Ohio’s Racing Future No Laughing Matter

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You might say Ohio’s Thoroughbred industry is a lot like Cleveland.

For many years, the city was the butt of late-night jokes and to outsiders, exemplified the decline of urban America.  Within the racing industry, Ohio became a similar source of derision in pointing out problems plaguing the sport – low purses, short fields, poor quality, a crumbling breeding industry.

But much the same way Cleveland remade itself and shed many negative perceptions, Ohio’s racing business could be poised to trigger a renaissance.

“We’ve been in a death spiral,” said Robert Schmitz, chairman of the Ohio State Racing Commission.

Schmitz is among those hoping to lead the Buckeyes out of the dark days.  Ohio, a state with a rich history of harness racing, is hitching the industry’s “sulky” to the dramatic increase in gaming approved by state lawmakers in recent years.

The current strategy is a dizzying array of moving parts, designed to maximize casino and racino revenues across the state, with benefits for Thoroughbred and Standardbred breeding and racing.

Thoroughbred track Beulah Park, near Columbus, is planning to relocate and build a racino in the Youngstown area.  The harness venue, Raceway Park, will do the same, shifting from Toledo to Dayton.  Scioto Downs has already added video lottery terminals, and the state’s five other tracks – the Cleveland area’s Thistledown and Northfield Park, Cincinnati’s River Downs, and Lebanon Raceway near Dayton, have plans to add them.  When all is said and done, there will be seven racinos and four stand-alone, Vegas-style casinos.

“This is a new paradigm for us, a whole new deal,” said Schmitz.

For the racing commission, the ‘deal’ amounts to 3% of the tax the casinos pay to the state – money that will go to purses, breeding funds, and to a lesser extent, the racetracks.  Schmitz is particularly keen on improving Ohio’s Thoroughbred breeding program.

“There are a very, very limited number of Ohio-accredited horses, by an Ohio stallion out of an Ohio-owned mare.  Currently, there are probably 60 of them in the entire state, and those horses are eligible for accredited races.  What I want to do is increase that number.”

Schmitz said that goal will be much easier to achieve once the VLT revenue starts flowing, giving tracks the ability to substantially increase purses.

“We’ve been racing for a baloney sandwich,” Schmitz said.  “Hopefully, we can upgrade to a cube steak or a porterhouse.”

There are already signs of progress in the state’s breeding industry.  The number of Thoroughbred broodmares registered in 2012 was 174, up from 113 in 2011.  Seventeen new stallions were registered in the state last year, and early in 2013, The Cliff’s Edge, who stood for eight seasons in Kentucky, relocated to Fair Winds Farm in Ohio.  There have also been increases in registered Standardbred mares and stallions.

But Schmitz acknowledges the shift into Ohio’s new “paradigm” will not be like flipping a switch.  It will take time, and it’s already clear the road will be bumpy.

Horsemen and the racetracks, most of which are owned by casino companies, still need to work out agreements on splitting VLT revenues.  The two sides also have differing visions when it comes to the racing calendar.

Chris McErlean, vice president of racing at Penn National Gaming, which owns Beulah Park and Raceway Park, said the company has approached horsemen about cutting race dates and restructuring the statewide schedule.

“Honestly, it was met with ‘we’ll do what we want to do’,” said McErlean. “I think that’s where an opportunity is being missed.  The racing model does need to change in terms of racing dates, and we haven’t gotten much response on that.”

Dave Basler, executive director of the Ohio Horsemen’s Benevolent & Protective Association, said horsemen have talked with PNG about racing dates, but the horsemen want a packaged deal that includes an appropriate number of stalls and dorm facilities at the proposed Youngstown track.  Basler said PNG is planning 500 stalls, while the horsemen want to keep their current level of 1,100.

“We said we will discuss an overall agreement with regards to the racing schedule and backside amenities,” Basler said.  “We’re not going to sign off on a cut in racing dates without the backside amenities.  Clearly, a 500-stall barn area will not work.”

The racing commission and the gaming companies are also tussling over the new facilities. In addition to the Penn National Gaming tracks being relocated, Churchill Downs and its partner Delaware North are moving Lebanon Raceway about 20 miles closer to I-75.  The racing commission wasn’t happy with plans for a 700-seat grandstand at the new venue, a figure Schmitz compared to the size of some county fair seating.

“We want to move the sport forward, not backward,” said Schmitz.  “Getting (casino companies) to devote more to the racing side, that’s our challenge.  We’re in the process of looking at their plans.”

McErlean said for PNG, it makes little sense to build a traditional racetrack when live racing attendance numbers don’t support that. Instead, the company wants to create integrated venues that better reflect the current market.

“We’re pleased with what we’re putting forth,” McErlean said.  “We have the benefit of starting from scratch, and we have a good plan for integrating the racing business customer and the gaming customer.”

The disagreements over scheduling and facilities are similar to those in other states where gaming revenues subsidize purses.  Track operators push for a leaner schedule to maximize the racing side, while horsemen fight for their opportunities to win.

Schmitz and the horsemen believe contraction, as a general strategy, makes little sense at a time when purses are about to take off.

“We want to encourage live racing,” said Schmitz.

“Unfortunately, horsemen and commissions, they look at racing dates as a benchmark for success,” McErlean said.  “If we can put on a good product and do well in racing and can make money in racing, we want to do it.  It’s tough in a lot of places, and from that standpoint, I think Ohio does have an opportunity to do some things and still offer a good product and benefit the horsemen.”

At recent Ohio Thoroughbred meets, field sizes have averaged between six and seven starters, while cards have averaged seven to eight races.  But horsemen see a different future in store.

“Field size will unquestionably go up in 2014 and beyond,” said Basler.  “A major part of the problem has been a purse structure that makes it pretty tough for a guy to sustain a business.  Trainers will just ship out to other states.”

Basler, head of the HBPA, said horsemen have had both positive and negative communications with track operators in discussions about Ohio’s future.

“Given the trends in the racino industry, we have to be concerned,” Basler said.  “Understandably, a publicly-traded company that operates a racetrack looks out for their bottom line first, but a balance needs to be struck.  To a large extent, the horsemen in the state of Ohio are reliant upon the racing commission and state legislators to maintain that balance to ensure the equine industry is protected going forward.”

For all involved, the early numbers from the state’s first racino, Scioto Downs, are encouraging.  While live handle fell 7.4% in Ohio last year, Scioto Downs saw a 26% increase in wagering.  The track also estimated that attendance was up 40% since the addition of VLTs last June.

“The way it’s set up, there’s a breezeway between the VLT operation and the racetrack, so people are migrating over to the racing side,” Schmitz said.

Schmitz believes the pieces will start to fall into place for Ohio’s Thoroughbred industry once the Thoroughbred tracks add VLTs.  Schmitz and Basler both hope funding can also be directed to welfare and safety initiatives, Thoroughbred retirement, and equine research among other things.

“This is an evolution. You can’t think of everything at once,” Schmitz said.  “Right now, the Thoroughbred industry has no cows in the barn.  It’ll take time.  The money’s not there now.”

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  • Herewego

    The number of racing dates in Ohio is set by law. As usual McErlean is completely full of BS.

    McErlean also fails to mention that Penn National’s plans for the backside at the new Youngstown facility call for only 500 stalls and no dorm rooms or other backside amenities such as a track kitchen. If Penn is not forced to change these plans racing at the new track will be crippled before it ever starts which very well may be Penn’s plan.

    • NAFTA

      Imagine the cognitive dissonance that Mr. McErlean must feel every two weeks when he collects a paycheck from a company that is determined to eventually weed out the division they have charged him to lead and represent.  All the way down through to the eventual abyss.
      Or maybe he doesn’t…

      • Herewego

        Well stated NAFTA.

  • Herewego

    The number of racing dates in Ohio is set by law. As usual McErlean is completely full of BS.

    McErlean also fails to mention that Penn National’s plans for the backside at the new Youngstown facility call for only 500 stalls and no dorm rooms or other backside amenities such as a track kitchen. If Penn is not forced to change these plans racing at the new track will be crippled before it ever starts which very well may be Penn’s plan.

  • NAFTA

    Imagine the cognitive dissonance that Mr. McErlean must feel every two weeks when he collects a paycheck from a company that is determined to eventually weed out the division they have charged him to lead and represent.  All the way down through to the eventual abyss.
    Or maybe he doesn’t…

  • Herewego

    Well stated NAFTA.

  • acr

    A thoroughbred track north of Dayton and one at Cinncinati and they could both work as ship in tracks….

    • Jeffrey

      Good grief. Ship in from where?

      Have you noticed the long-term decline in race days? Handle? The number of tracks?

      Have you noticed the abundance of short fields in nearly every venue?

  • acr

    A thoroughbred track north of Dayton and one at Cinncinati and they could both work as ship in tracks….

  • Ptrckj7777

    with all the natural gas and oil money from fracking ohio is going to be rolling in the dough and that means more gambling.if the race tracks put out a good product that is entertaining there very well could be a resurgence of horse racing in the state.

  • Ptrckj7777

    with all the natural gas and oil money from fracking ohio is going to be rolling in the dough and that means more gambling.if the race tracks put out a good product that is entertaining there very well could be a resurgence of horse racing in the state.

  • Milezinni

    Ohio, along with New Mexico (9,000+ already this year) is one of the worst offenders in the slaughter pipeline to Canada and Mexico! They think the solution to fixing Ohio racing is to breed MORE $2500 Claimers?!? The incompetence, and ignorance in this industry is astounding!! Just when I begin to hope things might be changing, and this industry will finally “get it”, I read stories like this one!?! Or the response from horseman in Ontario last week, or the Furosemide meeting in Cali 2 weeks ago, or the statements from horseman in FL this week, etc, etc…..I am losing all hope, and it my breaks my heart, but, if this keeps up much longer I will turn from a supporter of horse racing to one of its most staunch and tenacious detractors!! But no matter how they want to spin it, no matter how much money they make and waste I absolutely will NOT continue as long as they keep overbreeding, over medicating, over working and then over the border to the slaughter houses because its an easy financial solution. No matter how many times they try to convince me there is no other way I still know that it is 100% wrong that a single horse has to be slaughtered just because they broke it and it can’t race no more!! Not one!!

    • Have Faith

      Keep an eye on the NYBred Program……it has enticed some nice Kentucky Stallions to stand in N.Y…..The NY Breeders Program is generous to the Breeders and the purses (boosted by Casino $) have been generous to the owners….Maybe with a good Breeders program and better purses,  better horses will be bred in Ohio and racing will rebound. Worse case scenario, create more OHIO bred restricted races!……NY breds have won the derby and have been competitive…why can’t  OHIO breds  do the same in the future???

      • Jeffrey

        Better bet to keep an eye on the state government as they whittle down the subsidy from those “Casino $”.

        Owners / breeders have no legitimate claim to revenue from other forms of gaming.

        Racing in New York has been relevant for a long time and this supports a viable breeding industry. Who was the last NY-bred to win the Kentucky Derby? Funny Cide? Certainly not a product of slots money.

        When has racing in Ohio been relevant, other than the Ohio Derby, which is usually won by a shipper rather than a local campaigner?

        Ohio is a step below Pennsylvania and should use that as their point of reference, not New York.

        That is just the reality.

        • BigC

           There were more hot dog wrappers floating in the breeze than fans on Ohio Derby Day 2012.

  • Milezinni

    Ohio, along with New Mexico (9,000+ already this year) is one of the worst offenders in the slaughter pipeline to Canada and Mexico! They think the solution to fixing Ohio racing is to breed MORE $2500 Claimers?!? The incompetence, and ignorance in this industry is astounding!! Just when I begin to hope things might be changing, and this industry will finally “get it”, I read stories like this one!?! Or the response from horseman in Ontario last week, or the Furosemide meeting in Cali 2 weeks ago, or the statements from horseman in FL this week, etc, etc…..I am losing all hope, and it my breaks my heart, but, if this keeps up much longer I will turn from a supporter of horse racing to one of its most staunch and tenacious detractors!! But no matter how they want to spin it, no matter how much money they make and waste I absolutely will NOT continue as long as they keep overbreeding, over medicating, over working and then over the border to the slaughter houses because its an easy financial solution. No matter how many times they try to convince me there is no other way I still know that it is 100% wrong that a single horse has to be slaughtered just because they broke it and it can’t race no more!! Not one!!

  • Bill

    Too oversaturated.  6 race tracks really?  Let the thouroughs stay out west with the others and concentrate on the harness racing.  

  • Bill

    Too oversaturated.  6 race tracks really?  Let the thouroughs stay out west with the others and concentrate on the harness racing.  

  • Rz

    To the person commenting on “ignorance of people in horse racing” . You’re an idiot! I train horses in Ohio. I put my blood, sweat and tears(literally) into my job everyday. My horses eat better than i do, sleep better too on occasion. Thats true with the majority of the trainers i know. We rely on them to take care of us in return . If they are mistreated, how would we expect them to make $ ? As for them going to slaughter, 1st of all thoroughbreds arent the only breed going. Thanks to morons like you, ALL kinds of horses are forced to be shipped on LONG, suffering trips to Mexico & Canada because the US is too nice of country to kill horses. These same morons continue to eat porkchops and steak because those animals dont die a horrible death like horses right. Its also ok that millions of dogs and cats get euthanized every year right. Or that people are leaving there horses to starve to death cuz they can’t find them homes or send them to auction. You my friend need to be educated. Leave me your address & whenever there is an unwanted racehorse going to slaughter i will have it dropped off at your house!

    • Milezinni

      Thanks Rz, every time you ” horseman” open your mouths, you just keep proving my point and making my arguments for massive overhaul/contraction easier to prove….

    • Jeffrey

      The employment of ad hominem blurs whatever point it is you are trying to get across or make.

  • Rz

    To the person commenting on “ignorance of people in horse racing” . You’re an idiot! I train horses in Ohio. I put my blood, sweat and tears(literally) into my job everyday. My horses eat better than i do, sleep better too on occasion. Thats true with the majority of the trainers i know. We rely on them to take care of us in return . If they are mistreated, how would we expect them to make $ ? As for them going to slaughter, 1st of all thoroughbreds arent the only breed going. Thanks to morons like you, ALL kinds of horses are forced to be shipped on LONG, suffering trips to Mexico & Canada because the US is too nice of country to kill horses. These same morons continue to eat porkchops and steak because those animals dont die a horrible death like horses right. Its also ok that millions of dogs and cats get euthanized every year right. Or that people are leaving there horses to starve to death cuz they can’t find them homes or send them to auction. You my friend need to be educated. Leave me your address & whenever there is an unwanted racehorse going to slaughter i will have it dropped off at your house!

  • Milezinni

    Thanks Rz, every time you ” horseman” open your mouths, you just keep proving my point and making my arguments for massive overhaul/contraction easier to prove….

  • Jeffrey

    This will be like watching a train wreck in slow motion.

    Is Mr. Schmitz BLIND to the debacle that racing / breeding in Pennsylvania is fast becoming, if not already there?

    As in Pennsylvania the band-aid of subsidies from other forms of gaming will slowly be peeled back until the band-aid is gone and the industry will be back where it started: circling the drain.

    A confederacy of dunces if ever there was one.

  • Jeffrey

    This will be like watching a train wreck in slow motion.

    Is Mr. Schmitz BLIND to the debacle that racing / breeding in Pennsylvania is fast becoming, if not already there?

    As in Pennsylvania the band-aid of subsidies from other forms of gaming will slowly be peeled back until the band-aid is gone and the industry will be back where it started: circling the drain.

    A confederacy of dunces if ever there was one.

  • Jeffrey

    The employment of ad hominem blurs whatever point it is you are trying to get across or make.

  • Jeffrey

    Good grief. Ship in from where?

    Have you noticed the long-term decline in race days? Handle? The number of tracks?

    Have you noticed the abundance of short fields in nearly every venue?

  • Have Faith

    Keep an eye on the NYBred Program……it has enticed some nice Kentucky Stallions to stand in N.Y…..The NY Breeders Program is generous to the Breeders and the purses (boosted by Casino $) have been generous to the owners….Maybe with a good Breeders program and better purses,  better horses will be bred in Ohio and racing will rebound. Worse case scenario, create more OHIO bred restricted races!……NY breds have won the derby and have been competitive…why can’t  OHIO breds  do the same in the future???

  • Jeffrey

    Better bet to keep an eye on the state government as they whittle down the subsidy from those “Casino $”.

    Owners / breeders have no legitimate claim to revenue from other forms of gaming.

    Racing in New York has been relevant for a long time and this supports a viable breeding industry. Who was the last NY-bred to win the Kentucky Derby? Funny Cide? Certainly not a product of slots money.

    When has racing in Ohio been relevant, other than the Ohio Derby, which is usually won by a shipper rather than a local campaigner?

    Ohio is a step below Pennsylvania and should use that as their point of reference, not New York.

    That is just the reality.

  • BigC

     There were more hot dog wrappers floating in the breeze than fans on Ohio Derby Day 2012.

  • G_justice

    I think it,s a bad deal for the horseman to move beulah park just because of big money deals going on behind close doors

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