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November 15, 2013

Presque Isle Downs sues harness commission, Endeka

NEW CASTLE — Presque Isle Downs and Casino is continuing its efforts to block Lawrence County’s proposed racetrack and casino.

This week the Erie-based racetrack and gaming facility asked Commonwealth Court to order the Pennsylvania Harness Racing Commission to “substantively review licensure matters” involving the license issued to Endeka Entertainment to establish Lawrence Downs Casino and Racing Resort.

The Erie concern operates a racetrack/casino about 75 miles from the track and casino proposed for Mahoning Township.

Presque Isle said it is taking this action “to protect its interest as a competing racino in the same market ... in the best interest of racing and the commonwealth’s interest” by opposing a harness racing license to Endeka “to develop an unsuitable and unfeasible” facility.

In July, the commission granted Philadelphia-based Endeka Entertainment and its partner, Penn National Gaming Inc., a license to build a $160 million racetrack in Lawrence County.

In September, Presque Isle challenged the racing commission’s decision.

It now claims the commission “shirked its duties” by not re-examining Endeka’s proposal, saying the application changed since it was first submitted. Presque Isle contends the application is incomplete, lacking plans for the racetrack, security and other structures.

Changes identified by Presque Isle include a $100 million drop in projected revenue, the loss of a horsemen’s association agreement and a “substantially changed competitive environment,” which includes a thoroughbred racetrack now under construction in Austintown, Ohio.

Another change not reviewed by the commission, Presque Isle claims, is the “highly questionable” decision by Lawrence County government to back the project with a $50 million bond issue to be repaid with anticipated gaming revenues.

Lawrence County commissioner chairman Dan Vogler said Presque Isle’s characterization — that public funds will be used — is misleading.

“We’re looking at a bond issue that will be repaid using funds earmarked for Lawrence County that will be provided through casino revenue,” he said, not tax money.

In October, when the commission rejected Presque Isle’s request to revoke Endeka’s license, commission solicitor Jorge Augusto said Endeka had met all licensing conditions and — more importantly — no proceeding involving Endeka was before the commission.

Presque Isle disagrees, claiming Endeka has not met conditions set by the commission — even after requesting and receiving three extensions.

It also questions the propriety of Penn National Gaming, Endeka’s partner in the local project.

In addition to signing on to operate a harness track/casino in Lawrence County, Penn National is constructing a thoroughbred racetrack in nearby Austintown, Ohio.

Noting he had not yet read the filing, Lawrence County solicitor Tom Leslie said he sees no potential conflict in Penn National’s operation of two facilities in such close proximity.

“First off, the Lawrence County location would have a casino. The Ohio track would have only a video display terminal parlor.”

“Additionally, the type of people attracted to a harness racetrack are completely different than those drawn to thoroughbred tracks. Penn National is not competing with itself with two racetracks.”

(Email: nlowry@ncnewsonline.com)

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