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Off-track betting issue still murky: Arizona Downs official hopes for ‘even playing field’

Two days before Arizona Downs resumes its inaugural horse racing season, track general manager Ann McGovern said Wednesday, July 17, that she is thankful Turf Paradise in Phoenix has backed away from suing the state over a new law opening off-track betting signals to all Arizona racetracks.

Due to a dispute with Turf Paradise and OTB signal provider Monarch Content Management Co., Arizona Downs, 10501 E. Highway 89A in Prescott Valley, closed for the rest of the season on June 21. But the track reopened on July 1 when it received financing from Mike Barro, the owner of Barro’s Pizza in Phoenix.

Arizona Downs’ season resumes at 1 p.m. Saturday, July 20.

“The legislation is beneficial for everybody in Arizona racing, so it’s a good move on their part,” McGovern added about Turf Paradise’s decision. “I’m hoping this is a step in the direction of year-round racing being strengthened and good for everybody involved.”

However, Monarch, an OTB signal provider for several large racetracks in California, continues to say the state should not try to dictate which Arizona racetracks OTB signal providers must sell their content to. When the new law goes into effect in late August, Monarch plans to entirely cut off its signals to Arizona.

“If everything’s on an even playing field, then I’m sure we’ll be successful,” McGovern said. “Of course we’d rather have the Monarch signals in all of Arizona, in Turf Paradise’s OTBs and ours. That, to me, is the best thing that could happen.”

Monarch has said it wants to continue doing business with Turf Paradise, but it views Arizona Downs as dipping its toes into Turf Paradise’s OTB market.

“We have been in contact with Monarch for a year now, trying to negotiate a resolution to this,” McGovern said. “And when that was not successful, that’s why we went to the [Arizona] Legislature.”

McGovern disagrees with Monarch’s claim and she says she has shared data with Monarch to prove her point.

“We have data that shows that wherever we open an OTB site, the Turf Paradise sites closest to that site – their total numbers went up, as well as our numbers,” said McGovern, adding that when Arizona Downs briefly closed this season, Turf pursued its OTB sites in the Phoenix area. “So, we weren’t cannibalizing; we were actually growing the market.”

Monarch represents tracks that have traditionally productive racing content, such as Santa Anita and Del Mar.

“Monarch hasn’t given us a response as to what their plans are,” McGovern said. “Not having those signals available to our customers was a disadvantage.

“I don’t understand why they would not want to send their signal to other locations that would be beneficial for Arizona racing on the whole, as well as make them additional revenue.”

Arizona Downs has enough money to operate for 15 more dates this season, including July 20, 21, 27 and 28; Aug. 3, 4, 10, 11, 17, 18, 24, 25 and 31; and Sept. 1 and 2. The 2020 season could be a different story, though.

Currently, Arizona Downs operates six OTB sites, including three in the Phoenix area and one apiece in Lake Havasu, Flagstaff and Pinetop-Lakeside.

McGovern said Arizona Downs needs 20 to 30 OTB sites in Arizona to remain financially viable. The Downs seeks OTB sites in large population centers with particular demographics in underserved markets.

McGovern added that a “strong OTB program has always been the heart of our business plan.”

“We’ll move forward, no matter what Monarch decides, to get that OTB system up and operating,” she added. “And that’ll allow us to develop purses for next season.”

Arizona Downs receives OTB signals from several other content providers besides Monarch. On a Saturday, for example, the Downs could get upwards of 20-plus signals from racetracks across America, McGovern said. Bigger signal providers include NYRA (New York Racing Association) and TwinSpires (Churchill Downs).

“This has definitely been our major stumbling block,” McGovern said of developing purses, which depends on the OTB system. “Everything else has gone so smoothly. We couldn’t ask for better attendance.”

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