all participants 64% of all participants.
15% use Scottsdale hotels 45% use Scottsdale hotels
85% considered residents 55% considered residents
Western Events
Western events comprise a growing segment of business for WestWorld. These are characterized by
either competitions or exhibitions focusing in Scottsdale's western heritage. Notable examples
include the Parada del Sol Rodeo, the Cowboy Mounted Shooters and the Festival of the West..
Exhibitors Attendees
?Q% of Cill parti9ipCint~ 80% of all participants
70% use Scottsdale hotels 10% use Scottsdale hotels
30% considered. residents 90% considered residents
.
.
WestWorld FYOO~01 Visitor Expenditure and Fiscal Impact Report
Page 3
1. Event Participant Characteristics at WestWorld Events (continued)
Auto Auctions
At this writing, the only auto auction held at WestWorldis the Barrett-Jackson Classic Car Auction,
one of the largest in the world. The event is a commercial venture which draws buyers and sellers
from around the world as well as many attendees who merely attend to seethe sale cars.
Exhibitors Attendees
37% of all participants. 63%'of all participants
83% use Scottsdale hotels 19% use Scottsdale hotels
17% considered residents 81% considered residents
Auto Shows
Auto shows are distinguished from auctions in that they tend to display cars as part of a competition,
and are not actively traded in the confines of the event. The largest example at WestWorld is the
Good Guys Car Show in November. .
. . '. . ,
Exhibitors Attendees
37% of all participants 63% of all participants
15% use Scottsdale hotels 3% use Scottsdale hotels
85% considered residents 97% considered residents
Balloon Events
WestWorld hosts one balloon event, the Thunderbird Balloon Classic, the second largest such event
in the country. This event hosts national and international ballooncrews and features both flying and
non~flying activities over a four day period. Crews are generally from outof town while attendees are'
predominately Valley residents.
Exhibitors Attendees
4% of all participants 96% of all participants
72% use Scottsdale hotels 8% use Scottsdale hotels
28% considered residents 92% considered residents
Consumer Events
Consumer shows are wide-ranging and offer consumer products from cars to gifts typically in
weekend ,tented environments. They are predominately local vendors and attendees.
Exhibitors Attendees
4% of all participants 96% of all participants
72% use Scottsdale hotels 8% use Scottsdale hotels
28% considered residents 92% considered residents
.
WestW<>rld FYOO-01 Visitor Expenditure and Fiscal, Impact Report
Page 4
2. Spendina and Tax Contributions -- FYOO-01
Visitor Spending and derived Tax Revenue:
Participant Spendinq CitvTax Revenue
Hotel Room $73.56 per person/day $ 3.24 per person/day
Other $ 62.41 per person/day $ 0.87 per person/day
Total $135.97 per person/day $ 4.11 per person/day
Resident Spending and derived Tax Revenue:
Participant Spendino City Tax Revenue
All Expenditures $17.62 per person/day $ 0.53 per person/day
3. Visitor and Resident Spendina at scheduled Events
See Appendix A.
Key Findings
The overall direct eConomic contribution of events at Westworld is substantial. In summary, the total
contribution (direct on-site and off-site expenditures) by visitors was $18,364,997 while $6,428,104 was
contributed by residents, for a grand total direct spending of $24,793,101 in FYOO~01.
This office typically does not apply an economic or employment multiplier to estimates. At the request of
WestWorld management, we have examined the characteristics of the facility, hosted events, Scottsdale
and the Valley and have identified a multiplier of1.6 which can be reasonably applied to the direct
spending by non-resident visitors. This multiplier is a compromise of values used by the State's. two
largest educational institutions. The University of Arizona uses a1.2 multiplier for large-scale public
events while Arizona State University has calculated a 2.0 multiplier fro events such as the Tostitos Fiesta
Bowl and the Super Bowl. Because of the destination similarity of Scottsdale and Tucson, that
institution's more, conservative figure was considered since both. cities have well~devel()ped tourism
industries with the ability to absorb additional inputs with little new hiring, thus minimizing derivative
spending. The resultant value chosen was the. mid-way point between the two institutions, or 1.6. It
should be noted that the multiplier is not applicable to resident spending.
Applying the multiplier increases the total contribution (direct on-site and off-site expenditures) by non-
resident visitors to $29,383,995 while $6,428,1 04 was contributed by residents, for a grand total
economic contribution (adjusted by multiplier) of $35,812,099 in FYOO-01,
Fiscal contributions for the same year consisted of sales and bed taxes to the City Treasury of $554,623
from the visitor, $194,129 from residents for a grand total of$748,752 or$1 ,081 ,526 (adjusted by
multiplier).
Sources:
. Consultant prepared reports on selected signature events (1991-2000).
Staff estimates based on Calendar 2000 data from Scottsdale/Paradise Valley Visitor Study.
WestWorfd Event Reports - FYOO-01.
" " .-~,
Attachment: .
Appendix A: Visitor and Resident Spending at scheduled WestWorld events.
c:lwwevtlww events 0O-01eis.doc
.
.
APPENDIX A
VISITOR AND RESIDENT SPENDING AT SCHEDULED WESTWORLD EVENTS
, , Visitor Visitor Total Total
Exhibitor Attendee Visitor Resident Grand Total
Event Date Event ' Spending Spending Spending Spending Spending
07/08/00 TWHEA $ 1 ,346 $ 775 $ 2,121 $ 705 $ 2,826
07/15/00 TEA.M. Motorcvclists Trna. 0 0 0 4,017 4,017
07/15/00 Cowboy Mounted Shooters ',' 1,142 653 1,795 " 705 2,500
08/26/00 AZ Pinto Horse Assn. 1,652 979 2,631 705 3,336
08/27/00 Monterra-ESI " 0 0 0 2;097 2,097
09/09/00 Fox Lair Farm Show 1,652 979 2,631 , 881 '. 3,512
09/09/00 Merrv Go Round 1 ,407 , 857 2,264 758 " 3,022
09/09/00 AHAA Youth 2,203 1,306 3,509 1,163 4,672
09/15/00 AZ ApDaloosa Assn. 2,754 1,632 4,385 1,462 . 5,847
09/15/00 Stallion Breeders Futuritv 3,304 1,958 5,262 1,744 7,006 .
09/15/00 AZ Reining Horse Assn. 1,897 1,102 ,', 2,999 , 987 3,986
09/16/00 POA 1,101 653 1,754 581 2,335
09/25/00 Assn of Owners/Breeders 5,507 3,264 8,771 . 2,907 11,678
10/03/00 Scottsdale Fall Classic 7,710 4,570 12,280 4,070 16,354
10/05/00 Hall Weddina ' 0 0 0 4,194 4,194
10/07/00 AZ Pinto Horse Association 1,652 979 2,631 881 3,512
10/08/00 National Mounted Police 9,994 612 10,606 1,744 12,350
10/13/00 AZ Appaloosa Association , 5,507 3,264 8,771 2,907 11,678
10/12/00 4-H Horse Show 11,014 65,281 17;542 5,815 23,357
10/14/00 Merry Go Round 1,346 775 " 2,121 705 2,826
10/15/00 Special Olvmpics 0 0 0 10,466 10,466
10/19/00 AZ Futuritv 5,507 3,264 8,771 2,907 11,678
10/20/00 Kunselman Wedding 0 0 0 4,194 4,194
10/21/00 SPD Motorcvcle Trna. 0 " 0 0 846 846
10/24/00 Polo America 4,406 2,611 7,017 2,326 9,343
10/25/00 Thunderbird Balloon Classic 117,480 313,274 430,755 470,454 901,209
10/26/00 AZ Dressage Association 6,609 3,917 10,526 3,489 , 14,015
10/29/00 Thoroughbred Breeders Sale 22,028 13,056 35,084 11,629 46,713
11/06/00 Arabian Horse Assn.of AZ . 17,623 10,445 28,068 9,303 37,371
11/07/00 Junior Leaaue Gift Mart 0 0 I . 0 58,146 58,146
11/11/00 Ponies of America 1,346 775 2,121 705 2,826
11/11/00 AZ Reining Horse Assn , 1,652 979 2,631 881 3,512
11/12/00 Fox Lair Farm Show 1,101 653 1,754 581 2,335
11/13/00 AZ Season Finale ,. 5,507 3,264 . 8,771 . 2,907 11,678
11/15/00 Goodauvs Car Show 55,870 32,382 88,252 327,732 415,984
11/24/00 Am West 4D Holidav Series 8,811 5,222 14,033 4,652 18,685
11/28/00 . Cowboy Mounted Shooters 7,710 . 4,570 12,280 4,070 16,350
12/01/00 Cave Creek Cutting Club 979 592 1,571 529 2,100
12/07/00 Copper State Classic 6,609 . 3,917 10,526 3,489 . 14,015
12/12/00 Saguaro Classic , 17,623 10,445 28,068 9,303 37,371
12/14/00 AHAA , 1,346 775 2,121 705 2,826
12/15/00 Atronic America 0 0 0 4,194 4,194
12/16/00 Centrex Homes 0 " 0 " 0 4,194 4,194
12/27/00 USTRC 44,057 26,112 70,169 23,258 " 93,427
12/29/00 Goodman Team Penning 3,304 1,958 5,262 1,744 7,006
01/05/01 AZ Apoaloosa Association 7,710 4,570 12,280 4,070 16,350
01/06/01 AHAA ',' 3,304 1,958 5,262 ' " 1,744 7,006
01/06/01 SPD 0 0 0 4,070 4,070
01/10/01 . AZ National QuarterHorse 16,521 9,792 26,313 8,722 .35,035
01/12/01 Phoenix Open Parking . 0 0 0 58,146 . 58,146
01/18/01 Barrett-Jackson Auto Auction 6,639,554 2,587,391 9,226,945 1,596,901 10,823,846
01/22/01 Bird's nest Music Fest 0 0 0 209,326 209,326
01/22/01 Sun Country Circuit , 660,852 391,680 1,052,532 348,876 1,401,408
02/04/01 AZ Pinto Horse Assn. ,2,205 . 1,306 3,511 1,163 4,674
02/05/01 Parada del Sol Rodeo " 146,856 195,840 342,696 139,550 482.246
02/06/01 All Arabian Horse Show 2,643,408 1,566,720 4,210,128 1,744,380 5,954,508
02/25/01 ESI , 0 0 0 5,233 5,233
03/02/01 AZ Miniature Horse Assn. . 22,028 13,056 35,084 11,629 46,713
03/02/01 AZ Paint Horse Assn. , 5,507 3,264 8,771 2,907 11,678
03/02/01 Goodman Team Penning 3,304 1,958 5,262 1,744 7,006
03/02/01 Rugby Tournament 11,612 14,960 26,572 20,457 47,029
03/03/01 All Gaited Horse Show 2,754 1,632 4,386 1 ,462 5,848
03/05/01 Reinina Horse Classic 26,434 15,667 ," 42,101 13,955 56,056
.
,
Visitor Visitor Total Total
Exhibitor Attendee ' Visitor Resident ' Grand Total
Event Date Event Spending Spending Spending Spending Spending
03/08/01 Festival of the West $1,408,664 $ 342,720 $1,751,384 $ 549,744 $2,301,128
03/09/01 AZ Appaloosa Association 4,956 2,938 7,894 2,625 10,519
03/10/01 Ponies of the Americas " 1,346 . 775 2,121 705 2,826
03/13/01 Carousel Horse Show 22,028 13,056 35,084 11,629 46,713
03/18/01 Cowbov Mounted Shooters 5,330 1,278 6,608 1,744 8,352
03/20/01 NRCHA 26,434 15,667 42,101 13,955 56,056
03/21/01 Scottsdale Dog Fanciers 44,057 26,112 70,169 23,258 93,427
03/21/01 Jump Into Sprina H/J 3,855 2,285 6,140 2,044 ' 8,184
03/25/01 Fox Lair Farm Show 979 ' 592 " 1,571 529 2,100
03/27/01 BBQ Cook-off 0 0 0 167,390 167,390
03/30/01 Saddle Series Gvmkhana , 1,652 979 2,631 1,057 . 3,688
03/30/01 USDF Svmposium 22,028 13,056 35,084 11,629 , 46,713
03/31/01 Beta SiomaPhi 0 0 0 5,867 5,867
04/01/01 AZ Pinto Horse Assn. 857 530 1,387 458 1,845
, 04/02/01 Arizona Bike Week 52,892 195,660 248,552 245,799 494,351
04/05/01 World of Dancina Horses 44,057 26,112 70,169 23,258 ," 93,427
04/06/01 AZ Dressaae Assn. " 5,507 3,264 8,771 2,907 11,678
04/06/01 AZ Quarter HorseAmateur 2,754 1,632 4,386 1,462 5,848
04/13/01 AZ Paint Horse Club 2,754 1,632 4,386 1,462 5,848
04/13/01 AZ Appaloosa Assn. 2,754 1,632 4,386 1,462 5,848
04/13/01 Ponies of the Americas 1,346 775 2,121 705 2,826
04/13/01 St. Patrick's Church " 0 0 0 133,912 133,912
04/14/01 Merrv Go Round 1,652 979 2,631 881 3,512
04/15/01 Cave Creek Cutting Club 979 592 1,571 529 2,100
04/19/01 Hunt CUD Series 1,775 1,040 2,815 934 " 3,749
04/21/01 Polo America 7,710 4,570 12,280 4,070 16,350
04/21/01 Rotary Club 9,913 5,875 15,788 5,233 21,021
04/22/01 Fox Lair Farm Series 857 530 1,387 458 '.1,845
04/22/01 Region VII 33,043 19,584 52,627 17,444 70,071
04/22/01 St. Patrick's Church 0 0 0 2,097 2,097
05/04/01 AZ Fox Trotters 4,956 2,938 7,894 2,625 10,519
05/04/01 AZ Peruvian Paso Club 1,652 979 2,631 881 3,512
05/05/01 AZ Reining Horse Assn. ' 1,101 653 1,754 581 2,335
05/06/01 Cave Creek Cutting Club 1,346 775 2,121 705 2,826
05/12/01 AHAA Youth 2,754 1,632 4,386 1 ,462 8,674
05/19/01 Ponies of the Americas 1,346 775 2,121 705 2,826
05/19/01 Fox Lair Farm Series 857 530 1,387 . 458 1,845
05/19/01 Arab Youth 1,652 979 2,631 881 3,512
Summer TEAM Arizona 8,811 5,222 14,033 4,652 18,685
06/02/01 Merrv Go Round 2,754 1,632 4,386 1,462 5,848
06/09/01 ' AZ Pinto Horse Assn. 857 530 1,387 458 1,845
06/16/01 Fox Lair Farm Series 857 530 1,387 458 1,845
06/23/01 Arab Youth 2,754 1,632 4,386 1 ,462 5,848
Year All Events $12,324,681 $ 6,040,316 $18,364,997 $6,428,104 $24,793,101
~
f
11 KRA'US'ANDERSON .CONSTRUCTION COMPANY
· CONTRACTORS & CONSTRUCTION MANAGERS " .
@ , " ,','" " ", ',' '" .
February 7,' 2005
Mr. Randall D. Sampson
President and General Manager
Canterbury Park Holding Corporation
1100 Canterbury Road
Shakopee, MN 55379~1873
Re: Racino at Canterbury.Park
Preliminary Budget
Dear Mr. Sampson:
In responsetoyour recent request, Kraus-Anderson Construction Company is pleased to
provide you theenc10sed budget proposal for.the Racino Facility at Canterbury Park
Our budget proposal is based on recent casino-hotel facilities wehave constructed.
If you have allY questions regarding our proposal, please contact me. directly.
Very truly yours,
KRAUS-ANDERSON CONSTRUCTION COMPANY
---.
TJS/jlu
Enclosure
.
I
RACINO AT CANTERBURY PARK
SHAKOPEE, MN
PRELIMINARY BUILDING PROGRAM AND BUDGET
February 7,2005
SITE IMPROVEMENTS (Allowance) $6,500,000
. Site Earthwork . Site Ponds for Storm Water Retention
. Site Utilities . Site Bituminous Roads/Paving
.' Site Signage . Cross Country Course
. Landscaping . Horse Polo and Training Field
. Site Concrete . Miscellaneous Site Improvements
. Site Electrical
CASINO COMPLEX 190,900 S.F. $41,120,000
. Gaming Floor - 3,000 Slot Machines 84,000 S.P. $21,000,000
. Table Games 22,500 S.P. $5,625,000
. Race Book 3,400 S.P. $680,000
. Public Circulation 30,000 S.P. $7,500,000
. Porte Cochere 6,000 S.P. $1,140,000
. Back of House 45,000 S.F. $5,175,000
RESTAURANT, FOOD, BEVERAGE 24,275 S.F. $7,732,500
. Restaurant...,. 150 Seats 3,000 S.F. $900,000
. Buffet - 350 Seats 7,000 S.F. $2,100,000
. Snack Bar/Deli - 40 Seats 2,500 S.F. $750,000
wlKitchen/Serving
. Lounge - 150 Seats 2,250 S.F. $675,000
. Bar - 35 Seats 525 S.P. $157,500
. Kitchen/Serving/Storage 9,000 S.P. $3,150,000
HOTEL 127,974 SF $34,060,000
250 Guest Rooms - 277 Bays total
. 238 Standard Rooms
. 12 Suites
.
,
HOTEL FIRST FLOOR & BASEMENT 58,000 S.F. $8,880,000
. Retail 5,000 S.P. $625,000
. Spa, Exercise, Sauna 5,000S.P. $1,250,000
. Swimming PooVShower!Toilets 8,000 S.F. $2,000,000
. Back of House/Mechanical/Elecuical 30,000 S.F. $3,450,000
. Laundry 3,000 S.P. $750,000
. Storage 7,000 S.P. $805,000
CONFERENCE CENTER 50,000 S.F. $9,250,000
. Main Ballroom - 750 Seats 15,000 S.P. $2,775,000
. Junior Ballroom.,... 500 Seats 10,000 S.F. $1,850,000
. Meeting Rooms 5/6 Rooms, 25/50 Seats each 10,000 S.P. $1,850,000
. Prefunction, Convention Services 15,000 S.F. $2,775,000
. Casino, Hotel, Restaurants, Conference Center 451,149 S.F. $107,542,500
TOTAL PRELIMINARY PROGRAM AND
COST
HORSE FACILITY
HORSE SHOW BARNS $5,500,000
. 400 Stalls
OUTDOOR SHOW ARENAS $235,000
WESTERN SHOW ARENAS & PENS $65,000
INDOOR HORSE SHOW ARENAS $8,000,000
TOTAL HORSE FACILITY , $13,800,000
BOARD OF COUNTY COMMISSIONERS
SCOTfCOUNTY, MINNESOTA
March 1 t 2003
2003-032
Hennen
Marschall
RESOLUTION 2003-032 - SUPPORTING SF576/HF646 ALLOWING THE MINNESOTA STATE
LOTTERY TO CONDUCT SLOT MACHINE ("RACINO") GAMING AT CANTERBURY PARK
WHEREAS, the Minnesota ,Legislature, per Senate' File 576 (Senator Dick Day)' and House File 646
(Representative Mark Buesgens). will be requested to allow the Minnesota State lottery toadministerslot
machine gaming at Canterbury Downs racetrack in Shakopee., Minnesota; and ..
WHEREAS. the legislation currently stipulates that the affected local governmental jurisdictions (the
City of Shakopee and the County of Scott) are each to be the recipients of 0.5 percent of the gaming. revenue
generated by the proposed slot machine gaming; and
WHEREAS. the County of Scott has pursued an aggressive policy of fiscal austerity clndaccountability
over the course of the last several years,. of which stability in the propertytaxlevy,has.been'determinedto be
of paramount importance;
THEREFORE BE IT RESOLVED that the Scott County Board ofCommissionersofficiaUy supports the
legislative initiatives put forth by Senator Dick Day and Representative Mark Buesgens to allowthe Minnesota
State Lottery to conduct slot machine gaming on the site of Canterbury Downs in Shakopee, Minnesota;
BE IT FURTHER RESOLVED that the Scott County Board ofGommissiohers will employ any
revenue generated by the "tacino" at Canterbury to offsetting County-incurred costs attributable "to .
gaming activities at this facility.
RIYes [J Absent
MYes DNo C Absent
Marschall W1Yes ONo o Absent
Ulrich .RYes uNo . 0 Absent
State of Minnesota)
CountyofScott ), ' " .. ' , ' ,,','.,' " ',,' ...' ,..
I; David J. Unmacht, duly appointed qualified and County Administrator for the County of Scott, State of Minnesota, do hereby certify
that I have compared the foregoing copy of aresolution with the original minutes of the proceedings ofthe Board of County '.. ..',.
Commissioners, ScottCounty,Minnesota, attheir session held on the 11th day of March, 2003 now on file in my office. and have found
the same to be a troeand correct copy thereof. . .. .
Witr1esS my hand and official seal at Shal<opee. Minnesota, this 11 th
'. County Administrator
.- .--.- ....._.....u ~. - .. -
RESOLUTION NO. 5865
A RESOLUTION ENDORSING THE ESTABLISHJ\1ENT
OFA "RACINO"FACILITY AT CANTERBURY PARK, "
SHAKOPEE, MINNESOTA
WHEREAS, in 1985, Canterbury Downs opened as Minnesota's pari-mutual
horse racing facility; and
WHEREAS, since its opening as Canterbury DoWns, the racetrack has seen
significantly increased competition from other outlets for gan1bling; and
WHEREAS, in 2000, a Card Club was opened at Canterbury Park, which has
provided increased purses to support the horsetacingindustry in lYfiImesota;and .
WHEREAS, taxpayers in the State of Minnesota are not realizing a financial
benefitii"om other forms of casino gambling in Minnesota; and
WHEREAS, the establishmentof a "Racino" -style gaming facility at Canterbury
Park could generate millions of dollars as revenues for the State of Minnesota, in addition
to bolstering horse race purses for Canterbury; and .
WHEREAS, as proposed, the County of Scott and City of Shakopee would split
one per cent of the adjusted gross gaming machine revenues,wmchwill help offset the
additional public safety and transportation expenses which' are expenel1ced by these two
units of government in hosting entertainment in the area; and.
WHEREAS,Canterbury Park is the Jogical location for a casino to benefit the
State of Minnesota, in that much of the infrastructure needed fora successful gambling
operation is already in place" and its location in Shakopee is a natural addition to the
other tourism attractions in the area.
NOW, THEREFORE, BElT RESOLVED by the Mayor and City Council of the
City of Shakopee, Minnesota that it hereby endorses the concept of casino-style slot
machinestobe added to the existing Canterbury Park facility (to be known as the
"Racino at Canterbury Park").
. Adopted in regular sessionofthe CityCouncilof the City of Shakopee,
Minnesota held this 4th day of March 2003. t;.. . .. ..
~
1',
,
,
fJ'
....
CANTERBURY PARK
Questions &Answers
Q: Whatis a Racino?
A: Aracino is a racetrack that also offers casino games for the purpose of increasing live racing
purses and generating gaming tax revenue for local and state government. Ten states have
already apprQvedRacinos, and they have been proven to be, an effective gaming model
because of the enormous benefits they generate beyond the new tax revenues.
For example, Iowa authorized its first Racino in 1994. According to an Iowa State
University study, between 1994 and 1999 the amount spent on the care and maintenance of
horses in the state more than doubled, providing needed growth for the state's rural economy,
Iowa is, only one of many states reaping the vast benefits of racinos. ,A 2003 survey of New
Mexico Horse Breeders reports that since New Mexico authorized Racinos in 1998, it has
witnessed:
. 216% growthinthe amount spent on alfalfa and grain.
. 324% growth in the amount spent on veterinarian care.
. 413% growth in the amount spent on horse trailers.
Based on the success, of racinos in states across' the country, many others are now considering
legislation to add slot gaming at their racetracks, inc1uding:Florida, Kansas, Kentucky,
Maryland, and Ohio.
Q: Why is an equestrian center part of the Racino proposal?
A: The vision of the Racino is to transform Canterbury Parkinto the centerpiece for Minnesota's
race and show horse industries. As part of the Racino proposal, Canterbury Parkisplanning
to build a, world-class equestrian park capable of hosting local, regional and national show
events.
Despite having a large show. horse community, Minnesota lacks a premier national equestrian
park. While the equestrian center does not require legislative approval, passage" of the
Racino would provide Canterbury Park with the revenue necessary to construct the' facility,
allowing Minnesota to draw ~l1ows and the accompanying tourism dollars from around the
country.
:1
~
Q: Will horse racing suffer if slot machines are introduced at Canterbury Park?
A: No. To the contrary, slot machines at Canterbury Park will provide an additionalboost to
live racing and Minnesota' shorse industry:
- Purses at Canterbury Park will increase nearly $18 million each year with the addition of
slot machines, nearly tripling the amount of current. purses. Of this amount,
approximately $3.6 million will go to the Minnesota Breeders' Fund, which promotes
Minnesota'sracing and breeding industry.
- Based on the experience. in other states, growing racing purses will fuel the investment in
breeding ,and foaling in Minnesota. As the number of horses bred in Minnesota grows,
positive effects will ripple through the rest of Minnesota's agricultural industry.
Q: Can the Racino meet Governor Pawlenty's gaming revenue goals?
A: When fully operational, the Racino will generate more than $200millioneverybienniumin
new.state gaming tax revenues, according to recent estimates by GVA Marquette Advisors.
Q: Why do other gaming proposals anticipate greater revenues for the state?
A: there are a few reasons. Canterbury Park's estimatesTeflect a more modest gaming proposal
with 3,000 slot machines. and 40 table games, while most other proposals project 4,000 or
more.slots.
In addition, Canterbury Park has chosen to be more conservative in our win estimates,
forecasting $212,. $246 per machine each day compared to $295 inthe Governor's proposal.
However, the Racinobill proposes providing a higher percentage of the revenue to state and
local governments than other gaming proposals before.the,legislature.
Q: The Governor's proposalhasa $200 million up front fee. Why is the Racino's proposed
fee only $100 million?
A: The Racino at Canterbury Park proposal provides 47% of the net gaming revenues to state
and local government, one of the largest percentages in the country. Based on the financial
projections for the Racino, a $100 million up-front fee is prudent if the State is to receive
$200 million each biennium in new state gaming tax revenues once the Racino is fully.
operational.
,
:
Q: Will the Racino generate revenue for the state in the coming biennium?
A: Yes. The Racino proposal includes a $100 million up front fee. Additionally, Canterbury
Park could have a temporary. facility operational, and generating revenue for the' state within
7-9 months of passage of the bill. If the legislature approves this proposal in May, the
Racino could generate over $175 million in new state gaming taX revenues for the state inthe
coming biennium.
Q: How much support does the Racino have statewide?
A: The Racino is the gaming proposal with the broadest public support because of the wide
range of benefits extending to the horse and agriculture industry., Numerous statewide polls
confirm that 70% of Minnesotans support the Racino. Support among the public stretches
across ideologi~allines and to all regions of the state.
Q: Can the Racino meetthe Governor's requirement for localsupport?
A: The Racino at Canterbury Park already enjoys strong local support
- The Racino is endorsed by both the City of Shakopee and S90tt County
- According to a 2004 poll by DecisionResources Ltd., the Racino is supported by74%of
Scott County residents
Q: The Governor says that Canterbury Park may become the site of the state-tribal
partnership casino. How does Canterbury Park feel about that scenario?
A: Canterbury Park will consider any proposal that can help grow the horse industry in
Minnesota. However, at this point Canterbury Park is advocating for the Racino proposal,
which would nearly triple live racing purses and allow for the construction of aworld-c1ass
equestrian park at Canterbury.
Q: Is gambling a good way to raise money for needed state services?
A: Currently 87% of Minnesotans participate in some form of gambling. Gambling has already
been used in Minnesota to raise funds for a variety of local' and state needs, and racinos have
proven tobea tremendously effective way for other states to raise new gaming tax revenues.
For example, according to the Iowa Racing and Gaming Commission, Iowa has raised well
over $650 million. in revenue from racino gaming over' the past ,10 years that has been used
for needed services and programs... in a much smaller market!
!
t
Q: Would passing the Racinomean breaking the existing tribal compacts?
A: No;, The existing tribal compacts allow the stateto authorize gaming outside of tribalcasinos
if the legislature deems fit. While the tribal casinos have enjoyed a monopoly on some
casino gaming since they opened, exclusivity was not guaranteed in the agreement.
Q: Will the Racinoproposal automatically authorize slot machines at the newly licensed
. harness trackin Anoka County?
A: No. The Racino bill deals only with currently operating racetracks.
Q: Won't the Racino ultimately hurt business atexisting tribal casinos?
A: That's very unlikely. Business at tribal casinos has exploded in recent years as more and
more Minnesotans and tourists are looking for gaming options. Since 1996, the number of
slot machines at Minnesota's . tribal. casinos has increased over 50 percent, according, to
annual surveys by the Business Journal. There is no reasonto believe that trend will end
soon.
The Shakopee Valley News, the local newspaper in the area which is ,home to both
Canterbury Park and Mystic Lake Casino, concluded in an editorial that the demand for
gaming and entertainment in Minnesota has reached a point that Mystic Lake would not be
harmed by the presence of a Racino at Canterbury Park
Q: ,Would passing the Racino bring "Las Vegas" to Minnesota like opponents keep saying?
A: According to popular estimates, Minnesota already has 21,000 slot machines at its 18 casinos
owned by tribalgovemments. Canterbury Park is proposing to add an additional 3,000 slot
machines in a location that already offers. horse, racing, simulcast racing and' a 24-hour card
club.
Ten other states have passed Racinos to generate needed revenue and improve their
agricultural economies, and they have succeeded. That's exactly what a Racinowould do for
Minnesota.
Besides, when was the last time you heard anyone say "what happens inAltoona stays in
Altoona?"
-
A JA.CKPOT FOR ALL MINNESOTAN~
The Vision ~
The Racino at Canterbury Park would be the first entertainment and gaming facility of its kind in Minnesota.
Currently Offered at Canterbury Park: The Racino Would Add the Following:
Live Horse Racing World-Class Equestrian Park
Conducted at one of the nation's finest facilities for racing, Despite having an enormous show horse industry in Minnesota,
Canterbury Park's live racing meet is enjoyed by over 300,000 the state lacks a large regional or national equestrian center.
Minnesotans annually. Canterbury Park's 2005 live racing meet Passage of the Racino would change that. As part of the Racino
will stretch from Kentucky Derby Day through Labor Day. proposal, Canterbury Park would construct a major horse show
facility.
Simulcast Racing
Year round, patrons can watch and wager on races from horse The equestrian center would:
tracks around the country. From the Breeders' Cup to the · Include two indoor arenas, three outdoor arenas (including a
Belmont Stakes, Canterbury Park offers opportunities for horse working western arena), a cross-country jumping course, and
racing fans 364 days a year. new stalls specifically for show horse events.
Card Club · Be capable of hosting a litany of local, regional and national
The Card Club at Canterbury Park offers Texas Hold 'em, along equestrian events that are currently going to other states, along
with other traditional poker and casino card games. Approved with the economic impact they generate.
in 1999, the Canterbury Card Club has allowed the track to · In comparison, West World, an equestrian center in Scottsdale,
increase Thoroughbred and Quarter Horse racing purses by over Ariz., created nearly $25 million in direct spending in the
75% since its inception. community from events at the facility.
Special Events Slot and Card Gaming
Canterbury Park is home to special events year round, ranging The Racino would authorize slot gaming and banked blackjack
from WSA snowmobile racing to the Upper Midwest's largest at Canterbury Park to complement its current games.
craft show. Over 100,000 people visit Canterbury Park each year
for special events alone. Canterbury Park would privately finance the construction of a
casino adjacent to the existing racing grandstand to house the
3,000 slot machines and table games. The separate casino facility
would allow Canterbury Park to retain the family-friendly live
~ horse racing atmosphere Minnesotans have grown to love.
250-Room Hotel With Conference Facilities
Built overlooking the main track, the 250-room First Turn Hotel
would feature private balconies where guests could comfortably
view morning workouts as well as almost feel the racing action.
The hotel and conference center would help accommodate
patrons of live racing, casino gaming and the equestrian center.
Fine Restaurants
The Racino project will include the construction of additional
dining options at the Racino and the hotel.
Canterbury Park Publication. March 2005 PARK
The Proposal ~
Some of the Legislative Highlights of the A Minnesota Model for Gaming
Racino Proposal Include:
Benefits The Racino at
· The Racino would authorize the Minnesota Lottery to operate Canterbury Park
slot machines at a licensed racetrack and allow for banked A Minnesota-owned company ./
blackjack and other games authorized at tribal casinos. New Minnesota jobs and investment ./
1
I · The Racino would be tightly regulated by the Minnesota State New state gaming tax revenues ./
I Lottery and the Minnesota Racing Commission. Stronger rural economy ./
I Supported by 70% of Minnesotans ./
. The Racino would provide a one-time fee of $100 million to be
I paid to the state's general fund. Endorsed by the host city and county ./
I Backed by Minnesota labor unions ./
I . Approval of the local governing body would be required for
the Racino.
I -~
I . The facility would be privately financed and would not
I require any state bonding or operating subsidies.
I . The Racino would create jobs and significant new state tax
I revenue as well as spur growth in the racing and show
I industries through increased racing purses and a new
Olympic-caliber show arena.
I . Without expanding the number of gaming locations, the
I Racino would help meet a quickly growing demand for
I gaming and entertainment by Minnesota residents and
I tourists.
I
I
I Racino TheRACINO would generate
I Casino Proceeds Economic Model
I 10.75%
(be'n," 'nn'''",hnn ~
(('sts)~
I over $175 MILLION
I
Casino
I Income Taxes'" for the state in the
7.0%
I COMING
I Casino
Operating BIENNIUM.
I Expenses*
28%
! Horse RaClng /
Purses & Breeders
I Fund 201
. . projected 7.25% ,"
I State revenues are in addition to a $100 million up-front fee.
I
I
I Canterbury Park Publication. March 2005
-- ---~ _.~ ~.-- ------ -- -,~
",
""It: ..
A LACKPOT FOR ALL MINNESOTANS--
The Benefits ~
Generate Substantial New Gaming Tax Revenues. Energize Minnesota's Horse and Agriculture Economy.
According to a conservative market analysis based on the addition A University of Minnesota report recently concluded that
of 3,000 slot machines and banked blackjack at Canterbury Park, the Minnesota's horse industry is worth nearly $1 billion to the state's
Racino would generate $100 million every year in new state tax economy each year. However, the economic value and impact of
revenue once fully operational. horses could grow substantially with additional investments in
racing and horse shows. The Racino at Canterbury Park would do
Combined with a $100 million up front fee, the Racino could net the both.
state over $175 million in revenue in the coming biennium.
The Racino would more than double purses for live racing at
Create New Jobs. Canterbury Park, which would spur growth in horse breeding
According to the market study, the Racino would directly create levels throughout the state. Every state that has authorized a Racino
1,300 new full and part-time jobs at the Shakopee facility, as well as has experienced substantial growth in the size and impact of its
the equivalent of over 650 full-time jobs during the construction of horse industry. Additionally, as part of the Racino project,
the Racino. Canterbury Park has signed a card-check neutrality Canterbury Park would construct a world class equestrian park,
agreement with the Hotel Employees and Restaurant employees igniting growth in Minnesota's show horse community.
Union Local No. 17 and has the support of a number of unions
throughout Minnesota. Minnesotans Support the Racino at Canterbury Park.
Four separate statewide polls have found that over 70 percent of
Minnesotans support the Racino at Canterbury Park and want to
$100 use the new state gaming tax revenues for critical services such as
local education and funding for nursing homes,
According to surveys, more than 80 percent of Minnesotans gamble
in some form each year. The market for gaming in Minnesota is
growing, as evidenced by the continual expansion of Tribal casinos.
Million
. state tax
In new revenue
every year!
..-
Canterbury Park Publication. March 2005 CANTER
I - -
III-~.-~-.~
A JACKPOT FOR ALL
I Su~ort
I for the Racino ~
I
I
I Statewide Support
I The Racino at Canterbury Park is not the biggest or the flashiest gaming proposal before the Minnesota Legislature, but it is the proposal
I with the strongest measure of support statewide.
I Poll after poll confirms that 70% of Minnesotans support the Racino at Canterbury Park. I
I I
I I
I I
I I
MPR/Pioneer Press Poll Star Tribune Minnesota Poll Canterbury Park Poll
I April 29.May 1,2003 April 25.29, 2003 April 15-21,2003 I
I I
I \
I 24% I
I
I
I I
I Undec:idedlDK Support Oppose UndecldedlDK \
Support Oppose Undecided/DK Support Oppose
I \
I Horse Industry Support Union Support I
I I
I Because of the tremendous benefit the Racino would bring to The Racino Proposal is Supported by Many Minnesota I
race and show horse enthusiasts alike, the project is supported Labor Unions: I
I by a broad range of Minnesota's horse community. . Building & Construction Trades Council - Mpls_
I The Racino at Canterbury Park is Endorsed by: · Hotel Employees & Restaurant Employees Local 17 I
I
I · The Minnesota Horse Council · IBEW
I · Minnesota Thoroughbred Association · PACE International I
I · American Quarter Horse Association · United Auto Workers I
· Communication Workers of America I
I . Minnesota Quarter Horse Racing Association
. The Horsemen's Benevolent and Protective Association . International Association of Machinists \
I · The Tri-State Horsemen's Association · Iron Workers Local 512 \
I . The Central State's Dressage and Eventing Association · Minneapolis Central Labor Union I
I · MN State Pipe Trades I
I Local Support · Teamsters DRIVE
\ I
I . Backed by the entire Scott County legislative delegation I
I . Endorsed by both the city of Shakopee and Scott County I
I . Supported by 74% of Scott County residents* I
* According to a January 2004 poll conducted by Decision Resources Ltd. I
I
I
\ Canterbury Park Publication. March 2005 I
----~ ~- - -------.-- --
A.L1cKPOT FOR ALL MINNESOTANS--
Racinos In Other States ~
Racinos are a proven model for gaming across the country. Ten Racinos - Where Does the Revenue Go?
states have already approved Racinos, and are enjoying the benefits Total Share to
of enhanced state tax revenues, a stronger horse and agriculture State Share Local Share Governments
industry, and the creation of new jobs and investment. Minnesota 45% 2% 47%
Since the Minnesota legislature adjourned last May, two more states National Average 36% 1% 37%
- Oklahoma and Pennsylvania - have added the growing list of Delaware 41% 0% 41%
states approving Racinos. Iowa 25% 1% 26%
Unlike other gaming models, Racinos have a significant impact on Louisiana 30% 3% 33%
Maine 19% 1% 20%
a state's horse and agriculture economy. Since 1999, the year New Mexico 25% 0% 25%
Racinos were approved in New Mexico, the state has witnessed: New York 60-73% 0% 60-73%
· 216% growth in the amount of money spent on alfalfa and grain; Oklahoma* 19-39% 0% 19-39%
· 324% growth in the amount spent on veterinary services; and Pennsylvania 39% 4% 43%
· 413% growth in the amount spent on horse trailers. Rhode Island 53-58% 1% 54-59%
West Virginia 35% 2% 37%
In every state where they have been implemented, Racinos have
enhanced the agriculture economy while delivering vital tax * Oklahoma uses a slidil1g scale based 011 reUl!I1ue.
revenues to the state coffers. A glance at the tax rates of Racinos
across the country shows the Canterbury Park model would be one
of the most successful at raising new tax revenue for the state. Iowa Racino Flourishes
A closer look at our neighbors I
Other States considering authorizing Racinos Racino Stats
Florida Maryland
Indiana New Hampshire Authorized: 1994
Kansas Texas Slots: 3,513 I
Kentucky '04 Gross State Revenue: $89.0 million
Prairie Meadows Racetrack was bankrupt and its doors were I
And the list keeps growing. . . closed when the addition of slots was approved in 1994. Since
then, the racino has produced huge benefits for the Iowa's horse
industry.
10 STATES From 1995 to 1997, Iowa became the nation's fastest-growing
thoroughbred breeding state, jumping from 28th to 12th
nationally in total foals bred. The annual spending for the care
have already and maintenance of horses increased from $41 million in 1995 to
$97 million in 1999 according to Iowa State University.
In 2002, Polk County residents voted to approve the racino for
APPROVED another eight years. Sixty-six percent of the voters supported the
racino - a larger margin of victory than was originally achieved
in 1994.
RACINOS
,
Canterbury Park Publication. March 2005 ____J
-'- - - -- ~ ----- --
'-'
Horse A 'uCKPOT FOR ALL MINNESOTAN1-
Industry Generates ~
Nearly $1 Billion . Minnesota
In
An analysis released last year by the University of Minnesota Radno Would Grow The Race & Show Horse Industries
found that the equine industry has a significant impact on The Racino at Canterbury Park would provide a major boost for
Minnesota's agricultural economy. Minnesota's horse industry Minnesota's horse industry with new horse racing and showing
generates nearly $1 billion in economic activity every year in opportunities.
Minnesota, and could have even more economic impact with
further investments in horse racing and horse shows. · The Racino would add an additional $16 million annually to
racing purses, nearly tripling their current value. Purse
The report, authored by Brian Buhr, Associate Professor of growth would spark increased breeding levels throughout
Applied Economics at the University of Minnesota, found that Minnesota and enhance the economic impact of Minnesota's
Minnesota ranks 9th in the country in number of horses, which horse industry.
result in $930 million in direct and indirect economic benefit.
· The Racino would allow for the construction of a world-class
"Minnesota has a thriving horse population," said Buhr. "With equestrian center at Canterbury Park capable of hosting local,
155,000 horses currently being raised here, we have significant regional and national shows.
horse activity in every county. That means lots of work for horse · The equestrian park would draw substantial tourism dollars
trainers, veterinarians and farmers throughout Minnesota." into Minnesota as well as provide a centerpiece for
Potential For Growing Our Horse & Agricultural Economy Minnesota's show horse community.
While the horse industry already generates nearly $1 billion in
economic impact, the report found there is plenty of room for .,
industry growth. Even though Minnesota ranks 9th in the total Curtis Gardner
Gardner Fence Company
number of horses, it ranks 45th in sales value per horse. Minneapolis, Minnesota
"If we want to increase the total value and economic impact of Racino ~RPorter
horses, the best investment would be in stronger horse racing
and horse shows," explained Buhr. "Show horses generate twice
the economic value of pleasure horses, and race horses generate
nearly five times the impact."
University of Minnesota
Horse Industry Analysis
Highlights
· Minnesota's horse industry generates
$930 million of economic impact annually
I for the state.
· Minnesota ranks 9th nationally in the
total number of horses (155,000), with a
significant horse population in all 87
Minnesota counties.
· The value of Minnesota's horse
population ranks a distant 45th in the
country.
· Investments in both the show and race
horse industries would raise the value
and impact of Minnesota's horse industry.
--
Canterbury Park Publication. March 2005
~......
A JJ.CKPOT FOR ALL MINNESOTANS--
History of Canterbury Park ~
Early Years at the Downs Commitment To Community
Horse racing came to Minnesota in 1985 when Canterbury Downs In 2003, Canterbury Park Holding Corporation upped the ante in
opened its gates in Shakopee. The track opened to enthusiastic our long tradition of charitable giving, pledging through the
acclaim and high expectation for development of a new industry in Minnesota Keystone Program to give back at least five percent of
Minnesota - horse racing. pre-tax profits to charity annually.
But in the late 1980s and early 1990s, pressure from additional As part of that initiative, Canterbury Park founded the Canterbury
gaming had a devastating effect on track operations. During the Park Minnesota Fund, a donor-advised community fund. Under
1980s, Minnesota saw significant growth in the charitable gambling the mission of giving to organizations that benefit equine and
sector, followed by the authorization of the Minnesota Lottery in agricultural causes, local communities and responsible gaming
1989. Tribal gaming compacts were first signed with the state in programs, the fund approved over $100,000 in grant monies during
1988, and Mystic Lake opened its doors in 1992 just 5 miles from its initial round of giving.
Canterbury Downs.
In the past two years alone, Canterbury Park has given over
The odds were too much to overcome, and after the 1992 racing $600,000 in money, merchandise and services to charities across
season Canterbury Downs closed. Minnesota.
Racing Revival Under New Management
That's when several local horsemen, led by Curtis and Randy
Sampson and Dale Schenian, stepped in. They weren't interested in
owning the track, but after a year of struggling to find investors they
decided to do it themselves. The Canterbury Park Holding
Corporation was formed and the track was purchased in 1994.
Canterbury Park is a publicly traded company (Amex: ECP) with
over 2,500 shareholders, the majority of whom are Minnesotans.
Live racing returned to Canterbury Park in 1995 and the track made
a small profit in 1996. Purses gradually increased and the racing
season lengthened as customer support continued to grow. Today,
over 1 million visitors attend horse racing, concerts, fairs and other
live events at Canterbury Park, with more than 1,000 people
employed at the facility.
Card Oub Injection
In 1999, the Minnesota Legislature agreed that racing purses needed
a boost, and authorized the Canterbury Card Club. In just under
four years, the Card Club has helped revive Minnesota's horse
industry. Race purses have increased by more than $4 million,
which drives Minnesota's breeding industry. Although still not
back to the levels of the mid-1980's, the number and value of
Minnesota-bred horses has risen since the opening of the club.
Canterbury Park is about to start its eleventh year of managing
gaming in Minnesota. Its success as a responsible manager of
gaming and entertainment has been recognized nationally. In 2001,
Forbes Magazine named Canterbury Park as one of the 200 best
small companies in America.
Canterbury Park Publication. March 2005 CANTER
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RACINO AT CANTERBURY PARK - MASTERPLAN
I
150,000 SQ IT I I
I
CASINO WITH TABLE
AND SLOT GAMING
I 250 ROOM HOTEL
BALCONY ROOMS
OVERLOOKING TRACK
HORSE SHOW BARNS - 3 OlITDOOR
400 STALLS SHOW ARENAS RACEHORSE BARN AREA -
130' X 300' 1650 STALLS FOR LIVE RACING
(2) INDOOR HORSE SHOW ARENAS
175' X 300' WESTERN SHOW
&140' X 300'
ARENAS & PENS
125' X 275'