Michigan’s only horseracing track is now approved to offer online race wagering, although it will have to wait until racing resumes post-pandemic.
On Tuesday, Richard Kalm, executive director of the Michigan Gaming Control Board (MGCB), issued an executive order laying out the rules for the Northville Downs racetrack to launch advance deposit wagering (ADW) through a third-party facilitator (TPF).
Last December, Michigan amended its 1995 racing laws to permit ADW on both live and simulcast pari-mutuel wagering. At present, racing wagers can only be placed at Northville, the state’s only racetrack following the closure of Hazel Park, whether one wishes to wager on a local race or the Kentucky Derby.
As a result, any kind of race wagering is currently impossible in Michigan because Northville has yet to open for its 2020 racing season. The track, like all of Michigan’s non-essential businesses, was ordered closed by Gov. Gretchen Whitmer in March. That order was extended last week through May 28 after a surge in the state’s number of new coronavirus infections.
The race-betting TPF(s) will need to work out a deal not only with the track but also come to terms on a money-splitting arrangement with the state’s two horsemen’s associations. The MGCB is clearly itching to get this underway, as the TPF license application fee is a mere $1,000 with a $500 renewal.
MGCB director Kalm said the ADW authorization “should enable the state’s horseracing industry to gain new followers.” Official figures for 2019 show the state’s race wagering handle totaled $62.7m, down from $69.6m in 2018. All but $2.1m of 2019’s total came from simulcast wagering.
There’s clearly money to be made in online race betting, as US industry leaders Churchill Downs Inc recently reported its ADW site TwinSpires generated revenue of $66.6m in Q1 versus just $1.9m from the company’s flagship racetrack in Kentucky.
Michigan’s casinos are eagerly anticipating the state’s approval of digital sports betting regulations, which, if they’d been formalized prior to the pandemic shutdown, might have somewhat blunted the impact of the total loss of land-based gaming revenue.