Prop 1 foes, supporters try to make their case

SANDPOINT — Proponents and opponents of Proposition 1 are now in a race against time to make their case to Idaho residents as historical horse racing heads to voters next month.

The two groups are in opposition as one seeks to legalize HHR gaming terminals, while the other claims it would allow the unlimited expansion of gambling machines in Idaho.

"The problem that we have with the proposition is that it is misleading to the people," said Ken Andrus, chairman of Idaho United Against Prop 1, who stopped by the Daily Bee recently as he criss-crossed the state campaigning against the ballot measure. "... The proponents of the proposition are touting this as an education measure, a jobs measure and to restore horse racing."

Andrus disputed these claims and said Proposition 1 is simply about expanding gambling in the state in an unconstitutional manner. On the proponent side, Todd Dvorak, spokesperson for Save Idaho Horse Racing, said it is about reviving the state's horse racing industry and bolstering the state economy. 

Proposition 1 asks voters to legalize a "limited, restricted and transparent form of gaming," Dvorak said. If passed, the terminals would be allowed at "any facility located with the grounds or enclosure where live and/or simulcast horse racing is conducted and where at least eight live horse race days are conducted annually." Andrus said the way the measure is written, Idaho could be "proliferated" with the machines.

HHR terminals were legalized in 2013 by the Legislature, though it was repealed in 2015. Andrus, who was in the Legislature at the time, said lawmakers saw that the HHR terminals resembled casino-type slot machines and violated the Idaho Constitution. Dvorak said the terminals were generating revenue that helped bolster the live horse racing industry. Les Bois Park in Boise closed indefinitely after the 2015 season, and there have been fewer races at some of the smaller tracks, Dvorak said. The machines were previously located at Les Bois Park, as well as Sandy Downs in Idaho Falls and Greyhound Park in Post Falls.

Betting on live racing has declined over time, Dvorak said, and Idaho is not unique when it comes to the struggle of horse racing.

"The wagering was helping to support the industry," Dvorak said. "You had tracks that were taking revenue from the betting, putting it back into operations at the track, making the track look great, upkeep, drawing fans with competitive racing and healthy purses. Over time ... Americans who enjoy betting have found other places to put their money."

Opponents of Proposition 1 maintain that the terminals are, or at least resemble, slot machines found in casinos. They have reels that spin as bets are placed by pushing a button repeatedly, with winning or losing bets indicated by pattern of images across the screen. There is a smaller screen that shows a short clip of the horses crossing the finish line of a historical race. They "look like slot machines, act like slot machines and people use them like casino slot machines," Andrus said.

Proponents of Proposition 1 note that slot machines determine a winner based on random number generation, an algorithm that could be adjusted, and determines winners or losers based on chance. An HHR terminal is connected to a network that pools all of the bets placed, and winners and losers are determined on a pari-mutuel system and how the person placed their bet — if they pick the right horse, for example, Dvorak said.  

Pari-mutuel betting requires the majority of the wagers placed be returned to the bettors, Dvorak said. Proposition 1 ballot language states that 90 percent of the bets be returned to the bettors. It also requires 1 percent to go to the Idaho Racing Commission. The commission will then distribute one-half of the 1 percent to public schools, one-fourth to the racing commission, one-tenth to the track distribution account, one-tenth to Idaho thoroughbred and quarter horse breeders, and one-twentieth to Idaho Horse Council youth programs. The remaining 9 percent would go the owners of the terminals.

"So yes, all of those groups will get a little bit, but it's pittance compared to the profit the owners are making," Andrus said. 

Dvorak said prior to the 2015 repeal, $600,000 was raised for public schools that year by HHR terminals.

"When we say in our campaign message to voters that this means millions for public schools, we are talking about over an accumulation of years this would mean millions of dollars going to public schools if Proposition 1 passes," Dvorak said.

Andrus said HHR terminals violate the Idaho Constitution, which states that gambling is "strictly prohibited," with the exception of state lottery, bingo and raffle games and pari-mutuel betting. While pari-mutuel betting is listed under the exceptions in the first subsection of Article III, Section 20, Andrus said the terminals are still in violation as they fall under the next subsection of the Idaho Constitution that states, "No activities permitted by subsection 1 shall employ any form of casino gambling, including but not limited to, blackjack, craps ... slot machines, or employ any electronic or electromechanical imitation or simulation of any form of casino gambling."

If the initiative passes on Nov. 6, Andrus said it will be appealed to the Idaho Supreme Court.

Mary Malone can be reached by email at mmalone@bonnercountydailybee.com and follow her on Twitter @MaryDailyBee.