Study: Oaklawn, Southland Racetracks' Impact on Arkansas Economy Near $900 Million

by Luke Jones  on Monday, Jun. 2, 2014 12:00 am  

Arkansas’ two racing and gambling venues, Oaklawn Park in Hot Springs and Southland Park in West Memphis, contributed almost $900 million to the state’s economy in 2012, or so a new study concludes.

The study, prepared by BaxStarr Consulting Group LLC of Chicago for official release this week, was commissioned because the venues believed their importance to the state’s economy hadn’t been adequately measured.

“We saw a lot of tourism statistics and stuff being issued from associations like the Arkansas Hospitality Association, Parks & Tourism, etc., and gaming was never mentioned from an economic-impact perspective,” said Troy Keeping, president and general manager of Southland. “We approached them and said we needed some type of independent data.”

Keeping said he wanted the state’s politicians and leaders to understand the venues’ economic impact “because it’s significant.”

“Oaklawn has fortunately been a pretty significant economic catalyst for a great many years,” said Eric Jackson, Oaklawn’s general manager. “Certainly it’s been a terrific tourism catalyst here in Garland County. That hasn’t changed much. We’re growing, fortunately. We’ve always been a major racing center, and now we’re developing some gaming business, too.”

Keeping said the findings validate some of the reasoning behind voting in favor of allowing the venues to have electronic games of skill, an addition that came in 2006.

The study measured economic impacts linked to racing and gambling ($703 million), taxes paid ($42.5 million), tourism ($120 million) and short-term construction ($30 million) for a total of $895.5 million.

BaxStarr measured direct impacts such as ticket sales, but it also measured indirect impacts such as purchases by the venues from other businesses, induced impacts made up of income spent by venue employees, as well as the venues’ support of secondary businesses such as the kennels at Southland and trainers for both horse and dog racing.

Broken down, Oaklawn had revenue of $88.6 million in 2012 and the study added $52.3 million of indirect and $78.9 million of induced impact. Southland had revenue of $162.7 million, $93.3 million of indirect and $144.8 million of induced impact, all for a total of $620.6 million between both venues.

The study added in money paid by Oaklawn for horse training and breeding ($66.3 million) and money paid by Southland for dog breeding and kennel operations ($16 million) for its total of $703 million. It then added in taxes, tourism and short-term construction numbers for the $895.5 million total.

BaxStarr also looked at employee impact, which it reported separately as a $74.3 million impact. For example, Southland in 2012 had 371 full-time hourly employees, 216 part-time hourly employees and 51 full-time, salaried positions with a total payroll of about $13.9 million. Oaklawn’s employment ranged from 400 to 1,500 depending on the time of year, and it had a payroll of $13.6 million in 2012.

“The wages of the employees at Oaklawn and Southland are spent in the economy in Arkansas on goods and services, at stores, etc.,” the report said, “and these create both indirect and induced impacts which are included in the model.”

 

 

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