Established in 1998, Ontario’s Slots at Racetracks Program brought a windfall to racing in the Canadian province with 20 percent of revenue from new slot machine parlors at racetracks directed to the industry. The government’s sudden decision to cancel the program in 2012 dealt a nearly fatal blow to racing and breeding in Ontario. Two years later, veteran Canadian racing journalist Dave Briggs explores the ill-fated slots era in a six-part series with an eye toward lessons for racing jurisdictions in America that derive revenue from other forms of gaming.
Read part 1: Lessons for every slots jurisdiction
Read part 2: How tracks ended up with slots
Read part 3: Ontario’s rich racing heritage
Read part 5: Why slots were cancelled
Read part 6: What other jurisdictions must learn from Ontario
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In December 1995, when David Willmot became president of what was then called the Ontario Jockey Club (OJC), the Toronto company was heavily in debt and just three months from breaking its banking agreement.
For an outfit that accounts for about 75 percent of every dollar wagered on horse racing in Canada, the company’s financial woes spelled big trouble for a sport that continued to see its handle and attendance decrease in the 1990s.
Two years prior to Willmot taking charge, the OJC — later to rebrand itself as the Woodbine Entertainment Group (WEG) — had tried to stem the bleeding by selling off Greenwood Raceway in downtown Toronto to developers (retaining enough land on the site to open a large teletheatre). Yet the company was still some CA$40 million in the hole after the sale of the venerable old track on the shores of Lake Ontario.
Willmot was a key part of the lobbying effort to have the provincial tax on pari-mutuel wagering reduced to place horse racing on par with the rate for Ontario’s other gaming products. But he, and all of racing, caught a huge break just six months after he took the reins of the OJC when the Ontario government not only reduced the pari-mutuel tax from nine to 0.5 percent, but also paved the way for tracks to add slot machines.
Just like that, the company entered a 15-year renaissance driven by its not-for-profit status and a chief mandate to enhance horse racing ahead of the bottom line.
In October 1996, Woodbine became the first — and still only — track outside of the United States to host the Breeders’ Cup.
In 1997, the OJC sold Fort Erie Racetrack near the border crossing to Buffalo, N.Y., leaving the company with just two tracks — Woodbine Racetrack near Pearson Airport in Toronto, a facility used by both Thoroughbreds and Standardbreds, and the beloved harness-only facility Mohawk Racetrack west of Toronto in the city of Milton, Ontario.
The same year, the OJC introduced its advance deposit wagering platform HorsePlayer Interactive (HPI) that would grow into a nationwide system, which served both as a telephone and Internet wagering service and a television distribution system.
In 1998, OJC tracks dropped paid admission. The same year, Willmot was key in helping negotiate a 20 percent cut of slot machine revenue for the industry to offset the inevitable cannibalization of racing customers. The final deal was signed in June, and the OJC immediately began massive upgrades to its facilities, including a whopping CA$100 million to overhaul much of the Woodbine grandstand to add a 1,700-machine slot hall and make other major improvements to a tired plant that had seen little change since it opened in 1956.
In fact, due to the extent of the construction at Woodbine, it was actually Mohawk Racetrack that opened its 750-machine slot hall first, in August 1999. The Woodbine slot parlour opened eight months later, on March 27, 2000. Throughout the Slots at Racetracks Program (SARP) era, Woodbine and Mohawk consistently ranked first and third, respectively, in slot machine revenue among all tracks in the province.
In 2001, the Ontario Jockey Club officially became the Woodbine Entertainment Group to better position itself as an entertainment company, shed a name that didn’t accurately reflect it as a dual-breed racing operation and remove any hint that it was a hoity-toity “club” — a misnomer that dogged the OJC during its pre-slots halcyon era.
One of WEG’s key early investments was spending some CA$5 million to make crucial upgrades to its television operations. It greatly expanded the department and paid to produce its own weekly shows for both racing breeds that aired on a national cable sports network and gave horse racing mainstream exposure.
The slot era also led the company to invest heavily in expanding its Champions teletheatre network in the Greater Toronto Area, which included opening racing-themed restaurants The Turf Club on Bay Street in the city’s financial district, and WEGZ Stadium Bar in the heart of the northern suburbs.
Other major renovations would follow to both of its tracks, including surface expansions and improvements, new paddocks, tote boards, and lights. In all, WEG invested approximately CA$400 million in improvements in the slot era. Meanwhile purses soared to unprecedented levels.
Though wagering on horse racing was still soft, all in all, it was a glorious time that came to an abrupt end when Ontario’s finance minister Dwight Duncan sideswiped the industry in the winter of 2012.
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Tomorrow: Why the Slots at Racetracks Program was cancelled
Dave Briggs is the co-editor of Canadian Thoroughbred magazine and a freelance horse racing columnist and features writer. For 18 years, he was the editor of harness racing trade publication The Canadian Sportsman.