Hollywood Park Race Track is within a nose of winning its fight to open a card club, following the passage this week of state legislation designed to allow the Inglewood track to obtain a California gaming license.
The Assembly’s approval Tuesday of the bill, which needs Gov. Pete Wilson’s signature to become law, sent Hollywood Park stock, as well as the spirits of local officials, soaring.
“We are elated by the action taken in Sacramento,” Inglewood Mayor Edward Vincent said in a statement issued Wednesday. “This will clearly be an advantage not only to the people of Inglewood but the entire Southern California area.”
On the stock market, Hollywood Park’s shares jumped from $25.25 a share on Monday to $31.75 at closing Wednesday.
Inglewood, which is cash-starved and plagued with recession woes, stands to make money too, reaping as much as $10 million a year in tax revenues once the club is operating. The city managed to stay solvent this year only after laying off employees and figuring more than $4 million in anticipated card club tax revenues into its budget calculations. Last year, it had to borrow money using future card club revenues as collateral.
“Obviously, we’re very pleased because this makes it a lot neater and simpler for Hollywood Park to get the license quickly,” Assistant City Manager Norman D. Cravens said of the Assembly action.
The legislation, authored by Assemblyman Curtis R. Tucker Jr. (D-Inglewood), allows a publicly owned corporation that runs a horse racing track located in Los Angeles County to obtain a card club license. Further targeting Inglewood (without actually saying so), Tucker’s bill affects cities only in which voters approved a card club referendum before Jan. 1. The only city to fit all those conditions is Inglewood, where voters approved the club last November.
Current law governing card clubs does not allow publicly traded corporations such as Hollywood Park to apply for gaming licenses. The rationale behind the law is that in order to keep criminal elements out of the gambling business it is critical that the attorney general know and investigate everyone with an interest in a club. That is impossible if there are thousands of stockholders.
Hollywood Park argued that it has been in the gaming business for years with horse racing and has always passed state scrutiny for that license.
With a victory at the legislative level, attention now turns to the governor’s office, where Wilson has become the focus of strong lobbying.
In an Aug. 19 letter to the governor, Mayor Vincent said the club would “create approximately 2,000 new jobs in the city of Inglewood--jobs which will be filled in large measure by residents of Inglewood and South-Central Los Angeles. I know I do not have to tell you how important that is to our economically depressed community.”
Hollywood Park’s executive vice president and chief financial officer, Michael G. Finnigan, said officials there were “cautiously optimistic” that Wilson will sign the bill. Finnigan said the club is slated to open in January.
Some state officials say the ultimate fate of the Hollywood Park legislation may be tied to the fortunes of another bill, also sponsored by Tucker but not yet approved by the Legislature, that would significantly beef up Atty. Gen. Dan Lungren’s gaming division.
Lungren has publicly told the lawmakers that he will not support any expansion of gambling activity in the state unless they appropriate more resources to his office so he can adequately investigate and police the clubs.
Dave Puglia, Lungren’s press secretary, said Wednesday that Lungren plans to advise Wilson not to sign the Hollywood Park bill. “We are opposed unless the state establishes a comprehensive gaming control and regulatory scheme as proposed by the attorney general,” Puglia said.
Tucker, however, said his two bills are not “joined at the hip.” He says he believes the governor will sign the Hollywood Park bill, even if it is the only one on his desk.
J.P. Tremblay, a spokesman in the governor’s press office, said the governor supports the concept of beefing up the attorney general’s staff if gaming is to be expanded in California. Tremblay also said, however, that Wilson has not made up his mind on the Hollywood Park bill.