Horse Racing May Impact California Sports Betting

Yet another race track in California is about to close. And while its shuddering doesn't spell particularly good news for the horse racing circuit, the gradual decline of one industry could be a boon for another. In this case, that "other" industry is California sports betting.

Golden Gate Fields, a horse track located right between Albany, California and Berkeley, California, will reportedly close its doors for good sometime later this year. The news comes as both an emotional and industrial blow for local communities. Golden Gate Fields opened up all the way back in 1941, so it has been a Northern California staple for nearly 75 years. Closing up shop will also mean everyone from trainers and jockeys to complex staffers and event employees will be out of a job.

The Stronarch Group, which refers to itself as an "entertainment and real estate company" with a focus in Thoroughbred horse racing and pari-mutuel wagering, made the decision to shudder Golden Gate Fields, which they purchased back in 2011. They are the second owners to shut down a major horse racing track in Northern California over the past two decades. The Bay Meadows track, which opened in 1934, ceased operations in 2008, at which time it was turned over to developers.

For their part, The Stronarch Group has said this move is not a de-emphasis on the horse racing industry. They apparently just want to centralize their operations. They plan on spending $31 million to move their Northern California business into their existing Southern California roots, according to The Paulick Report, which covers all things horse racing.

However, it's tough to see this decision as anything other than an indictment on the state of horse racing. And it begets another question: Will the future of horse racing have any impact on sports betting in California? Or are the two matters simply unrelated?

Owners Claim Golden Gate Fields Closure is Not a Reflection of Their Commitment to Horse Racing in California

Measuring the potential impact another track closure has on California sports betting first requires the horse racing industry to be on the decline. The Stronarch Group has staunchly pushed back this notion. They argue that Golden Gate Fields' closure is the beginning or continuation of their commitment to the sport, not a harbinger of its end. Here's more from a piece published by Beth Harris of KTVU, a FOX affiliate in the San Francisco Bay Area:

"After the Golden Gate Fields meet ends, The Stronach Group said it will focus on moving horses from the Bay Area to Arcadia, with a goal of increasing field sizes and adding a fourth day of racing to the weekly schedule at Santa Anita beginning in January. 'The Stronach Group remains steadfastly committed to racing in California," company CEO and president Belinda Stronach said in a statement. Focusing on Santa Anita Park and San Luis Rey Downs as state-of-the-art racing and training facilities that offer enhanced program quality, increased race days, expanded wagering opportunities, and premier hospitality and entertainment experiences is vital to ensuring that California racing can continue to compete and thrive on a national level.'"

While The Stronarch Group may intend to use this track's closure as a springboard into better opportunities throughout Southern California, the very idea flies in the face of reality. Point blank: The popularity and viability of racing in the United States is on the decline. Race tracks around the country are grappling with "dwindling attendance, declining viewership, and decreasing betting revenue," according to a March report from The Plaid Horse.

This probably won't surprise anyone who has been paying attention. Concern for the treatment of horses has mushroomed over the past few decades as people become more in tune with and focused on animal rights. What's more, horse racing was always touted as a legal alternative to sports betting, which at one time wasn't widely available.

That's all changed now. More than 30 states now have some form of legal sports betting, affording gamblers access to wagering on more popular events like football, basketball, baseball, hockey, golf, tennis, etc. The rise of the best online sportsbooks in the USA has further contributed to the demise of brick-and-mortar operations. We're not just talking about horse racing, either. Bingo halls, card rooms and even many casinos have struggled to keep up with the ascent of online sports betting in the United States.

The Decline of Horse Racing Could Fuel Another Bid for the Legalization of California Sports Betting

Theoretically, even less access to horse racing could lead to a California sports betting renaissance.

This issue has become incredibly divisive after may expected it to be legalized last year. In the end, though, voters rejected two separate proposals—one backed by tribal operators (Prop 26) and one bankrolled by the best online sportsbooks in the United States (Prop 27).

To be sure, this division still exists in ample supply. Polls show Californians were disenchanted by warring proposals and their counter-campaigning. The influence of tribes is still expected to define the future of California sports betting more than any other factor. The latter doesn't necessarily spell good news for online operators. California tribes don't want them to have independent sports betting licenses. They only want online operators supporting tribal-owned mobile sites while receiving a cut of the revenue.

The decline of California horse racing is unlikely to soften this clashing dynamic between tribes and online operators. However, the support for in-person betting could trend upward.

State officials already threw their support behind on-site wagering over online gambling. If they do that again in time for the 2024 elections, the response from a voting population that continues to see their list of gambling alternatives winnow down could be dramatically different than it was in 2022.

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