Winnipeg Free Press - PRINT EDITION

Development plan for Downs unveiled

But racetrack's betting licence still in jeopardy after reprieve

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Manitoba Jockey Club CEO Darren Dunn said any money Assiniboia Downs gets from Peguis will go into horse racing.

RUTH BONNEVILLE / WINNIPEG FREE PRESS Enlarge Image

Manitoba Jockey Club CEO Darren Dunn said any money Assiniboia Downs gets from Peguis will go into horse racing. Photo Store

Assiniboia Downs won a minor victory Thursday with a reprieve to start the new year with a licence for simulcast horse-race betting.

But the war over a permanent licence to last the full year has yet to be fought.

The Manitoba Horse Racing Commission issued its reprieve to the Manitoba Jockey Club on Thursday evening.

The two are in court over a proposed joint venture with Peguis First Nation, focused on a mortgage on the Downs that puts its ownership at stake.

The commission agreed to issue a temporary race licence to expire Feb. 28, 2014.

"We've come to an accommodation that puts a mechanism in place for a temporary licence," commission chairman Tom Goodman said in an interview.

The next step is up to the courts, with a hearing date Feb. 25, Goodman said.

Peguis First Nation and the jockey club formally announced their intention Thursday to build two hotels, a conference centre and retail space at Assiniboia Downs in a deal they say would place horse racing in Manitoba on a solid footing and provide much-needed jobs and income for aboriginal people.

If the jockey club releases its joint-venture agreement with Peguis First Nation, the racing commission will review the deal and decide whether the licence should be extended.

"If it doesn't, we'll cross that bridge when we come to it," Goodman said.

The commission's misgivings focus on a 25-year, $15-million mortgage on the ownership of Assiniboia Downs. If the mortgage is used to transfer the ownership of the Downs as part of the joint-venture partnership, then the licence is at risk.

Until now, the jockey club has owned the Assiniboia Downs and adjacent land and run the racetrack since 1993.

The announcement on details of the joint venture Thursday made no difference to the position of the racing commission, Goodman said.

A statement late Thursday made it clear its influence is critical to the future of the Downs and its reprieve is a gesture of generosity.

"Construction of the proposed development at Assiniboia Downs will not commence until the matter has been resolved... a decision of the board will see simulcast betting continue for the time being," the statement said.

The commission had threatened to pull the jockey club's licence for simulcast horse racing over its business dealings with Peguis. A senior cabinet minister made it clear Thursday the province would not OK a casino at the site.

At a news conference, the jockey club and Peguis announced they are 50-50 partners in a new company, FN Developments Inc., that will develop 16.2 hectares of land at the south end of the Downs.

"The new and improved Assiniboia Downs will be a premier destination for both Manitobans and tourists and is poised to generate upwards of $100 million in infrastructure spending and jobs," Peguis Chief Glenn Hudson said.

The partners plan to announce more details of the project in spring and begin construction as early as summer. Community consultations and stakeholder meetings are planned for early in the new year.

While a casino was not included in the announcement, Hudson left no doubt he still has hopes a gaming facility can be part of a new development.

"We'll certainly have to sit down with the Province of Manitoba," he said. "Certainly there is gaming on site today. And I think in the future the potential is great."

But Finance Minister Jennifer Howard slammed the door on expanded gaming at the Downs on Thursday.

If the jockey club has found a partner that can help ensure horse racing is sustainable in the future, "that's a positive," she said. But not if it includes a casino, she added.

According to market research, the Winnipeg region is saturated with gaming options, Howard said. And government revenues from gambling are lower than expected so far this fiscal year, she noted. "So having a casino in the city, just outside the city, is not something that we're interested in."

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Several Conservative MLAs and former federal Tory cabinet minister Vic Toews were on hand for the announcement Thursday at the Downs. Toews, as the former senior federal minister for Manitoba, had a hand in settling a treaty land-entitlement claim a few years ago worth $126 million to Peguis. No provincial NDP MLAs were on hand for the event, although organizers said a number of cabinet ministers were invited.

The partners have been working on a development deal for nearly two years. Hudson said Thursday that Peguis initiated the discussions.

It was recently revealed Peguis has loaned $15 million to the jockey club. When the racing commission got wind of that, it demanded more details of the mortgage, concerned it could be used to transfer ownership of the Downs to the First Nation without the MHRC's approval.

When it didn't immediately receive a response, the commission announced Tuesday it had suspended consideration of the jockey club's 2014 race licence, threatening to halt simulcast betting at the Downs as of Jan. 1.

Darren Dunn, the jockey club's chief executive officer, called the MHRC's threat an "overreaction."

"We're surprised that we didn't have the opportunity to have a hearing about it, speak to them in person about it. We believe we were entitled to that," he said Thursday, adding any monies it receives from Peguis will "go right back into horse racing."

Dunn deflected reporters' questions on whether the MJC planned to sell the Downs to Peguis, but Hudson left no doubt the First Nation was interested.

"Certainly that's something that we have worked toward. We are looking at moving ahead (with) those discussions. Those are things that are yet to come," the chief said.

He also joked: "On First Nations land, horses run faster."

alexandra.paul@freepress.mb.ca larry.kusch@freepress.mb.ca

Republished from the Winnipeg Free Press print edition December 20, 2013 A4

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