Posts Tagged ‘kent hollingsworth’

By Ray Paulick

This Sunday in Saratoga Springs, N.Y., Ogden Mills Phipps  – better known as Dinny throughout the Thoroughbred world – will preside over the 56^th Jockey Club Round Table Conference on Matters Pertaining to Racing.

For those who have never attended, there is no “round table” at this annual throat-clearing exercise for many of the industry poobahs, and there is not really any discussion, either. It’s a precisely orchestrated show that leaves nary a stanza for improvisation, and there is no question about who the conductor is waving the baton. According to several individuals who have spoken at past Round Tables, Dinny Phipps goes over every speech with a fine-tooth comb, cutting out things he doesn’t like and adding points he wants to have made.

The Round Table is one of the projects of the Jockey Club that Phipps has overseen since becoming the breed registry’s chairman in 1982. That same year, William S. Farish became the Jockey Club’s vice chairman. That’s 26 years running as a two-man team, 

But let’s not look ahead to Sunday’s festivities just yet. Let’s go back in time to a day when Dinny Phipps wasn’t trying to save the entire Thoroughbred industry; he was merely applying his business skills, enthusiasm and charisma to New York racing.

Some people who confuse wealth and power with vision and business intelligence might say that Dinny Phipps was born to lead. He is a member of one of America’s wealthiest families. His great-grandfather, Henry Phipps, was Andrew Carnegie’s partner in what became known as U.S. Steel, and he was the founder of Bessemer Trust, for which Dinny Phipps has served as chairman. As if that wasn’t enough, Dinny Phipps’ grandfather, Henry Carnegie Phipps, married into another of America’s wealthiest families, that of Darius Ogden Mills, who struck it rich in the California Gold Rush. At one time, the Phipps family owned roughly one-third of the exclusive island enclave of Palm Beach, Fla., where Dinny Phipps officially resides (Florida has no personal income tax).

Dinny Phipps followed his grandmother (Mrs. Henry Carnegie Phipps of the Wheatley Stable) and his father, Ogden Phipps, into Thoroughbred racing. Phipps and his father also were skilled at “court tennis” (some call it real tennis), a game that also found popularity with royalty in 16^th and 17^th century France and England. Ogden Phipps was a mover and shaker in New York racing, serving for years as a trustee of the New York Racing Association and also as chairman of the Jockey Club.

Dinny Phipps was made a member of the Jockey Club in 1965, when he was just 24 years old. In 1971, at the age of 30, he was appointed to the board of trustees of the New York Racing Association. It was the same year the first Off-Track Betting shop opened in New York, a development that sent on-track business at the NYRA tracks into a long and steady decline.

Young Phipps wasn’t entirely a chip off the old block. Whitney Tower, writing in Sports Illustrated, said most members of the Phipps family went out of their way to avoid publicity. Tower wrote in 1965: “Until Dinny slightly altered the family pattern by hobnobbing in track press boxes and frequenting Toots Shor’s (a midtown Manhattan bar and grill frequented by celebrities and athletes), none considered the press anything more than a necessary evil of the modern age."

Tower, whose sense of humor could be wicked, also wrote of the young (and still growing) Phipps’ court tennis skills in the 1965 article that featured the Phipps family’s Bold Lad, an early season Kentucky Derby contender. “Dinny, who, like Bold Lad, has never missed an oat in his life (weight, 275 pounds), is defending amateur doubles champ with Northrup Know, after playing No. 2 on both the tennis and squash teams at Yale.”

Phipps was moved up to a newly created position of vice chairman of the NYRA board in 1974. The chairman, Jack Dreyfus, bred and raced under the name Hobeau Farm and was best known as the creator of the mutual fund through his financial company, the Dreyfus Fund. Dreyfus also spoke willingly about his bouts with clinical depression and became a vocal proponent of a drug he was given to treat the problem.

In an extraordinary editorial in the Feb. 16, 1976, Bloodhorse magazine, editor Kent Hollingsworth called for Dreyfus’ ouster as NYRA’s chairman.

‘The roof is leaking,” Hollingsworth wrote of NYRA and its three racetracks, Aqueduct, Belmont Park, and Saratoga. “In other sports when the trend is downward, the coach or manager is fired. … (Dreyfus) has lost the confidence of a growing number of New York owners and trainers and cooperation of management and horsemen is absolutely essential to reverse the downward trend of New York racing.”

Hollingsworth then endorsed Phipps to become the new chairman.

“Young Dinny Phipps, vice chairman of NYRA, has the support of most New York owners and trainers. As chairman, Phipps would be more accessible, and greater cooperation with horsemen could be attained. Also, the vacant slot for a director of racing needs filling now, by a man who has the experience and rapport with both management and New York horsemen. … The NYRA needs new – not just new, but better – direction. It needs it now, for all of racing cannot afford to have New York racing continue downward.”

Five months later, in July 1976 Dreyfus stepped down and Dinny Phipps was appointed NYRA’s chairman. “I hope I can fulfill the duties of this office with the same energy, foresight and creativity displayed by Jack Dreyfus,” Phipps was quoted in the Bloodhorse. “Working under him has been a valuable experience.” The Bloodhorse article gave no professional or business background  on Phipps, only saying that he was the son of Ogden Phipps.

By today’s standards, on-track business looked pretty good when Phipps took over. Aqueduct’s early-season meeting had average on-track attendance of 20,722, Belmont Park’s summer meeting averaged 24,387, and its fall meeting averaged 20,363. Saratoga had a daily average of 18,894.

But there were serious problems, and they would only get worse. By the time Phipps left in 1983, those same numbers were 13,340 at Aqueduct, 19,530 at Belmont summer and 16,735 for Belmont’s fall meeting. Saratoga was the lone bright spot, increasing to 26,644 by 1983.

Phipps spoke before New York legislators after his appointment, saying: “Thoroughbred racing in New York State, once a growth industry, has fallen on evil days, and a period of crisis is clearly upon us. And this has happened, purely and simply, because growth has stopped. … There may be those who will argue that concern for on-track growth is misplaced in the era of OTB and who anticipate the day when tracks will operate primarily to serve off-track clientele. If this day comes, we believe it will mark the end of both OTB and the tracks. We do not believe that OTB can flourish and prosper in a climate of ever-declining interest in on-track racing. The tracks make customers for OTB, not the other way around.”

But under the headline “Better Days Ahead,” a story in Bloodhorse magazine in November 1976 quoted Phipps telling the American Trainers Association that NYRA was going to “make an all-out effort” to improve conditions.  

The efforts went unnoticed by Sports Illustrated the following June after Seattle Slew clinched the Triple Crown with a win in the Belmont Stakes. “The 70,000 people who showed up at Belmont Park Saturday did so despite the best efforts of the New York Racing Association to keep the race a secret,” the Scorecard item read. “No wonder the NYRA is in trouble. … NYRA chairman Dinny Phipps needed a bang-up selling job. So, the week of the Kentucky Derby, just one month before the Belmont, Phipps hired a marketing expert and gave him the title vice-president in charge of marketing. It seemed like a smart move.

"But new VP Ted Demmon admits that the only thing he knew about horses is which end the tail is on. “His previous job was marketing vice-president for Hardee’s, the ‘hurry on down to’ hamburger joints, where he was also in charge of product development. While Phipps hasn’t yet assigned him that job, someone at the NYRA should have told Demmon that a man named Billy Turner has just spent a year developing the hottest product the NYRA could have hoped for. Yet just three days before Seattle Slew was to become the first undefeated Triple Crown winner in the history of racing, the television ads in New York were still inviting people to come out to beautiful Belmont Park, where, just maybe, some afternoon they might see another Secretariat.”

At the end of 1977, his first full year as chairman, Phipps was scarcely mentioned in Bloodhorse’s annual index of articles. The few references included the fact he had commissioned artist Richard Stone Reeves to paint a portrait of Bold Ruler, that he was awarded the P.A.B. Widener Trophy in Kentucky, that he was re-elected as a director of the Grayson Foundation and that he and his wife had a son born in July (sort of like those stud news items that announce when a major stallion’s first foal is born).

But things were happening at NYRA. In September 1977, Thomas FitzGerald was forced out as NYRA president and James Heffernan was brought in to replace him. There were labor problems with mutual clerks, and a TV deal was struck to show some major races on CBS.

The major emphasis after Phipps took over as NYRA chairman was to convince then-Gov. Hugh Carey to push for a reduction in takeout in hopes that it would stimulate handle and on-track attendance. Independent research commissioned by NYRA, the Pugh-Roberts Study, showed business would go up between 12-15%. How hard did Phipps work on this? “We put in two hours every working day just on this one thing,” said Phipps, who even made two trips to the state capital in Albany. Eventually, a 20-month takeout reduction experiment was approved, and Phipps became the toast of racing. 

The New York Turf Writers named him “the man who did the most for New York racing.” In February 1979, Phipps was given the Eclipse Award of Merit by a committee representing Daily Racing Form, the National Turf Writers Association and the Thoroughbred Racing Associations.

Hollingsworth, Bloodhorse’s editor, remained one of Phipps’ biggest supporters, writing of NYRA: “The management is tops; NYRA board chairman O.M. (Dinny) Phipps is young, innovative, responsive, with a competent staff of experienced professionals that knows what should be done and does it.”

Six months after giving Phipps the Eclipse Award of Merit, however, the presenters might have wanted to call for a “do-over.” Business at the Belmont summer meeting was down in attendance and up only slightly in handle after the takeout reduction, falling well short of the Pugh-Roberts Projections. NYRA’s overall year-to-date business was even more dismal, with attendance dropping 13% and betting off 8.4% through the first seven months of 1979.

“Despite reduced takeout and million-dollar promotion campaign, no light has appeared yet at the end of the tunnel,” Bloodhorse’s New York correspondent William Rudy wrote. “Nor was the atmosphere a happy one. Horesmen were irate over what they termed general ineptitude in the racing department, and a new organization, the New York Thoroughbred Horsemen’s Benevolent Association, was formed with Jack Gaver president and Joe Trovato and Murray Garren vice presidents. The group issued a statement that said: “You must be able to communicate with the NYRA if you have a problem or disagree with existing policies. … The fact is that the NYRA now is pretty much a closed shop at top levels.”

The critical Bloodhorse article said NYRA’s board members were mostly yes men who “all go along with decisions made. … Members are often informed at board meetings of actions already taken. There is, on occasion, dissent from former NYRA chairman Jack Dreyfus Jr., a gentleman who seems inhibited by a feeling he should not criticize his successors.”

For his work, Phipps was rewarded with re-election as chairman in May 1980, a year that ended just as poorly as the previous year: Belmont attendance was down 8.2% and 3.8% in handle, while Aqueduct’s late-season meeting dropped 13% in atteance and 8% in handle.

The following year, former treasurer Jerry McKeon replaced Heffernan as NYRA president. The legislature began looking at the 1985 expiration of NYRA’s franchise and invited racing people to speak at a hearing of a joint legislative task force in Albany. Penny Chenery, who raced Secretariat, expressed her displeasure over the actions of the board and management of NYRA, telling legislators: “If you gentlemen perceive as I do a lack of responsiveness on the part of NYRA, I urge you to require of the board of trustees responsibility for the performance of the NYRA and its CEO,.”

After nearly 6 ½ years as NYRA chairman, Phipps resigned the post in January 1983, and he was succeeded by Thomas Bancroft, who also failed to reverse the slides at Aqueduct and Belmont that accelerated during the Phipps era (Saratoga was an exception). 

Phipps has remained on the NYRA board, and some have likened his stepping down in 1983 to the recent replacement of president Vladimir Putin in Russia, who was constitutionally prohibited from running for a third consecutive term. Just as Putin has not stepped aside after being nominally replaced by Dimitri Medvedev as president (Putin remains “prime minister”), high-placed industry sources say that Phipps continues to call many of the shots in New York racing from behind the scenes.

In that is the case, Dinny Phipps, if nothing else, is a master of the power play.

Copyright © 2008, The Paulick Report

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