The Breeders’ Cup Forum: California Racing and Hollywood Park

by | 04.28.2011 | 6:42am
Martin Panza

As racing secretary and vice president of racing for Hollywood Park, Martin Panza is on the front line of California racing's battle to adapt to a changing environment of fewer owners and horses and increased competition from other racing states. The good news is that Panza is armed with lucrative, rising purses, the highest in the track's history.

Panza was named Hollywood Park's racing secretary in 1994.  He also serves as North American representative for the Dubai Racing Club, is a member of the North American Ratings Committee, served on the American Graded Stakes Committee and chaired a committee of racing secretaries whose work led to the expansion of the Breeders' Cup championships in 2008.

California racing is getting beaten up over a lot of issues (takeout increase, short fields, bad injury rate at Santa Anita's meeting).  Tell me a few things that are right with California racing?
From a horsemen's standpoint there are several positives about racing in California.

California is the only state to offer two year-round racing circuits. Whether a trainer is based in Northern California or Southern California they never have to move their operations to the extreme that a trainer back East may face. Stabling in California is free, which can be a significant savings for owners. Horse transportation from auxiliary training centers on race day is also complimentary. California still offers a large amount of graded stakes race opportunities.

Speaking for Hollywood Park, the overnight purse structure is at the highest level ever. The purse levels at Del Mar this summer will be outstanding. The weather in Southern California allows for turf racing throughout the year. The condition book, which dictates the racing product, is uniform and consistent from meet to meet on a year-round basis with an emphasis on trying to use the races that are offered in the book.

We are fortunate to have both TVG and HRTV based in Southern California, which probably gives us some sort of home field advantage on the media front.

Being under the spotlight all of the time makes you address the issues; some are easily fixed, while others will take time.

What are you proudest of in terms of the accomplishments under your tenure at Hollywood Park?
The creation of the American Oaks will always be close to my heart. It was one of the few American races that could attract horses from Japan and Europe on a yearly basis. More importantly, it strengthened my belief that racing can prosper if given the proper resources in the right environment and the courage to try something new.

The creation of the Breeders' Cup Marathon and some of the marathon dirt races now available in the United States came about through a series of meetings amongst various racing secretaries. Fortunately, Mr. (Greg) Avioli, Mr. (Bill) Farish and Mr. (R.D.) Hubbard, along with the rest of the Breeders' Cup board, were willing to take a chance in anchoring that pattern of races with the BC Marathon.

The first guaranteed wagering pool in the United States. The first few guaranteed $1,000,000 pick six pools at Hollywood Park were a lot of fun, I think they got into the $3,000,000 range. I give Mr. Hubbard and Keith Chamblin, then Director of Marketing, credit for taking the chance. As a result, there are guaranteed pools all over the country now.

Hollywood Park, several years ago, began offering a starter race “for horses which broke their maiden for $40,000 or less and had not won two races” — sort of a one other than allowance race for the winner of a maiden claiming race. In one fashion or another, this type of race has spread to a few tracks across the country.

From your perspective, what are the biggest challenges racing in California faces right now?
Leadership. It is not that we are lacking leadership; we just need to all get on the same page and move in the same direction if possible. You have three major racetracks in Southern California run by three different management groups; add the TOC, the CTT and the CHRB. That is a lot of opinions in trying to form a consensus. A lot of different agendas.

My opinion, since you ask:  Hollywood Park is not going anywhere for several years because of the downturn in the economy and the real estate market. Instead of focusing on closing Hollywood Park down as soon as possible and giving the dates to Santa Anita, we should be working as a group to develop a “game changer” for racing in California. I can't think of many tracks that run 10 months a year and can offer a desirable product on a continual basis. Giving any one track that many dates puts everyone else at the mercy of that track; way too much power for any one group to have.

The business of owning racetracks in California does not make economic sense regardless of the number of days you run. It is like the house is on fire and we are fighting about who gets to sleep in the master bedroom! We need to stop fighting over table scraps and start working together.

Hopefully as Santa Anita comes under private ownership, along with the hiring of Greg Avioli, the Stronach racing enterprise will get more engaged in California. California is a sleeping giant. We need to find a way to take advantage of the environment we operate within with its massive population and the sheer size of the local economies.

What is the Southern California horse population now compared to where it was about five years ago?
The horse population has dropped from well over 4,000 horses down to a low of around 2,400 over the last few years. There are encouraging signs in the last few months as several trainers have begun to increase their numbers. Numbers are for accountants though; they can go up and/or down and only tell part of the story. People such as Bobby Frankel or John Mabee, as examples, are hard to replace.

How much of that drop is due to the decline of California's breeding program?
There is no doubt that the number of horses that are produced each year in California is on the decline, the same could be said for most states in the country. I am not sure that we have felt that pain yet. Plus with two circuits running year round, things could get even more difficult down the road.

The CTBA recently started a bonus program for Cal-bred maiden allowance winners. A $20,000 bonus is paid to the owner of any Cal bred that wins a maiden allowance in Southern California or $10,000 in Northern California.

For example:
Current Cal Bred Maiden Allowance purse at Hollywood Park is $50,000, with 60 % to the winner, $30,000 (minus jock/trainer fees, $24,000.

–CTBA bonus check, $20,000, a total $44,000.
–Breeder award if owner/breeder (12%), $6,000, a total of $50,000.
–Stallion award if stallion owner (14%), $7,000, a total of $57,000
If an open maiden race 30% more on win, $8,000, a total of $65,000.

Since the inception we have seen an increase in the number of Cal-bred maiden allowance races offered and an increase in field size for those races. As the foal crop does declines it will mean fewer horses competing for over $30 million in Cal-bred monies.

Is it fair to say the shortage so far is really owners, not horses?
If the sport can make some economic sense for owners once again, then they will come back. As the demand increases for horses then so will the supply. Unfortunately there will be a lag time of two to three years due to the horse production cycle.

There is a perception that California trainers don't run their horses as often as trainers in other parts of the country do. Fair or unfair?
Through statistics from Equibase we know that our horses have several more workouts in California than in most other racing jurisdictions. Why that is I am not sure. I think some trainers feel comfortable running certain horses often and some prefer to be more selective. In choosing a trainer I would suggest owners put some research into each trainer's philosophy on this subject.

I don't think any trainer has horses ready to run and just is not entering. This economy probably will weed out the non-participants, as owners will increasingly not stand for it.

The increase in takeout on certain bets helped raise purses, but it looks as though it led to decreased handle. Have the purse increases had any measurable effect on owning horses, or is it too soon to tell?
Without a doubt we are beginning to see some trainers pick up more horses. It takes time but there is some light at the end of the tunnel despite all of the forces working against us. With higher purses the trainers now have a chance to recruit new owners or pick up new horses for existing owners. I would not want to imagine what the horse inventory would be like today without the purse increase.

Who would have guessed that Jerry Jamgotchian would have sent a string of horses to Santa Anita this winter!

As I stated earlier in the article, racing can prosper if given the right resources in the proper environment.

What options are there to offer a better product for horseplayers and still remain a financially viable industry for tracks, horse owners and industry employees?
In California, racetracks are going to have to walk a fine line with regards to the number of races offered in direct correlation to the active horse inventory. If one track over-uses the population if will have serious consequences for the next track.

What is better product? Is it higher field size? Who would have guessed 10 years ago that Belmont Park would be offering maiden claiming $25,000 races on the turf and they seem to handle well! I am not knocking NYRA but it shows you how much the game is changing. It is human nature to look back on times gone by and wish they could return.

In California, we are just beginning to expand our satellite/OTB outlets to try and expose the game to new patrons. I think Rick Baedeker has been put in charge of trying to help expand that network. In turn it should mean more purse money and some growth for the industry in areas where racing has not had a presence. I am envious of the whole New York OTB system, while I understand the financial woes, it has helped to make racing relevant throughout that state.

In this economy most of our fans probably can't afford to put money on account with an ADW provider and leave it there so the development of mini-OTBs should be beneficial. Racing is meant to be a social event, people want to brag about their latest winner, drink a few beers with their friends, check out the scenery, get out of the house for the day.

Hollywood Park, along with Dr. Allred at Los Alamitos Race Course, has begun to offer Monday and Tuesday dark day simulcasting in the Los Angeles area, which should help with the growth of the mini-satellites/OTBs while generating some additional purse money.

Owners can be helped by higher purses, and the races in the condition book going.

Industry employees are looking for job stability which correlates directly to the financial stability of the track at which they are employed.

Tracks will need to find new revenue streams wherever they may be available. In California I think it will need to be a “Game Changer” as stated earlier.

Are we approaching the point where California can no longer support two year-round racing circuits?
I think it is very important that Northern California/Golden Gate Fields survives. As an industry in California we need to do all we can to ensure their survival. We are very isolated on the West Coast and Northern California racing gives our horsemen another option.

Golden Gate Fields inherited the Bay Meadows race dates and I don't believe that has been a financial boom for the track. Sort of proving an earlier point, that shutting down Hollywood Park and giving the dates to Santa Anita will not resolve any of the core problems that the industry in California faces; it only further narrows our options.

If Southern California can get healthy from a horse population standpoint through higher purses, then eventually some of those horses will make their way to the northern California circuit.

Is three-day-a-week racing or weekends only on the horizon?

I don't think three-day race weeks are viable. There will not be enough opportunities for jockeys, owners or trainers unless there can be massive purse increases on the level of Hong Kong or Japan.

Most of our employees are working four days a week now and trying to survive. I would rather see fewer races run each day than the further reduction of racing days.

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