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Owners of the Horseshoe Casino have been given approval to add off-track-betting to the facility, and they’re having a soft launch Saturday. (The Daily Record / Maximilian Franz)

Off-track betting coming to Horseshoe Casino

Horse racing enthusiasts will soon be able to place bets on races from around the country under an agreement between the Maryland Jockey Club and the Horseshoe Casino in Baltimore.

Preparations are underway to have a soft open as early as Saturday for what will be only the second traditional off-track betting facility currently in Maryland and the only one at one of the state’s five casinos.

Dave Scheing, vice president of pari-mutuel operations with the Maryland Jockey Club, said there are plans to open additional sites across the state.

“This could very well be the biggest OTB in the state,” Scheing said. “It has that potential.”

The jockey club will place five automated teller machines and about 33 cubicles in a nearly 1,600 square-foot  space near the bar and food court at Horseshoe Casino. Wagers can also be made on tablets in the facility as well as via a mobile application for personal smart phones and tablets.

Scheing declined to speak about the specifics of the financial arrangement between the casino and the jockey club related to the use of the space.

A representative of the Horseshoe Casino did not respond to a request for an interview.

The plan is have an official opening in time for the Kentucky Derby on May 2, Scheing said.

The license, approved by the Maryland Racing Commission on Tuesday, is good until the end of the year.

The jockey club projects the facility at Horseshoe Casino could handle as much as $10 million in wagers in a 12-month period, or roughly $6.8 million for the seven months of operation covered by the current license.

“You’ve got a captive audience,” said J. Michael Hopkins, executive director of the Maryland Racing Commission. “Handling $800,000 per month is not that unusual.”

But Horseshoe Casino, which opened last August, has yet to meet its own projections for revenue. Mayor Stephanie Rawlings-Blake announced earlier this month that she will not implement the next phase of her property tax reduction plan after the city downgraded revenue estimates from the casino from $14 million to $8.3 million.

Doug Reed, director of the University of Arizona Race Track Industry Program, said opening such a facility in a stand-alone casino outside of Las Vegas or Atlantic City “is a pretty novel idea.”

Reed said the concept of combining off-track betting with slots and table gaming would offer a wider variety of options to gamblers.

“It’s really not a bad idea,” Reed said.

But off-track betting is not a sure thing. Parlors have all but disappeared in Maryland.

At the height of the industry, the state had as many as five facilities.

Off-track betting facilities in Maryland have been weakened by a number of trends — the decline of racing in general; the advent of online gaming, including the ability to place bets on races over the Internet; the opening of casinos on Maryland’s borders as well as the five within the state; and the general availability of other competitors for the entertainment dollar.

Adding to those complications was the fact that many of the sites in Maryland were associated with restaurants, Hopkins said.

“It wasn’t very cost effective,” Hopkins said. “Combined with the upkeep of a restaurant, it’s a very fine bottom line.”

In 2004, off-track betting facilities reported nearly $67.4 million in total wagers. More than 60 percent of the wagering came from The Cracked Claw Restaurant. The restaurant, which opened the state’s first off- track betting facility in 1993, closed in 2011.

By 2009, the total amount of wagers at off track dropped to about $41.4 million.

As of 2013, the last period for which figures are available, two facilities — the Riverboat and the now defunct Northeast Racing and Sports Club — took in $10.2 million.

“This is a much more urban environment than either of those two,” Scheing said of the Horseshoe facility. He said the jockey club projection of $10 million in wagers annually at Horseshoe “is a low-ball estimate.”

Currently, there is only one traditional off-track betting facility licensed by Maryland — The Riverboat on the Potomac, which technically operates out of Virginia.

Pimlico Race Course holds an off-track betting license that allows it to carry simulcast racing even though it does not hold races on the full number of days it is allowed by law. The wagers associated with the off-track betting at Pimlico are not counted as part of the off-track betting figures in the racing commission’s annual report.

Despite that decline, Scheing said he believes the opening of a facility at Horseshoe Casino could revive parlors across the state.

“That’s what we’re trying to redevelop,” Scheing said. “We’re looking at new ways to do this, to roll it back out.”

Scheing said the company is looking at four other sites, including somewhere in Frederick County near the site of the now-defunct Cracked Claw restaurant and its off-track betting facility.

It is not clear how the ability to bet on races at the casino will affect the handle at Pimlico.

“That’s the $64,000 question,” Scheing said.