Agreement Lets Southland Get Slots Money While VIGL Runs St. Thomas Racetrack

A bend int eh course at the Clinton-Phipps Racetrack on St Thomas. (Source photo)
A bend in the course at the Clinton E. Phipps Racetrack on St Thomas. (Source photo)

Gov. Albert Bryan Jr. has submitted a bill to address the recent settlement of the lawsuit between the V.I. government, Southland Gaming and VIGL that was blocking the redevelopment of Clinton E. Phipps Racetrack on St. Thomas.

According to Government House, the agreement allows Southland to construct a facility in the grandstand and provide 50 slot machines, which Southland calls “Video Lottery Terminals,” and VIGL will operate the VLT facility and be the promoter of the races at the track.

Southland also agreed to commit up to $100,000 each race day, up to $600,000 annually, toward purses at the racetrack for the duration of its contract with the GVI and is extended for 13 years to match the duration of VIGL’s agreement.

According to Government House, under the settlement, the government agreed to allow VLTs instead of slot machines at the St. Thomas Racetrack facility under Lottery regulation; to remove portions of the Racino Act that would allow slot machines at the St. Thomas Racetrack, to correct the Casino Revenue Fund allocation to add up to 100 percent instead of 101 percent, and to provide for the racetrack gaming tax to go toward St. Croix purposes only.

While the V.I. government has maintained there is a distinction between slot machines and VLTs, a 2020 federal court opinion found otherwise.

The new agreement allows Southland to complete the development of the
racetrack and VIGL to manage the racetrack after construction, Bryan wrote in his transmittal letter to Senate President Donna Frett-Gregory.

“The GVI and VIGL have already agreed to remove the development of the Clinton E. Phipps racetrack facility from the VIGL’s Franchise Agreement, and that responsibility is shifting to Southland,” Bryan wrote. “Once the amendments to the Virgin Islands Code have been approved and the Southland agreements have been approved and ratified, the amendment to the VIGL Franchise Agreement will then be finalized.”

According to Bryan’s transmittal letter, VIGL and the GVI already have amended the Franchise Agreement to separate obligations related to the St. Thomas racetrack and the St. Croix racetrack in order to begin renovations at the St. Croix facility. Once the Southland agreements are approved by the Legislature, VIGL and the government will change the franchise agreement to remove the development of the St Thomas track as needed, according to Government House.

The agreements and legislation may end a dispute between Southland, the V.I. government and St. Croix slot machine operator VIGL over rights to slot machines on St. Croix and the running of the territory’s two horse tracks. In 2016, VIGL entered into an agreement to renovate and operate both tracks and provide for race purses, in exchange for operating slot machine parlors at both tracks.

Southland objected and filed suit, arguing it had an exclusive contract for slot machines on St. Thomas. The dispute is one of several factors that have delayed work to renovate both horse tracks. It reached an agreement with the government