Nebraska Racetrack Report Could Sink New Casino Projects

Nebraska’s horse racetrack sector is right-sized and the data doesn’t support the need to issue any more racing licenses. That’s according to a new independent report commissioned by the state Racing and Gaming Commission that could put the kibosh on further casino expansion in the state.

Lawmakers asked the commission to examine the state’s horse racing and casino markets and their socioeconomic impact, to be repeated every five years. That’s after Nebraska voters legalized casino gaming by approving the state’s Racetrack Gaming Act in a 2020 ballot.

The vote amended the state constitution to allow commercial casinos at the state’s six licensed racetracks. The new law tied potentially lucrative casino gaming to horse racing, a less lucrative industry. This means any operator who wants to enter the casino market will first need to build or acquire a racetrack and gain a racing license from the state.

Protecting the Market

There’s no need for any more racetracks, according to the report, which has been viewed by The Lincoln Journal Star. The researchers assert there is “more than sufficient capacity with the state’s existing six racing licenses to allow for a tripling or quadrupling of racing in Nebraska,” as quoted by the Journal Star.

By law, the Racing and Gaming Commission is required to consider the possible socioeconomic impact of license applications. It is mandated to reject those that could be detrimental to the health of the existing market.

That’s potentially bad news for operators with an eye on Nebraska, who had already been prevented from applying for licensing before the report’s publication.

Chief among these may be John Hassett, president of Aksarben Equine, who is behind a project to build a $150 million racetrack in the city of Bellevue, part of the Omaha-Council Bluffs metropolitan area.

Of the $60.7 million in revenue the study estimates the Belleview casino would generate, $38.5 million would come from other operators. Some $27.4 million of that would come from the Warhorse, the study said.

Room for More?

Hassett told the Journal-Star he believes a license should only be rejected if a project is detrimental to the state’s overall market, rather than just one operator. He also noted that neighboring Iowa has 19 casinos and a population of 3 million, whereas Nebraska has just six casinos and a population of 2 million.

I don’t think the maximum is six. I think there’s probably room for several more, a couple out west, and I think there’s plenty of room for Bellevue,” he said.

Lance Morgan, CEO of Ho-Chunk Inc., disagrees.

“This study kills Bellevue,” he argued. “… The existing tracks are the ones that struggled and survived and put up the money and the time and effort to create the industry.”