Latest news with #BillCarstanjen
Yahoo
5 hours ago
- Business
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‘Left With No Choice': Churchill Downs Inc. Moves To Relinquish Fair Grounds License In Louisiana
'Left With No Choice': Churchill Downs Inc. Moves To Relinquish Fair Grounds License In Louisiana originally appeared on Paulick Report. Doubling down on statements made last month about not opening Fair Grounds Race & Slots in New Orleans for a live horse racing meet this fall, Churchill Downs Inc.'s chief executive officer informed the Louisiana State Racing Commission the company plans to 'begin the next steps' to relinquish its live racing and OTB license, along with its slots and video poker licenses, at the racing commission's next meeting. In a June 9 letter to racing commission officials – obtained by the Paulick Report – Bill Carstanjen, the chief executive officer of CDI, said the loss of historical horse racing (HHR) revenue, following an adverse state Supreme Court ruling, and newly enacted legislation has forced the company's hand. Advertisement Related: Situation 'Dire': Fair Grounds May Not Run 2025-'26 Race Meet Without Legislative Help 'Given the legislature's ease with which it approved legislation that is directly adverse and harmful to the economic interests of Fair Grounds, the opposition by elected officials to engage in meaningful solutions in collaboration with the Fair Grounds, and the forthcoming adjournment of the legislative session,' Carstanjen wrote, 'CDI is left with no choice but to request an appearance before the LSRC to begin the next steps for voluntarily surrendering the racing license held by the Fair Grounds.' Carstanjen added: "This is not the path CDI wishes to proceed down, but the inaction from elected officials to offer any sort of compromise has made this the only possible outcome. ... Closing one of the nation's oldest racetracks, and the most important track in Louisiana, will be a devastating blow to Louisiana's equine industry and the New Orleans economy. It will also have an immediate detrimental impact on the livelihoods of the hundreds of employees, local vendors, and community surrounding the Fair Grounds." At an emergency meeting of the Louisiana commission on May 13, Ozair Shariff, an attorney for CDI, warned commissioners that without some form of legislative assistance to make up for the loss of HHR revenue, Fair Grounds would not apply for racing dates in the fall, calling the situation 'dire.' Reading from a statement at the May meeting, Shariff said: 'Fair Grounds' overall profitability is dependent on revenue generated from its OTB network, specifically video poker and historical racing – until last week (when the Supreme Court decision on HHR took effect). The elimination of 46 percent of the OTB revenue and an even more significant 74 percent of OTB EBITDA does not allow Fair Grounds to cover its required $9 million average annual maintenance operating capital. Faced with this reality, operating under the current status quo is no longer an option.' Shariff said efforts to engage members of the Louisiana legislature, whose session ends on June 12, was a priority, in hopes of getting some type of relief. Shariff was rebuked at the meeting by Louie Roussel III, a prominent New Orleans businessman who formerly owned Fair Grounds and is a longtime Thoroughbred owner and trainer. Roussel, who said he was speaking on behalf of Gov. Jeff Landry, addressed the commission, telling them, 'Do not allow these people to do this. … If they tell you they don't want to race, fine them $50,000 or $100,000 a day for every day they don't race. 'There will be no state subsidy for this racetrack,' Roussel added. 'None.' Apparently, Roussel was correct. Advertisement Legislators did pass two bills that Carstanjen said would be damaging to CDI's bottom line: the first expands the permitted number of video poker machines at truck stops (from 50 to 60) and bars (from three to four). The second bill would permit fixed odds wagering on horse racing. The legislation created a fund for Louisiana purses, but nothing for track operators. Following is Carstanjen's letter to the Louisiana State Racing Commission, in full: June 9, 2025 Mr. Edward J. Koehl, Jr., Chairman Louisiana State Racing Commission Mr. Stephen Landry, Executive Director Louisiana State Racing Commission 320 N Carrollton Avenue Suite 2-B New Orleans, Louisiana 70119-5100 RE: LSRC Meeting and Fair Grounds' Racing License Dear Chairman Koehl and Executive Director Landry: It is my understanding that soon after the Louisiana Legislature adjourns on June 12, 2025, an emergency meeting of the Louisiana State Racing Commission ("LSRC") will be conducted. This correspondence is Churchill Downs Incorporated's ("CDI") formal request to appear at the meeting to discuss the timeline and next steps concerning the license held by Churchill Downs Louisiana Horseracing Company, L.L.C. d/b/a Fair Grounds Racecourse & Slots ("Fair Grounds"). For the last few months, CDI has attempted to engage in good faith discussions with elected officials and various other industry stakeholders to find a path toward long term economic viability for the Fair Grounds after the recent decision of the Louisiana Supreme Court that resulted in the elimination of historical horse racing ("HHR"), and nearly half of the Fair Grounds' off-track betting ("OTB") revenues. To date, our efforts to engage elected officials have not led to meaningful discussions and, confoundingly, CDI's efforts have been met with a combination of reluctance, indifference, apathy, and even opposition. To make matters worse, the passing of HB 540 and 547 further negatively impacts the Fair Grounds' ability to remain competitive. House Bill 540 will lead to significant cannibalization of revenue from our OTB network in and around greater New Orleans, a network in which the Fair Grounds has heavily invested since 2005 - the only racetrack operator in the state to do so. House Bill 547 will shift wagering handle from current brick and mortar racetracks, OTBs, and advanced deposit wagering platforms, all of which provide revenues to track operators and local horsemen groups, to out-of-state bookmaking operators. Given the legislature's ease with which it approved legislation that is directly adverse and harmful to the economic interests of Fair Grounds, the opposition by elected officials to engage in meaningful solutions in collaboration with the Fair Grounds, and the forthcoming adjournment of the legislative session, CDI is left with no choice but to request an appearance before the LSRC to begin the next steps for voluntarily surrendering the racing license held by the Fair Grounds. The timing of the LSRC's meeting, and the date on which the Fair Grounds ceases its operations for not committing to run a 2025-2026 race meet, necessarily implicates the Louisiana Gaming Control Board ("LGCB") and the Fair Grounds' slot license, the surrender of which may not occur without the prior approval of the LGCB. To be clear, we expect to surrender our slot and video poker licenses. This is not the path CDI wishes to proceed down, but the inaction from elected officials to offer any sort of compromise has made this the only possible outcome. Fair Grounds provides nearly $30 million in taxes to local municipalities and the State of Louisiana, in addition to well over $34 million in purse money for its racing product. Closing one of the nation's oldest racetracks, and the most important track in Louisiana, will be a devasting blow to Louisiana's equine industry and the New Orleans economy. It will also have an immediate detrimental impact on the livelihoods of the hundreds of employees, local vendors, and community surrounding the Fair Grounds. However, the inaction of the legislature and others in a position to save this racetrack have forced us into the current situation. Please provide the details of the meeting at your earliest convenience. William C. Carstanjen Churchill Downs Incorporated, CEO cc: Mr. Jeff Landry, Governor Mr. Cameron Henry, Senate President Mr. Phillip DeVillier, Speaker of the House Mr. Jimmy Harris, Senator Mr. Bernard Chatters, President of the Louisiana HBPA Mr. Patrick Bernard, LSRC Commissioner Mr. Rock Bordelon, LSRC Commissioner Mrs. Leslie Bouie, LSRC Commissioner Mr. Larry Findley, LSRC Commissioner Mr. K.R. Finkelstein, LSRC Commissioner Mr. Nathan Granger, LSRC Commissioner Mr. Earl Landry, LSRC Commissioner Mr. Travis Miller, LSRC Commissioner Mr. Deano Thornton, LSRC Commissioner Mr. Vincent Tuminello, LSRC Commissioner Mrs. Katherine Winters, LSRC Commissioner This story was originally reported by Paulick Report on Jun 10, 2025, where it first appeared.
Yahoo
01-05-2025
- Business
- Yahoo
Kentucky Derby 2025: Rome before the fall?
A $200 million paddock redesign completed last year caps more than $500 million in capital projects at Churchill Downs over the last two decades. CEO Bill Carstanjen says the changes at the Louisville track 'drove the Derby experience and our financial results to a level we could not have imagined just a few years ago.' (Churchill Downs photo) After ballyhooed changes for its sesquicentennial last year and the 50th anniversary of Secretariat's win the year before, the Kentucky Derby is set to revert to norm Saturday at Churchill Downs in Louisville. It won't be its mid-20th century norm of Whirlaway and Citation, British royals and Hollywood stars, movie newsreels and Time magazine covers, of course, or the half-life reburst of that era epitomized by Secretariat. Or the subsequent coasting on old glories and nostalgic Americana. Those times were based largely around a curated commonality — the sport of horse racing, real and imagined — and are ancient history. The current norm is a lot more corporate and complicated and revolves around an unsought intersectionality of the business and politics of horse racing, broadly defined. Start with Churchill Downs Inc., the track's corporate parent. Formed in 1950, CDI was low-profile for decades but has morphed into a publicly-traded, nationally leading racing, online wagering and gaming company, with some 29 casinos and racing properties across 14 states. It had record net revenue of $2.7 billion last year, up 11% from 2023. Numbers for the Derby last year showed a record $320.5 million wagered from all sources on Derby day and on the Derby race alone a record $210.7 million. Attendance of 156,710 was the highest since 2018 (the record of 170,513 was set in 2015). And the race attracted an average 16.7 million viewers on NBC and Peacock, the most since 1989. Over the past two-plus decades, CDI has spent more than $500 million on capital projects at Churchill, capped by a $200 million paddock redesign completed last year that CEO Bill Carstanjen said 'drove the Derby experience and our financial results to a level we could not have imagined just a few years ago.' In February, CDI announced plans for $920 million in projects to expand and renovate its infield and grandstand and improve its infrastructure. The projects, slated to begin this year and be completed in 2028, were paused last week, CDI said, due to increasing uncertainty surrounding construction costs related to tariffs, trade disputes and current economic conditions. Its completed projects have turned Churchill, a National Historic Landmark site, into a modernized physical plant that dominates what remains of the working-class South Louisville neighborhood around it. (Over recent decades, CDI has acquired numerous properties in the neighborhood to construct grand entrances and add landscaped and parking areas.) Inside its gates, there are a plethora of new and renovated hospitality spaces, suites and rooms at almost every turn, shaping an overall milieu Churchill terms an 'experience.' The track has become an entertainment facility, with racing, including to an increasing extent the Derby, more plotline than raison d'etre. Except for the iconic 1895 twin spires, vestiges of its pre-renovation past — sprawling betting and concession spaces packed with motley crowds, hidden corridors, brick walkways, a crowded paddock, a wide-open and raucous infield, trough urinals in men's rooms, beer on tap — disappear year by year and the environment becomes less soulful and more gentrified and risk-averse. For the Derby, the certainty of Churchill's corporate march is being intersected more and more by the uncertain state of American racing. For decades, the sport has faced predictions of demise, given its aging fan base, marginal TV coverage and competition from lotteries, casinos and online sports betting. Its current troubles include shrinking field sizes, reduced purses and the closing of major tracks, including Hollywood Park in greater Los Angeles (where the first Breeders Cup was held and now the site of SoFi Stadium) and Arlington Park near Chicago. The Derby's attendance, financial and television numbers, which seem to break records each year, belie the demise. But then there are the numerous racing-related drug scandals and on-track horse deaths that have become recurring national news in the past decade. The drug scandals have involved prominent trainers and led to suspensions and federal indictments and convictions. The deaths have forced major tracks to close for investigations of surfaces and training practices. (Nationally, racehorse fatalities have been decreasing, with the rate last year falling to its lowest level in 16 years.) Both drugs and deaths have directly impacted Churchill. In 2021, Medina Spirit, who finished first in the Derby, was disqualified for failing a post-race drug test. That led to a protracted and very public legal battle involving the horse's high-profile trainer, Bob Baffert, owner Amr Zedan and Churchill. The track prevailed and Baffert, whose horses have won a record-tying six Kentucky Derbies, was banned from Churchill for three years. He returns this year and has two horses running in the Derby. Churchill also became a focus of media and public attention when 12 horses died at the track during its 2023 spring meet. Two of the deaths occurred on Derby day. The track suspended racing to investigate the situation and moved the remainder of its meet to Ellis Park (also owned by CDI) in Western Kentucky. Last year, 13 horses died racing or training at Churchill. And just last week, a three-year-old horse was euthanized on the track after fracturing his front legs during a morning workout. The politics of racing have catalyzed around drug and death issues and gained widespread traction. In 2020, after years of lobbying by groups from The Jockey Club to PETA, Congress authorized the Horseracing Integrity and Safety Authority (HISA) to develop and implement a national, uniform set of safety and anti-doping and medication rules. It's now in effect at 47 tracks in 19 states. (PETA continues to push for stricter horse safety standards and investigate and highlight racing's underside.) Racing's most recent political issue is decoupling, which surfaced in Florida early this year when the owners of Gulfstream Park, a leading national track, proposed separating the facility's racetrack from its casino, ending casino revenues supporting racing and closing the track in a few years. Though strongly opposed by Florida horsemen, legislation allowing the decoupling passed the state House and a Senate committee. Gov. Ron DeSantis has indicated his opposition and its outcome is unclear. Many in the industry believe that, if approved in Florida, decoupling would set a precedent and jeopardize racing across the country. Churchill wouldn't be affected by such a scenario since casinos aren't legal in Kentucky. But the track is closely coupled to historical horse racing (HHR), an electronic gambling product where players bet on replays of races on slot machine-like terminals. HHR, along with live racing, accounted for $1.3 billion of CDI's $2.7 billion net revenue last year and it provides significant support for Churchill's racing purses, including the Derby's $5 million one. Despite its success in Kentucky, HHR hasn't become a panacea for American racing. Its legality as pari-mutuel wagering (as opposed to slot machine gambling) has frequently been challenged, and it's allowed in only a handful of states. In March, it was struck down by the Louisiana Supreme Court for operating in the state without voter approval. That decision led CDI to announce a 25% cut in purses at Fair Grounds, the New Orleans racetrack it owns. For CDI and the Derby, HHR and ongoing record profits, popularity and expansion is the bull-market side of its current norm. What to make of the bear-market side — drugs, deaths, track closings and the like — is the question. Is it all much ado about nothing or a portent of the Colosseum and Rome before the fall? So far, the main response seems to be deferral or, every now and then, a muted 'But not yet. … Not yet.' SUBSCRIBE: GET THE MORNING HEADLINES DELIVERED TO YOUR INBOX
Yahoo
25-04-2025
- Business
- Yahoo
Churchill Downs Incorporated Announces Updates on Capital Projects for Churchill Downs Racetrack
New Renovations for Finish Line Suites and The Mansion; Temporary Pause of The Skye, Conservatory and Infield General Admission Projects LOUISVILLE, Ky., April 23, 2025 (GLOBE NEWSWIRE) -- Churchill Downs Incorporated ('CDI' or 'the Company') (Nasdaq: CHDN) announced today renovations of the existing Finish Line Suites and The Mansion at Churchill Downs Racetrack with expected completion in April 2026. After careful consideration, CDI has decided to pause the multi-year projects to develop The Skye, Conservatory and Infield areas. The decision to delay these construction projects is due to the increasing uncertainty surrounding construction costs related to tariff and trade disputes as well as current macro-economic conditions. In the coming months, CDI will assess the evolving economic landscape and evaluate any changes to the timing and sequencing of these multi-year projects. The renovation of the Finish Line Suites will update the existing 15 suites on the fifth floor overlooking the finish line at Churchill Downs Racetrack, providing modern interior appointments and amenities while also increasing the capacity to a total of 750 guests. The renovation of the Trophy Room, which sits behind the Finish Line Suites with capacity for over 300 guests, will add updated finishes and a new feature bar. The improvements to these areas will together create a larger, fully integrated hospitality experience with more vibrancy, better guest flow and superior amenities. The Mansion, built in 2013, is one of the most exclusive areas at Churchill Downs Racetrack. Located on the sixth floor, The Mansion provides an exclusive aerial view of the finish line and an expansive perspective of the entire property. Renovation of The Mansion will introduce updated finishes and other enhancements. CDI expects to spend approximately $25-30 million on these new capital projects. 'We are pleased to announce these new projects designed to significantly improve the Finish Line Suites and The Mansion which are two of our most exclusive areas of the racetrack,' said Bill Carstanjen, Chief Executive Officer of CDI, 'The decision to pause the Skye Terrace and infield projects was a difficult one for us to make because we do not want to disappoint our fans; however, we have a responsibility to be disciplined given the recent changes in the economic environment. We remain committed to growing our iconic flagship asset over the long term with projects that will provide new once-in-a lifetime experiences for our guests and deliver best-in-class shareholder returns.' About Churchill Downs Incorporated Churchill Downs Incorporated ('CDI') (Nasdaq: CHDN) has been creating extraordinary entertainment experiences for over 150 years, beginning with the company's most iconic and enduring asset, the Kentucky Derby. Headquartered in Louisville, Kentucky, CDI has expanded through the acquisition, development, and operation of live and historical racing entertainment venues, the growth of online wagering businesses, and the acquisition, development, and operation of regional casino gaming properties. This news release contains various 'forward-looking statements' within the meaning of the 'safe harbor' provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are typically identified by the use of terms such as 'anticipate,' 'believe,' 'could,' 'estimate,' 'expect,' 'intend,' 'may,' 'might,' 'plan,' 'predict,' 'project,' 'seek,' 'should,' 'will,' 'scheduled,' and similar words or similar expressions (or negative versions of such words or expressions), although some forward-looking statements are expressed differently. Although we believe that the expectations reflected in such forward-looking statements are reasonable, we can give no assurance that such expectations will prove to be correct. Important factors, that could cause actual results to differ materially from expectations include the following: the occurrence of extraordinary events, such as terrorist attacks, public health threats, civil unrest, and inclement weather, including as a result of climate change; the effect of economic conditions on our consumers' confidence and discretionary spending or our access to credit, including the impact of inflation; changes in, or new interpretations of, applicable tax laws or rulings that could result in additional tax liabilities; the impact of any pandemics, epidemics, or outbreaks of infectious diseases, and related economic matters on our results of operations, financial conditions and prospects; lack of confidence in the integrity of our core businesses or any deterioration in our reputation; negative shifts in public opinion regarding gambling that could result in increased regulation of, or new restrictions on, the gaming industry; loss of key or highly skilled personnel, as well as general disruptions in the general labor market; the impact of significant competition, and the expectation that competition levels will increase; changes in consumer preferences, attendance, wagering, and sponsorships; risks associated with equity investments, strategic alliances and other third-party agreements; inability to respond to rapid technological changes in a timely manner; concentration and evolution of slot machine and historical racing machine (HRM) manufacturing and other technology conditions that could impose additional costs; failure to enter into or maintain agreements with industry constituents, including horsemen and other racetracks; inability to successfully focus on market access and retail operations for our sports betting business and effectively compete; online security risk, including cyber-security breaches, or loss or misuse of our stored information as a result of a breach including customers' personal information could lead to government enforcement actions or other litigation; costs of compliance with increasingly complex laws and regulations regarding data privacy and protection of personal information; reliance on our technology services and catastrophic events and system failures disrupting our operations; inability to identify, complete, or fully realize the benefits of our proposed acquisitions, divestitures, development of new venues or the expansion of existing facilities on time, on budget, or as planned; difficulty in integrating recent or future acquisitions into our operations; cost overruns and other uncertainties associated with the development of new venues and the expansion of existing facilities; general risks related to real estate ownership and significant expenditures, including risks related to environmental liabilities; personal injury litigation related to injuries occurring at our racetracks; compliance with the Foreign Corrupt Practices Act or other similar laws and regulations, or applicable anti-money laundering regulations; payment-related risks, such as risk associated with fraudulent credit card or debit card use; work stoppages and labor problems; risks related to pending or future legal proceedings and other actions; highly regulated operations and changes in the regulatory environment could adversely affect our business; restrictions in our debt facilities limiting our flexibility to operate our business; failure to comply with the financial ratios and other covenants in our debt facilities and other indebtedness; increases to interest rates (due to inflation or otherwise), disruption in the credit markets or changes to our credit ratings may adversely affect our business; increase in our insurance costs, or inability to obtain similar insurance coverage in the future, and any inability to recover under our insurance policies for damages sustained at our properties in the event of inclement weather and casualty events; and other factors described under the heading 'Risk Factors' in our most recent Annual Report on Form 10-K and in other filings we make with the Securities and Exchange Commission. We do not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. Investor Contact: Sam Ullrich Media Contact: Tonya Abeln (502) 638-3906 (502) 386-1742 Photos accompanying this announcement are available at in to access your portfolio
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Miami Herald
23-04-2025
- Business
- Miami Herald
Churchill Downs pausing renovations due to Trump tariffs ahead of 2025 KY Derby
Churchill Downs on Wednesday announced that the Kentucky racetrack, soon to host the annual Kentucky Derby, is pausing a major expansion due to President Trump's tariffs and overall economic uncertainty. The Louisville-based gambling and racing company made the announcement as it released first-quarter earnings, which were overall positive with record net revenue. But the company said it would pause capital projects released earlier this year 'due to the current economic environment.' In February, Churchill Downs announced plans for a nearly $1 billion expansion, its largest ever, to begin later this year and extend through 2028. The projects were to revamp the existing Skye Terrace into more premium hospitality experiences; create permanent premium seating in the infield; and add infield structures for the General Admission area as well. Now, Churchill says, those will be delayed. 'The decision to delay these construction projects is due to the increasing uncertainty surrounding construction costs related to tariff and trade disputes as well as current macro-economic conditions,' Churchill Downs said in a news release. 'In the coming months, CDI will assess the evolving economic landscape and evaluate any changes to the timing and sequencing of these multi-year projects.' The decision to pause the Skye Terrace and infield projects 'was a difficult one for us to make because we do not want to disappoint our fans,' said Bill Carstanjen, chief executive officer of Churchill Downs Inc., in the release. 'However, we have a responsibility to be disciplined given the recent changes in the economic environment. We remain committed to growing our iconic flagship asset over the long term with projects that will provide new once-in-a lifetime experiences for our guests and deliver best-in-class shareholder returns.' Churchill also announced two new projects with smaller price tags, geared toward deep-pocketed fans and bettors, that will continue: renovations of the existing Finish Line Suites and The Mansion. The total cost of those two new projects is a more modest $25 million to $30 million, according to the announcement. 'We are pleased to announce these new projects designed to significantly improve the Finish Line Suites and The Mansion, which are two of our most exclusive areas of the racetrack,' Carstanjen said. Churchill Downs executives will hold a conference call with investors at 9 a.m. ET Thursday to discuss the quarter's results, which do not include the upcoming Kentucky Derby on May 3.
