Battles linger down the stretch

For three years, the gallop toward a five-eighths of a mile harness-racing track in Anoka County seemed like a marathon, a long shot at best.

After several false starts, the $61 million Running Aces track in Columbus is scheduled to open in April. But the legal hurdles, protests, financial concerns and land issues that delayed the opening have given way to new controversies -- over simulcasting races, the immediate opening of a card room and the termination of a deal expected to cost the track's local owner nearly $30 million.

There are no sounds of hooves yet thundering against the turf on the 165-acre Running Aces site. But the work in progress includes state-of-the-art barns with 300 stalls that bring a 21st century marriage of wood and steel to the Sport of Kings. There is a framework for stands surrounding the oval track, a card room, a concessions area, a picnic area, rows of tall lights, new trees about to be planted, 1,544 parking spots and space for 100 buses. And there is the promise of 600 new jobs.

"My goodness, it's impressive," Anoka County Commissioner Scott LeDoux said after a recent tour of the track.

But for Southwest Casino and Hotel Corp., the track's Bloomington-based co-owner, the race to the winner's circle has become muddied with obstacles.

No thoroughbred simulcasts

Of immediate concern for Southwest Casino and its West Virginia-based partner, MTR Gaming Group, is a state law that permits a track to simulcast only the breeds that race live at the track. The Anoka County track will hold 50-day meets with eight races attended by a couple thousand people each day.

But the inability to simulcast thoroughbred races could cost Running Aces tens of millions of dollars in bets each year.

"This shouldn't be a very controversial bill, but there is this attitude at the Legislature that there should be no modifications to how the gaming rules are set up now," Thomas Fox, chief financial officer and president of Southwest Casino, said last week. "Since Canterbury Park agrees with us, it shouldn't be an issue."

Running Aces already has the right to simulcast harness races, but the big money comes from simulcasting thoroughbreds. Two years ago, a total of $59 million was bet on simulcast races at Canterbury Park in Shakopee, said Canterbury owner Randy Sampson. Of that, slightly less than $3 million, or about 5 percent, was bet on simulcast harness races, Sampson said.

The Running Aces owners also would like to see changed a law that requires a track be open for 50 days before card playing is allowed. It's possible that the Anoka County track could open in April, but card playing might not be allowed until July.

But the legal battles Southwest Casino faces are not limited to the State Capitol.

A 13-year business relationship with the Cheyenne-Arapaho tribes in Oklahoma ended this summer when the tribes decided to no longer pay Southwest Casino an estimated $6 million per year to run two casinos. Not only did the tribes' decision cost Southwest a potential $30 million over five years, but it also sent ripples through the tribes' divided hierarchy that can be felt all the way to federal court.

Caught on YouTube

Robert Lyttle, attorney for tribal Gov. Darrell Flyingman, said that Southwest reneged on promises to build the tribes a hotel, health clinic, amphitheater and gas station. Jeffrey Halpern, a Southwest Casino partner, said last week that all would have been built had Southwest been given the luxury of a long-term contract.

Flyingman's opposition to Southwest Casino resulted in a tribal rift that twice led to his recall in recent months -- only for both to be overturned by tribal court because of violations in election proceedings.

But when a casino's surveillance camera caught tribal members receiving payments from Southwest Casino, the video landed on YouTube.com in July -- and in federal court in Oklahoma City.

The video, carrying the title "Buying Legislators," resulted in a $16 million lawsuit by Southwest against Flyingman and other tribal members. The video was removed from YouTube.com days later -- but not before the distribution of a DVD with the title, "Southwest Casino: Where's My Check?"

Halpern said that the payments were reimbursements, some for travel. Flyingman didn't return calls from the Star Tribune. But in a letter to Flyingman dated April 30, Southwest Casino CEO James Druck wrote that Southwest hosted and paid for tribal community meetings and provided tribal members with transportation. Those trips included transporting elders to Southwest's casinos in Cripple Creek, Colo., Druck wrote.

With a recently signed consulting agreement in the Dominican Republic and with solid ownership of two casinos in Cripple Creek, Fox said Southwest Casino remains solid financially.

The Anoka County track owners previously faced an anti-gambling group in Columbus that sued the Minnesota Racing Commission, alleging it violated state open meeting laws in licensing the new track. The Army Corps of Engineers, concerned about preserving artifacts from an early Indian village at the site, delayed granting approval for a groundbreaking that postponed the track's opening for nearly a year.

The commission was cleared by the courts, and the Corps of Engineers allowed Kraus-Anderson to begin construction. Now, with the track due to pay $227,000 in real estate taxes and an additional $88,000 to the city, many in Columbus have embraced the track.

"Anyone who still thinks the track is controversial should stop by and see it," said Columbus Mayor Mel Mettler. "It's first-rate. There is nothing low-rent about it."

Added LeDoux, the one-time heavyweight boxing title contender: "I love the thoroughbreds, but buggy racing is such a romantic thing to watch. Have you ever seen 'April Love,' the Pat Boone movie? It's one of my favorites. Harness racing is just beautiful."

Paul Levy • 612-673-4419

Paul Levy • plevy@startribune.com