In the Spring of 1997, thoroughbred horse racing fans (and sports fans in general) were treated to one of the most exciting Triple Crown series in years, as the three races were decided by a combined total of about a length and the participants, Silver Charm, Captain Bodgit, Free House and Touch Gold, developed the type of rivalries on which any sport thrives. The series culminated on June 7, when close to 80,000 people packed New York's Belmont Park racetrack, the third largest crowd in the track's history, in anticipation of Silver Charm winning the Belmont Stakes and becoming the first Triple Crown winner since Affirmed in 1978. When Touch Gold got up in the final strides to win, the crowd let out a collective groan of disappointment.

Unfortunately, in recent years, racing has been subject to far more collective grumbling of disappointment about the decline of the sport of kings than packed grandstands excitedly viewing these spectacular equine athletes. Racing, once the only legal gambling in many venues and a vital industry in many states (for example, in California, racing provides more than 50,000 jobs and contributes $3 billion to the state's economy -- nearly three times that of any other professional sport), has increasingly declined as lotteries and casino gambling have taken its place over the past two decades. Moreover, not only does racing have to battle those competitors, but is also subject to intense regulation and taxation spawned from those earlier eras when racing was the only legal gaming in town and gambling was not as accepted by state governments. The repeated calls to state governments to lower pari-mutuel taxes -- the "take out" -- so that more of the pari-mutuel pool is returned to the bettors, only create the legislative dilemma of how to replace the revenue (although California did so in 1996, lowering horse racing taxes by $10 million).

And so, racing's fans, the horseplayers, have become an older and diminishing group and, correspondingly, handle has stagnated or decreased and thus purses have not grown, and the quality of racing has declined as half-filled fields of poorly talented horses make their way to the post. Honestly, who wants to see that ten or eleven times a day, when there are so many other sporting or gaming opportunities in which to partake?

Racing's solution over the past decade or so, has been to supplement its live cards with simulcasts and wagering on races from other tracks. Now, for example, New York horseplayers not only can bet on live races at Belmont, Saratoga or Aqueduct, but also might have races to bet on from Churchill Downs in Kentucky, Monmouth Park in New Jersey, Gulfstream Park in Florida, Oaklawn Park in Arkansas, and Hollywood Park in California and, similarly, New York's races are simulcast to other tracks. The Meadowlands in New Jersey even stays open until the wee hours on some nights to show live races from Hong Kong. (Simulcasting is subject to the Interstate Horseracing Act of 1978, 15 U.S.C. Sec. 3001, et seq.) New York now even provides cablecasts of the races and telephone wagering accounts to allow horseplayers to bet from home.

Another measure to reverse racing's decline has been to install slot machines at some tracks, such as those in Delaware and Iowa, and California's Hollywood Park has supplemented its racing operations with a card room casino on its premises, in the hope that some of the card players will wander over to the pari-mutuel windows. Indeed, this is all a far cry from years past where pay phones were prohibited from racetracks, to prevent bettors from calling their bookies. Yet, while simulcasting, slots and telephone betting have helped the racing industry, these measures have not completely reversed the trend. (Although such operations currently exist, there is a question as to whether out-of-state telephone betting on horse races is legal under federal law, 18 U.S.C. Sec. 1081-84, but at present, there has been no move to stop such activity.)

The next step, and a necessary one for the horse racing industry, is to put the races and allow wagering on the Internet (although some will argue, admittedly with a degree of persuasiveness, that while increasing handle and purses, racing on the Internet will all but destroy the live gate and render a day at the races, to see a Silver Charm, a thing of the past). One of New York's off-track betting corporations has already started to operate an Internet site, as have at least two other operators in other parts of the country.

Taken to its fullest extent, the Internet could link horseplayers with tracks all over the world, with a fan whose home track is Woodbine in Toronto, making wagers on races from San Siro in Italy (indeed, one of Capital Region OTB's Internet customers is from Dubai). As discussed below, the Internet and thoroughbred horse racing are a perfect fit that would no doubt favor racing's revival.

The problem is that the emergence within the past year or so of virtual casinos and other gambling opportunities on the Internet has set off storms of opposition that might prevent Internet wagering on horse racing from going forward. In fact, for instance, there is a slew of pending legislation in New York to address operating gambling sites on the Internet and bring such operations within state regulation. Among these proposed bills is one to prohibit racing associations from operating Internet wagering sites.

In general, with the proliferation in recent years of Indian casinos and the continued strength of state-run lotteries, it is more than apparent that we in the U.S.A. are a nation of gamblers, which naturally begs the question as to whether gambling should be further legalized. Indeed, any attempt to ban all gaming seems impractical to enforce. A National Gambling Impact Study Commission has been convened. Among the issues it faces is whether to permit gaming on the Internet.

Currently, there are at least 30 virtual casinos online and that number is expected to double within the next year. The initial reaction to them, however, appears to be that governments should prohibit Internet gaming. Senator Jon Kyl of Arizona has introduced an Internet Gambling Prohibition Act, which would expressly extend current federal prohibitions against interstate wagering over the "wires" to the Internet (it is unclear what application this has to racing; as noted above, federal law specifically permits interstate simulcasting and the prohibitions against interstate wagering have not been enforced with respect to interstate telephone betting operated by state racing associations).

Other examples of the opposition to Internet gaming are a suit brought by 35 state attorneys general against Executone, which operates a gaming site for the Coeur d'Alene Tribe, and Missouri's Attorney General has twice sued Internet gambling operations for doing business in Missouri and is investigating a New Mexico tribe regarding its "UPICKEM" site. Among the arguments from gambling opponents is that permitting gaming on the Internet will make gambling too accessible and promote compulsive gambling, and also allow children to get involved in gambling.

So, where does this leave horse racing? Pari-mutuel betting on racing at recognized tracks materially differs from gambling on virtual roulette, virtual card games, virtual keno and the like, the "odds" in all of which can be easily be manipulated by an unscrupulous virtual casino's operator. Because of these differences, and the long-standing interest in horse racing, many believe that development of racing coverage and wagering should and will expand on the Internet, rather than be curtailed as part of the indictment of virtual casinos.

The benefits to the racing industry of providing racing and pari-mutuel betting on the Internet are clear -- larger handles and more, and likely younger, fans. Larger handles mean larger purses and better racing, and should allow states to lower pari-mutuel taxes without reducing revenues. This again benefits the horseplayers by returning a larger portion of the pari-mutuel pools to the bettors, and thus makes racing a more attractive wagering opportunity, permitting racing to recapture some of the gambling market it has lost to casinos and lotteries. As the fan base increases, particularly among younger people, it can be anticipated that the new generation will attend live racing.

The dangers of Internet casino-style gaming simply do not seem to apply to horse racing. Since the kind of wagering on horse racing addressed above is conducted through the use of pari-mutuel pools, the risk of an unscrupulous Internet gaming operator rigging its games with odds completely in the house's favor does not exist. Likewise, horse racing is already heavily regulated at the track, with its participants and every race being subject to the strict scrutiny of the racing stewards. Given the alternative of having cyber-horseplayers turn to illicit and off-shore Internet bookies, the state-regulated racing operators should be the ones primarily offering wagering on the Internet and racing fans should be expected to welcome the existence of pari-mutuel pools in which they can have confidence that the odds are not being artificially manipulated.

Furthermore, wagering on racing is entirely unlike playing a Keno game or an instant lottery, which when done on the Internet is likely to become like merely playing a video game until of course the bill comes. Those virtual games deal with chance and the perception that the odds have not being artificially changed. Wagering on horse racing requires handicapping, not just chance or the semblance of chance. Handicapping also seems yet another reason for the Internet to be a perfect fit with racing, as the cyber-horseplayers sitting at their terminals, while accessing the races, could pull down the Daily Racing Form, or their own charts, trip notes and programs for their "systems," into another desktop window

For many reasons, racing and the Internet seem to be perfect fit, a progressive and economically needed measure to ensure quality racing in years to come. Contrary to the old warning, horse racing and the Internet properly places the cart with the horse. Since existing law on simulcasting envisions interstate pari-mutuel wagering on horse racing, and since horse racing at established venues does not carry the risk of possible fraudulent odds making that casts a shadow over virtual casinos, it may be that governments will decide not to direct their limited enforcement resources so as to try to preclude pari-mutuel wagering on horse racing, even if efforts are made to curtail virtual games of chance.