Thoroughbred tracks from coast to coast suffer from a shortage of horses that is caused by a shortage of horse owners. Even in states such as California and New York, purses aren't large enough to make buying a racehorse a rational investment. While racetracks earn profits, horse owners rarely do.

But at little Charles Town, the usual economics of the game have been turned upside down. The introduction of slot machines in 1997 brought the track back from extinction. Its once-dilapidated grandstand has been transformed into a spiffy modern casino; the section of the plant devoted to thoroughbred simulcasting is as well-designed as that of any major track. Yet the most remarkable change at Charles Town is this: A horse owner may have a better chance to make money here than at any other U.S. track. Even so, Charles Town's parent company is still struggling to break even on its racing operations.

After Jefferson County voters approved slot machines (technically known as video lottery terminals, or VLTs), Penn National Gaming exercised an option to buy Charles Town. Running the money-losing racetrack was a price it had to pay to operate slot machines that were certain to be profitable. But Bill Bork, the company's president, declared that racing--not slot machines--was his great love, and that he intended to make Charles Town a successful track again.

With 14 percent of slot revenues earmarked for purses, Charles Town now gives away an average of $75,000 a day--up from $22,000 in the dark days before the machines were legalized. This money has created rare opportunities for lower-level claiming horses. On Wednesday night, Charles Town carded a $5,000 claiming race, the type of event that has always been its staple, except that now the horses were competing for a $9,900 purse. In Maryland, horses in the same claiming category run for $8,000.

"The purses are so good now that it's hard to get hurt," said trainer Lee Couchenour. "If you take a horse for $5,000, you've got a lot of possibilities." If you won the $5,000 claiming race Wednesday, you collected $5,940, the winner's share of the purse, and you immediately recouped the entire cost of the animal. But if you spend $5,000 for a horse who isn't worth the money, you can still get even by dropping him into bottom-level $2,500 claiming races and running for $6,000 pots.

Not only are the purses generous, but the expenses are low at Charles Town. The cost of maintaining a horse is only about $1,000 a month--about half of the upkeep for a horse stabled in Maryland.

As a result, owners and would-be owners have a much different attitude toward the game. "When we were giving away $22,000 a day," said Dickie Moore, the general manager of racing operations. "There was no way it was possible to make money, and a lot of people got out of the business. Now they're getting back in because they know they have a chance to make money--or at least to break even."

In 1996, the year before slots were introduced, a total of 13 horses were claimed during an entire year at Charles Town. This year, the claims have exceeded 500; one horse has changed hands seven times. The racing has become highly competitive and the fields are large. When entries were taken for Saturday's card, racing secretary James Hammond said, "We had 169 horses entered; there were two maiden races with over 40 entries. It's wonderful. It's a racing secretary's dream."

When Penn National Gaming took over Charles Town, Bork envisioned simulcasting its races to other tracks, but delayed doing so "because I was afraid the quality wasn't there." Low-level claiming races remain the backbone of the Charles Town cards, but now at least they are competitive, bettable low-level claiming races, and this summer the track started trying to sell its product in the simulcast market. Would out-of-state players bet cheap 4 1/2-furlong claiming races from a minor league track? The answer was yes.

By operating at night, Charles Town has relatively little simulcast competition. And by regularly filling its 10-horse starting gate, the track gives horseplayers the large fields they relish. Already Charles Town is attracting about $300,000 a day in simulcast wagers, and if it can increase this total to $450,000 it will be in the black.

"When we came here, Charles Town was losing $2 million a year," Bork said. "This year we're going to lose $600,000. By next year we are going to make money--most of it coming from [simulcast] export."

Bork has other reasons for optimism besides the growth of simulcasting. The West Virginia Lottery Commission on Wednesday gave Charles Town its approval to install 500 more machines--real slot machines, with coins clanging into a tray when a player has a winner. (Until now, the machines in the state gave players a voucher that they cashed at a window, and such devices were not wildly popular.) With the new machines, Charles Town is going to have a surge of revenue that will bolster the racing operation further. "I can predict that within a year our purses will be $125,000 to $150,000 a day," Bork said. When purses reach that lofty level, a cheap West Virginia claiming horse may be considered a blue-chip investment.