In what could mark the beginning of a major expansion of off-track betting for the lagging horse-racing industry, Commerce Casino this week will become California’s first facility to offer remote wagering at card clubs, restaurants and bars.

A new law allows as many as 45 neighborhood locations to be added statewide, including 15 in Southern California. That’s on top of the 34 already authorized, but those are mostly at tribal casinos, seasonal fairs and race tracks. The ones at race tracks offer betting at other tracks.

“We need to expand our customer base and this is an obvious way to do it,” said John Harris, chairman of the California Horseracing Board, which licenses and oversees the wagering sites. “We should have done it 20 years ago.”

For decades the horse-racing industry has been battling declining attendance and betting revenues as gamblers have turned to alternative venues such as casinos in Las Vegas and on Indian reservations.

While the total amount wagered on California horse races about $4.4 billion in fiscal 2007-08 has shown modest gains, experts said it has not kept pace with spiraling costs. As a result, the total purse the net income to betters, winning horses and operators has remained fairly flat.

Past efforts to increase the purse by allowing race tracks to install slot machines was shot down by voters after an opposition campaign well funded by Indian casinos. However, the horse-racing industry with support from the card clubs successfully pushed for an expansion of off-track betting, which the Legislature approved in 2007.

“We don’t know if the effect will be dramatic, but even if we could expand business by just 1 to 2 percent, it would be good,” said Harris. “The idea of having betting at card clubs and other venues is the sociability. We’ll see how card players will transition to betting on horse racing.”

Months of planning

The off-track betting expansion couldn’t come at a better time for the Commerce Casino, which like the rest of the gaming industry has seen a decline in revenues as gamblers have pulled back.

The casino continues to draw 8,000 to 10,000 customers a day a number that has remained relatively stable for decades but players are spending less time at the tables, causing a roughly 10 percent decline in revenues, said Andy Schneiderman, the club’s vice president and general counsel.

“It will give us a competitive edge,” Schneiderman said of the satellite wagering. “We hope it will bring in more business but, from our perspective, it’s worth doing even just to keep existing customers happy.”

The horse-racing action is projected to generate about $35,000 a day during the week and up to $50,000 a day on weekends. The club will take 2 percent off the top with the rest going to the tracks, winning bettors and horses.

The card club has spent several months preparing for Wednesday’s opening, which coincides with the kickoff of the thoroughbred season at Del Mar Thoroughbred Club in San Diego County.

In a 2,000-square-foot space once used as a bar, workers have knocked down several walls, installed 14 pine tables with seating for about 200 and mounted 15 flat-panel TV screens on the walls for patrons to monitor horse races beamed by satellite from throughout the United States.

The Commerce Race Book, as it’s called, also will feature eight kiosk-style self-serve machines equipped to sell and cash tickets, as well as at least one live clerk to do the same.

“We’re very excited about it. Having this amenity is huge,” said John Griffo, director of marketing and advertising for the club, owned by the privately held California Commerce Club Inc.

Tom Varela, general manager of Southern California Off Track Wagering, which manages off-track betting in Southern California, said Commerce was chosen because it’s the largest card club in the county.

“We talked to a few clubs, but decided that it would be best to proceed with Commerce because it would give us the largest exposure,” said Varela, whose non-profit was formed by racing associations, fairs and wagering facilities to equitably divide expenses associated with off-track betting.

Beta test

As part of the deal, Commerce will have an exclusive contract barring satellite wagering at any of L.A. County’s seven other card clubs for at least the next six months during which the system’s “kinks” will be worked out.

“It will give us a beta test,” Varela said. “We will look at the results to find out what kind of business we attract and then decide whether, and to what extent, to open it up.”

Representatives of the Hawaiian Gardens Casino and Bicycle Casino, two of Commerce’s largest competitors, did not respond to requests for comment.

To help facilitate the arrangement, three other venues offering satellite betting in Southern California Inglewood’s Hollywood Park, which allows the wagering both at the track and in an adjacent card club owned by the same company; Santa Anita race track in Arcadia; and Orange County’s Los Alamitos Race Course agreed to waive requirements restricting competition within a 20-mile radius.

Satellite betting is also offered at several Southern California tribal casinos: Verona in Lakeside, Fantasy Springs in Indio and Viejas in Alpine near San Diego. A fourth Indian casino Sycuan in El Cajon is remodeling its wagering facilities, which are expected to reopen soon.

Meanwhile, Varela said he is in discussions with some Southern California sports bars about possibly opening horse-race books there, though he wouldn’t name names.

“This is the first time we can go out and offer something in areas that are underserved,” he said, “where we can reach out a little more and expose our game to new people.”