RaciNO: Racing commission won't award new license

The New Mexico Racing Commission issued a big "no" on awarding a sixth racing license — not just to Tucumcari, but to everyone else who'd applied for one.

A principal member of an investment group that wants to build a “racino” in Tucumcari said he’d appeal to Gov. Michelle Lujan Grisham to intervene to have the commission reconsider.

The commission announced during its first regular meeting in more than two months Thursday it would not approve a sixth license. Applicants from Tucumcari, Clovis and Lordsburg had been jockeying for one for more than a year.

For Tucumcari, Coronado Partners had proposed building an $80 million racetrack and casino on the city’s east side between Route 66, U.S. 54 and Interstate 40. It would have employed up to 400 people.

Commission chairwoman Beverly Bourguet said the decision Thursday was in “the best interest” of the state, according a report from the meeting in Albuquerque by the Associated Press. Bourguet told The AP the commission doesn’t plan to reopen the process “in the near future.”

“The New Mexico Racing Commission (NMRC) at this time has decided not to issue a 6th racing license,” commission Executive Director Ismael “Izzy” Trejo reiterated in an email Thursday afternoon. “The NMRC has left open the possibility of issuing it in the future but not before significant analysis of the horse racing industry has been completed.”

Coronado Partners principal Warren Frost, a Logan attorney, said he was “not surprised but disappointed” by the commission’s decision Thursday.

“We knew it was going to be difficult with some of the commissioners because they’re very close to existing racetracks,” he said by phone Friday. “I don’t believe the governor is going to allow the industry that can create over 350 jobs in a community to not come to a community. We’re spending tens of millions of dollars in our state to promote the movie industry, and all we want is a license. We’re not asking for a penny.

“It doesn’t make sense, and I don’t believe the governor is going to stand by and allow them to simply say, ‘We’re not going to do it.’ I believe the governor is progressive and interested in promoting economic development in the entire state.

“We’re going to meet with the governor and ask her to intervene and make them grant this license.”

Because of compacts with tribes that operate casinos, only six racinos are allowed in New Mexico. The five operating racinos are in Hobbs, Ruidoso, Albuquerque, Farmington and Sunland Park.

Reaction by Tucumcari residents on social media was overwhelmingly negative when word of the commission’s decision trickled out Thursday afternoon.

Reached by cellphone Thursday while traveling in western New Mexico, Tucumcari Mayor Ruth Ann Litchfield expressed her dismay with the commission’s decision.

“I’m very disappointed,” she said. “I thought we had a good chance. I don’t know what else to say; I thought this (racino) would be good for us.”

Patrick Vanderpool, executive director of the Greater Tucumcari Economic Development Corp., also said by phone he was disappointed by the development.

“I believe the other racetracks didn’t want a sixth license because they thought they would loose earnings and revenue,” he said. “That had to play a part in it. I don’t agree with that assessment because the money the Tucumcari track would have earned would have been new money to come from West Texas and the Texas Panhandle.

“That means we have to get more aggressive with our business recruitment,” Vanderpool added.

Frost said he wouldn’t rule out legal action against the commission but acknowledged “that’s down the road.”

“Based on representations to the racing community, they were going to do this,” he said. “Who’s going to make everybody whole for that? They solicited the (applicants), came to our communities, and all the applicants have spent hundreds of thousands of dollars each. It’s just nonsensical.”

In mid-July, the commission and New Mexico Gaming Control Board reported tribal casino revenue sharing had fallen by 10% since fiscal year 2013. Nontribal gaming revenue also fell 3% over the same period.

Frost, however, said he didn’t think the report had an impact on Thursday’s decision.

“The decision is about the other five racetracks wanting to maintain their monopoly on racing in New Mexico,” he said. “They don’t want a sixth license.

“They have won this battle, but I assure you they haven’t won the war.”

Frost said the commission’s action also proved unpopular with the other parties vying for the license.

“I’ve talked to some of those people with the Clovis applicants, and they’re just as upset and flabbergasted by the whole thing,” he said.

Awarding a sixth license had proven a hard sell with the previous racing commission. Former commission Chairman Ray Willis, in a phone interview with the Quay County Sun after Lujan Grisham fired him and the rest of the commissioners in April, said he’d cast the tiebreaking vote to allow the sixth-license process to proceed.

The decision Thursday followed months of lawsuits, allegations of flawed studies, accusations of conflict of interest, the governor’s firing of the entire commission in April and the dismissal of another commissioner just a few weeks ago.

Though the Tucumcari racetrack was projected to have lower revenue than three applicants, the ownership group argued its site would be far enough from existing racinos in Hobbs and Ruidoso to cause a minimal effect from the additional competition.

Tucumcari boosters also pointed to near-unanimous support for the proposed racino, including more than 1,100 people who attended the commission’s hearing in October at the Tucumcari Convention Center. Crowds during commission hearings at Clovis and Lordsburg were smaller or more divided.

The awarding of a sixth license began to go off the rails in late November when, just days before the license would have been awarded, partners for the Lordsburg application filed a request for an injunction. The lawsuit stated a feasibility study by an independent New Orleans gaming consultant was flawed and that Willis had a conflict of interest with one of the Clovis applicants.

The license was put on hold while the injunction winded its way through the court system. A proposed settlement with the Lordsburg group led to objections from the other four applicants, saying they had no input into the deal. In the meantime, applicants expressed their growing dissatisfaction with the commission.

Lujan Grisham fired the commission in April and appointed new commissioners. The new commission abruptly canceled several meetings scheduled in June “until further notice,” then went nearly all of July with no meetings before holding a race-dates committee session Wednesday.

Lujan Grisham fired commissioner Freda McSwane last week after she refused a request to resign. The AP had acquired documents that indicated the state’s attorneys were concerned with comments McSwane made during the commission’s May meeting about changes in the way racehorses were being tested for certain medications. Ken Corazza, who had served on the previous commission, took McSwane’s place after her dismissal.

Todd Duplantis, a city commissioner who owns two restaurants on Route 66 about a mile west of the proposed racino site, said he wasn’t surprised by the commission’s action.

“When the lawsuit was filed, the commission being dismissed and another being appointed by the new governor, I had a feeling this was going to be the end result,” he said. “I do concur with Warren Frost, however, I don’t believe this is over. When the license comes back up for review, I’ll support it again.”