Dec. 14, 2004 – TRAXCO, Inc. representatives told senators Tuesday at a Senate Finance Committee hearing in Frederiksted that Christmas Second Day Races will be held at the Randall "Doc" James Racetrack on St. Croix, if the Senate approves a lease and franchise agreement before it.
However, TRAXCO, a subsidiary of Treasure Bay V.I. Corp., the company that manages Divi Carina Bay, won't be running the races. The Horsemen Association Racing Protective Syndicate will. The association has run races at the track previously but ran into trouble getting insurance and had to discontinue. TRAXCO reportedly is helping with the insurance while also putting up $22,000 in prize money.
Dennis Brow, general manager of TRAXCO, said the company was willing to make that commitment, if everything goes well. If the Senate in its special session fails to approve the agreements, TRAXCO would be forced to reconsider, he said.
No senator expressed disapproval of the agreement that would give TRAXCO basic control for the next 10 years of the racetrack across the street from the Henry E. Rohlsen Airport. At the end of the hearing, Sen. Ronald Russell said, "I support this and I think all 15 senators should support it tomorrow." The committee voted unanimously to recommend the agreement to the full Senate on Wednesday.
However, senators did have concerns about the proposed deal which Ira M. Hobson, commissioner of Housing, Parks and Recreation, said resulted from eight months of back and forth between the government and TRAXCO. "This is not something we came up with in two days," he said.
Hobson received intense questioning from Sen. Celestino White Sr., who wanted to know, "What does the government get out of this."
Hobson said the property would be greatly enhanced by improvements made by TRAXCO.
In his opening remarks Brow stated that TRAXCO planned to spend a $1 million on improvements and for operations during the first year.
Physical improvements would include upgrading the track surface, paving the grandstand and entrance area, landscaping grounds and paving walkways, enclosing a simulcast area, a new camera system, construction of new restrooms and renovation of old ones, a new tote board and refurbishing jockey quarters.
Brow said the restrooms would be completed within 120 days of the agreement and all major renovations would be completed within 18 months.
All the enhancement did not appear to impress White. He said the improvements would be good for the time of the contract, the time that the track was occupied by TRAXCO.
"After the period of the contract is over, we expect to have a nice facility to lease," Hobson said.
White quoted from comments earlier in the hearing made by former Sen. Adelbert Bryan that previous tenants had actually dismantled the track, taking away a satellite dish and other items from the track.
Hobson said there were more teeth in this agreement than the previous one.
Brow said TRAXCO has given the government $10,000 cash and a $100,000 bond to insure the renovations are completed.
Russell was concerned that this "was just a way to back-door another casino" on St. Croix. He questioned the words "any game device" in the relevant documents.
Brow answered that horse racing as a stand-alone facility was "dying." He said the industry was going toward "racinos" (meaning a combination of racing and casino), and that something like that might be in the future for the St. Croix track.
Any additional gaming devices at the race track would have to be approved by the V.I. Casino Control Commission.
Todd Newman, an attorney representing TRAXCO, said, "I don't know anyone who thinks they are going to backdoor anything around Judge Petersen." Eileen Petersen, a former judge, is chair of the commission.
Sens. Louis P. Hill and Luther F. Renee had questions about TRAXCO as a company.
Newman said that TRAXCO had been founded about two years ago for the purpose of managing the racetrack and, at present, had no assets. He added that the company was in a position to borrow $1 million as soon as the agreements were signed.
When asked by Hill whether Treasure Bay would be responsible for any of TRAXCO's liabilities, Newman responded that TRAXCO was a "stand-alone" company.
White had concerns that Brow, a Crucian by birth, may be being used as a "front." He said he knew Brow and he knew his father. He asked the principals to fax him a copy of a contract for Brow that runs as long as the lease agreement runs. Several times during the hearing he gave out his fax number.
Brow said he is presently the cage manager at Divi Casino. "I watch the money," he said.
White said, "Quit watching their money. Watch your money. Get a contract."
The principals of TRAXCO are Barbara Shattles, Divi Casino general manager; Bernie Burkholder; and William Bryce. Senators said they had not received any information on Bryce and wanted it before the special session Wednesday.
The lease requires TRAXCO to pay to Housing, Parks and Recreation an annual rental fee of $48,000 the first two years. The next three years the rental fee goes to $60,000. In years six and seven the rental fee will be $72,000 and for the last three years it will be $84,000.
Sen Adlah "Foncie" Donastorg chaired the hearing. Also attending were Sens. Norman Jn Baptiste and Usie R. Richards.
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