Posts Tagged ‘New York Racing Association’

By Ray Paulick
It was a sure thing that New York politicians would complain about the annual compensations paid to New York Racing Association president Charlie Hayward and chief operating officer Hal Handel, who reportedly are paid $460,000 and $440,000 per year, respectively. And true to form, Democratic Assemblyman Gary Pretlow chimed in with the following comment to the New York Daily News when the salaries were disclosed in a letter from NYRA to the state’s Franchise Oversight Board: "They’re running an unprofitable business making exorbitant salaries."

Running NYRA is no easy task, especially when you are hamstrung by some of the most short-sighted legislators on the American political landscape. Those legislators, along with three New York governors, took nearly 10 years after enabling legislation to name a VLT operator at Aqueduct, a delay that created an enormous economic hardship on the racing association. And the recent controversial appointment of the Aqueduct Entertainment Group to operate the VLT franchise could be held up for the unforeseeable future.

Let’s also not forget that it isn’t Hayward and Handel’s fault the state is facing an $8.2-billion budget deficit.

In NYRA’s letter to the Franchise Oversight Board, it was stated that NYRA’s two top executives are underpaid in comparison to the association’s leading competitors in the racing and gaming world.

The Paulick Report examined Internal Revenue Service Form 990s from 16 different national or state non-profit associations involved in Thoroughbred racing and breeding to see how their executive compensations compare with those reported for NYRA executives. Following is the result of that salary survey. The survey looks strictly at non-profit associations, none of which are engaged in the operation of a racetrack or racing circuit. The compensation listed is base salary without regard to retirement benefits or additional compensation. The salaries reported are for the most recent year available at www.GuideStar.com, which monitors non-profit organizations.

By Ray Paulick
One or two million dollars just doesn’t get you what it used to.

Was it that long ago that felonious financier Robert Brennan shook up racing’s Triple Crown with a $2-million bonus linking victories in three stakes at the now-defunct Garden State Park in New Jersey with a win in the Kentucky Derby? Spend a Buck went after and won that bonus following his runaway victory in the 1985 Kentucky Derby, leaving  officials at the three Triple Crown tracks apoplectic when he skipped the Preakness and Belmont Stakes. They were so worried they went out and did the unthinkable: working together to create their own bonus scheme (which has now lapsed after Visa dropped its Triple Crown sponsorship).

The original Triple Crown Challenge bonus would pay a total of $5 million in purses and bonus money to any horse that won the Triple Crown (it was upped to a $5-million bonus plus purse money in 1997), and a $1-million bonus to the horse accumulating the most points from top three finishes in all three races. The latter bonus was dropped after the 1993 Triple Crown.

The absence of a bonus hasn’t hurt the Triple Crown, although without a participation bonus there have been fewer 3-year-olds running in all three races. I guess the feeling is that the owner of a horse that wins the Triple Crown will get his bonus when he retires him to stud (assuming he’s not a gelding or filly).

This past year, several entities clamored to get 3-year-old filly superstar Rachel Alexandra and older female champ Zenyatta in the same race. Jim McIngvale, the Houston furniture store owner better known as Mattress Mac, made the first run by offering to put up $2-million for a match race at Sam Houston Race Park in his home town. That gave McIngvale 15 minutes or so of free publicity, but it was a match race that was never going to happen. (McIngvale’s Gallery Furniture recently announced it is sponsoring a new $100,000 race on the Texas Day Champions program Dec. 5 at Sam Houston, proving he’s more than a publicity seeker. McIngvale and the Houston track haven’t given up on a race involving the two fillies, either, and offered $1.5 million if they showed up to face one another during the track’s winter meeting.)

TVG then teamed up with the New York Racing Association in an effort to get Rachel Alexandra and Zenyatta to both contest the Oct. 3 Beldame at Belmont Park. TVG offered to put up $400,000, which would increase the purse for the Grade 1 race to $1 million. That at least got some consideration from both camps, but it wasn’t in the cards for either Rachel Alexandra or Zenyatta.

Finally, the Breeders’ Cup gave it the old college try, offering to pad the winner’s share of the $5-million Breeders’ Cup Classic if both Rachel Alexandra and Zenyatta were in the starting gate. That would have resulted in a $3.7-million winner’s share of the Classic. But Rachel’s majority owner, Jess Jackson, had already made it clear he wouldn’t run his filly on the synthetic track at Santa Anita which he disparagingly calls “plastic.”

It’s no wonder, then, that the Japan Racing Association is having a hard time getting much buzz over its Autumn International series of four Grade 1 races on consecutive Sundays, beginning Nov. 15 with the Queen Elizabeth II Commemorative Cup, and continuing with the Nov. 22 Mile Championship, the Nov. 29 Japan Cup and Dec. 6 Japan Cup Dirt. The four races offer about $13 million in total purses, plus lucrative bonuses for horses that have won or finished second in major stakes in North America, Europe, Australia or Dubai.

For example, if Kentucky Derby winner Mine That Bird won the Japan Cup Dirt, a 1 1/8-mile race run clockwise at Hanshin racecourse in Osaka, he would receive $1.37 million of the $2.9-million purse but also get a bonus of $1.37 million for his Derby win, making the victory worth a total $2.7 million. That’s about the same as the Breeders’ Cup Classic’s winner’s  share of its $5-million purse. I’d venture to say Mine That Bird would face a much softer field in Japan than he’ll see on the Pro-Ride track at Santa Anita. Of course, he could run in both races.

The Derby is but one of 12 American races whose winners would qualify for a bonus ranging from $525,000 to $1.37 million for winning the Japan Cup Dirt. Even a second-place finish for those horses in Japan would pay them a bonus between $210,000 and $550,000. Click here to see the bonus scheme for the Japan Cup Dirt.

The Japan Cup on turf has similar bonuses. That race winner could take home more than $4 million in purse money and bonuses and the second-place finisher could win as much as $1.6 million in purse and bonus money. Click here for complete information on the Japan Cup’s purse and bonus details.

Nevertheless, based on recent interest in the Japanese races from American horsemen, it’s doubtful many serious contenders will be shipped to Tokyo or Osaka to contest these rich races, bonuses or not. No American horse has won the Japan Cup since 1991, when the late Charlie Whittingham sent Golden Pheasant postward for a victory. Golden Pheasant was the fourth American horse to win the Japan Cup in the race’s first 11 years.

In recent years, the Japanese have dominated the race with horses they bred or bought in the West as yearlings, winning nine of the last 11 runnings. The quality of Japanese-bred horses has improved, largely through the importation of stallions and broodmares from Europe and the United States in the 1980s and ‘90s. I think Americans have gotten tired of sending their horses over to Japan and getting their butts kicked.

The Japan Cup dirt, inaugurated in 2000, has had just nine runnings, with eight going to Japanese-trained horses. The lone exception was in 2003 when the Doug O’Neill-trained Fleetstreet Dancer, a previously unheralded runner in California, posted a huge upset.

American horsemen have been leery of sending good horses to the Japan Cup dirt, in part over legitimate concerns that the dirt tracks in Japan are deep and sandy. In fact, when Fleetstreet Dancer won, it may have been due in part to the fact rain tightened up the racetrack.

There’s a lot of money at stake in the Japan Racing Association’s Autumn International races, but purse money apparently doesn’t carry as much weight as it used to for some horse owners. Either that, or American horses ain’t what they used to be.

Copyright © 2009, The Paulick Report

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Ed Martin, president of the Association of Racing Commissioners International, took exception to horse owner Barry Irwin’s guest commentary published here last week (Hey, states…take a hike!) that suggested racing would be better off if it managed to get states out of the regulatory business and allow the industry to police itself. The former executive director of the New York Racing and Wagering Board believes regulators are not part of racing’s problems but of its solutions. He also said regulators are working on an interstate compact that could bring states much closer to uniformity in rules and regulations governing the sport.By Ed Martin
Every now and then someone pops off out of frustration, raising the prospect of trying to figure out how racing can self-police its gambling enterprises. Such was the case with last week’s commentary by Team Valor president Barry Irwin suggesting the possibility that the independent state racing commissions can somehow be eliminated and the industry will just foot the bill and take care of everything, bringing all sorts of fans, new and old, back to the sport.

Yes, it is true state governments are facing hard economic times. So are the American people, including most racing participants and fans. The elimination of the government regulation of this form of gambling will destroy this sport in ways that I am sure Mr. Irwin does not intend or envision. Perhaps if there were no gambling, then his idea might make sense. So, unless he seeks a private club with no gambling everyone’s time is wasted contemplating the insane idea that elected officials are going to allow gambling enterprises to self police themselves. It’s a bad idea that will not pass the smell test.

To bolster his case, Irwin cites how the New York Racing Association in New York was victimized by the state. Excuse me, but NYRA did have to march in front of a federal judge and admit to a conspiracy to defraud the government. The “we have great racing and we know what we’re doing” defense wasn’t going to work given the magnitude of the felony that cheated the public regardless of whether they were racing fans or not. This was a terrible black eye on racing by an entity governed by some of the most prominent individuals in American Thoroughbred racing and it would not be in racing’s future interest for people to minimize the seriousness of that situation.

As one who worked on that case, it was amazing that NYRA refused to do a daily cash count and reconciliation in the mutuel department. They do that at the corner grocery store, but somehow this was something to be resisted when suggested by the state. I will never forget the day when NYRA sent in a team of some of the most politically connected trustees to argue against a daily cash count. One of those present was the president of my bank. I stopped using that man’s bank.

Sure, let’s open some champagne and make those nasty state regulators go away. After all they were the ones who investigated and cracked the case that exposed how a tote company’s computer programmer could access a live wagering file and turn a losing Breeders’ Cup Pick 6 wager into a winning one. The New York Racing and Wagering Board partnering with the New York State Police cracked that case within 48 hours of Valponi’s Classic win. What was amazing in doing the investigation was that this activity had gone on undetected for some time and no internal controls, self auditing or self policing program had safeguarded the industry’s interests. We unearthed a problem plaguing the industry and regulators alike.

Mr. Irwin seems to like the Stewards, who for the most part are employees of the state commissions. Well, we must be doing something right. But he does not appear to tolerate due process. Commissions are as frustrated with this as anyone, but perhaps if Mr. Irwin had been around in the days of Ben Franklin, Thomas Jefferson and John Adams, things might be different. In a system of due process, allegations must be proven based on solid evidence. People have a right to appeal and we are always open to solid suggestions as to how to minimize the ability of some to “play the system”. The concept of a Monarch was rejected in the revolution and we have no choice but to accept the constitutional guarantees that we all enjoy, including the scoundrels.

At no point in the almost five years I have been at RCI or the preceding nine at the New York Racing and Wagering Board did Mr. Irwin ever make a suggestion directly to either entity as to how to more effectively tackle racing’s integrity challenge. Things can always be done better but racing should never forget that when it comes to drugs, we test for more substances at deeper levels than any other professional sport. There is a lot that is done right, but you’d never know it as some explain their loss by leveling undocumented charges against winners. Perhaps if racing stopped casting aspersions on those who are successful on the track or at the betting windows we might be able to generate some excitement and attract new fans. But no, if you hit a lucky streak you must be cheating.

The only entities that sort out what is real and what is not are the state racing commissions. Those who cheat will do it for the money and the initiatives of RCI and the state regulators to track the money through independent real-time wagering monitoring have met with nothing but unexplained resistance or foot dragging from key industry entities. Some of those barriers are coming down, but oh so slowly. I agree with Mr. Irwin that cheaters can kill this sport, but why do we devote all our attention to following the drugs and virtually none to following the money? The money path will help identify the real drug problem or fraud by collusion. It is unexplainable to me that people resist when the regulators want to chase the money in addition to chasing the drugs.

The state regulators have been calling for reforms and could really use some help from the industry in terms of either money, commitment, or support in state capitals to protect commission budgets that pay for drug testing, pre-race exams, backstretch investigators, the officials, the background checks, name it. In these tough times racing regulatory commissions are vulnerable targets for state budget offices looking to fill potholes rather than test more horses for drugs or monitor betting activity. We’re not perfect, no institution or person is. But every regulator that I know is committed to trying to do the job as best as possible, despite the lack of budgetary or industry support.

There are those who want to create a federal regulator which would just create another layer that would have to be paid for. An alternative is to explore the concept of creating a national regulatory body through a new interstate compact, a mechanism for state regulators to act as one in certain instances. Just this week, 15 state regulatory commissions held a joint discussion on how a proposal working its way through the New York legislature might work in their states. There is progress being made and the impetus is coming from the RCI member staffs, vets, labs and vendors who form the backbone of the Racing Medication and Testing Consortium’s drug initiative.

When I started with RCI in 2005, we called for a new public private partnership and a restructuring of our collective “integrity efforts”. I reiterated that at this year’s Racing Congress. No takers. Rather than partner with the regulators, pool resources and improve the status quo, new entities are formed, funded and promoted by hired guns. Dump on us all you want but state racing commissions are a given and we will not stop in trying to raise the bar.

Please join with us Mr. Irwin. Perhaps together we can break the negative energy that is sinking this sport.

By Ray Paulick
Jess Jackson, the principal owner of star filly Rachel Alexandra, said during a New York Racing Association media teleconference on Wednesday afternoon he has no intention of ever running the Kentucky Oaks and Preakness winner on “plastic,” or synthetic racetracks, and ruled out any chance she would compete in this year’s Breeders’ Cup World Championships.

However, Jackson did say that if the daughter of Medaglia d’Oro remained healthy there was a very good chance she would remain in training in 2010 as a 4-year-old, with the Breeders’ Cup at Churchill Downs a year-end goal.

Jackson and Rachel Alexandra’s jockey, Calvin Borel, answered a wide range of questions from the media in advance of Saturday’s Mother Goose at Belmont Park, in which Rachel Alexandra will be heavily favored. NYRA is offering free admission for women and giving away 10,000 pink bracelets embossed with Rachel Alexandra’s name in conjunction with the announcement by Jackson and his wife, Barbara Banke, to give a portion of any prize money won by  the filly to the Susan B. Komen Race for the Cure for breast cancer.

While he gave no indication where Rachel Alexandra would surface following this weekend’s race against fellow 3-year-old fillies, Jackson said he wanted to run her against colts again, and included the nine-furlong Haskell Invitational at Monmouth Park Aug. 2 and 10-furlong Travers at Saratoga Aug. 29 among the possibilities for her this summer. Each race for 3-year-olds carries a $1-million purse.  He also listed as possible starts the $300,000 Coaching Club American Oaks for 3-year-old fillies going 10 furlongs at Belmont Park July 25; the $1-million Delaware Handicap , a 10-furlong event for fillies and mares, 3 and up at Delaware Park July 19; and the $600,000 Alabama for 3-year-old fillies going 10 furlongs at Saratoga Aug. 22. The spacing of her races was important, Jackson said, along with her physical condition.

Jackson said he would love to meet reigning filly and mare champion Zenyatta, but that it would have to happen outside of California. “I would hope we’d meet, but if it’s not in the stars, it’s not going to happen,” he said. “They’re going to have to come east or to some neutral track,” he said. “I’m not going to run on plastic (all of California’s major tracks have a synthetic surface instead of dirt). We don’t need to risk her that way.” Jackson said synthetic tracks tend to favor turf horses and that Rachel Alexandra has proven herself on the dirt. “You can’t predict the outcome of a race on plastic,” he said. “You see horses all finishing in a bunch.” Also, Jackson said the various synthetic manufacturers (Pro Ride, Cushion Track, Polytrack, Tapeta) each produce varying surfaces. “Man is interfering with nature,” he added.

Borel said he is confident the drop back to a one-turn nine-furlong race for Rachel Alexandra will not be a problem after going around two turns in her recent races. “She’s very versatile,” he said. “I’m going to ride that filly with confidence. For me to go out there and not ride her with confidence would be stupid.”

In other news, Jackson, a Californian who is a major contributor to both the Democratic and Republican parties in Kentucky, said he supported recently defeated legislation in Kentucky to bring video lottery terminals or slot machines to the state’s racetracks, though he admitted he “didn’t work hard for the bill because I was back working in California on the wine business. When I support a party or candidate, I do it so they can vote their own conscience. I look at the slots and gambling as an interim or short-term solution. The long term is best served if we can get together and voluntarily form a major league office with a commissioner.”

Jackson also said he “has been approached and am involved in trying to save Santa Anita Park,” which is scheduled to be sold as part of the Magna Entertainment bankruptcy proceedings. The Thoroughbred Owners of California recently confirmed it is planning to bid on the track in a bankruptcy auction. Jackson added that he is considering sending both mares and stallions to his home state in order to improve California’s breeding industry.

Copyright © 2009, The Paulick Report

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