HARRISBURG -- For two years, Lawrence County residents and officials have been patiently waiting for an Indianapolis company to begin construction on a $425 million racetrack/casino west of New Castle.

The county's recession-plagued economy urgently needs the hundreds of new jobs that the Valley View Downs & Casino project would bring, locals say. Construction permits are in hand, and some land preparation has occurred at the 250-acre greenfield site along Route 422 near the Ohio line, but no actual digging or foundation work has begun.

"I sincerely hope they can get moving soon. We're all rooting for them to bring this to fruition. Lawrence County is desperate for the jobs and for additional tax revenue for local and county governments," said New Castle businessman Carmen Shick, whose family sold Centaur Inc. the land for the project and who wants to build an indoor water park and retail area adjacent to the racetrack/casino.

But so far, Centaur has only one of three things it needs to get started. Almost exactly two years ago -- Sept. 5, 2007 -- it was awarded a harness racing license by the state Harness Racing Commission.

But with the ongoing recession, Centaur has been unable to get financing for the project. And until it gets the cash, state Gaming Control Board officials won't consider Centaur's application for a slots license.

Centaur is caught in a Catch-22 situation. Initially it did have financing, but lost it in mid-2008 because it didn't have a slots license. And now it can't get the slots license until it has the money for the project.

Centaur spokeswoman Susan Kilkenny said the company is working hard to get the project started.

"The financial markets traditionally take a hiatus during August," she said. "However, we continue to aggressively pursue strategic alternatives for the development and successful launch of Valley View Downs & Casino."

She wouldn't describe the "alternatives" being explored, saying only that they "reflect an extremely wide variety of options." She said that "at this time," it's best "not to fuel additional speculation by outlining a handful of options."

Because of the great amount of "time, energy and dollars invested in this project," she said, "we look forward to providing additional concrete information as available. Until such time, we thank all for their patience."

People who work in the harness-racing industry are just as eager as Lawrence County officials to see the project built. The harness track would be a mile-long track, the first one of that length in Pennsylvania, said Jim Simpson, president of Hanover Shoe Farms in south-central Pennsylvania. His farm is the world's largest breeder of standardbred horses, the breed used in harness racing.

"We in the industry sure want to see that track built," Mr. Simpson said.

Three existing harness tracks -- The Meadows in Washington County, Pocono Downs near Wilkes-Barre and Harrah's Chester Downs near Philadelphia -- all have tracks that are five-eighths of a mile long, he said.

A mile-long track could bring to Pennsylvania the prestigious Hambletonian race, known as the Kentucky Derby of harness racing and now held at a mile-long track in New Jersey.

Time may not be on Centaur's side. One of the advantages of its site -- so close to the Ohio border -- was its ability to draw Ohio residents, especially from the Youngstown and Cleveland areas.

But recently, Ohio Gov. Ted Strickland has decided to allow his state's seven racetracks, including two in Cleveland, to add up to 2,500 slots each. So by the time Valley View Downs is up and operating, it likely will have to compete with Ohio tracks for customers.

Ms. Kilkenny said Centaur continues "to closely monitor" developments in Ohio, adding, "We are confident our plans will be competitive" with any expanded gaming in Ohio. Adding table games to Pennsylvania casinos would help Valley View Downs compete against Ohio, she added.

Everyone agrees that slot machines bring many more people to a racetrack. All three existing harness racetracks in the state have casinos, each with about 3,000 slots. Slots have boosted tracks' popularity and significantly increased the amount of the purses or prize money for race winners.

A Pennsylvania law enacted in 2004 permits four harness track/casinos in the state. Valley View Downs would be the fourth and final one. The law also authorized casinos at three thoroughbred racetracks -- near Harrisburg, Philadelphia and Erie.

Because of the delays Centaur has faced in getting started, the state Harness Racing Commission has extended its racing license until Sept. 5, 2010. Centaur must "commence live harness racing on or before" that date or risk losing the racing license, said Agriculture Department spokesman Justin Fleming. The harness commission falls under the Agriculture Department.

"Certainly, the commission continues to monitor Centaur's situation," he said. "We still maintain their application for a license was a good one. We hope live racing can take place there" by September 2010.

As for the state Gaming Board, "We're still waiting for them to put together a financing package for the board to consider," said spokesman Doug Harbach. "Centaur is the only qualified applicant (for a slots license) at the present time because they hold the racing license."

The delay in building Valley View Downs, combined with an extended delay in building two large stand-alone slots casinos in Philadelphia, is hurting the state's effort to generate maximum revenue for property tax reductions for Pennsylvania homeowners.

The 2004 law called for 12 large casinos, each with up to 5,000 slots -- seven at racetracks and five "stand-alone" casinos. So far, nine casinos have opened, the most recent being the Rivers Casino in Pittsburgh. The law also calls for two smaller gambling parlors, each with only 500 slots, at resort hotels. They're not open yet.