Plans To Save Racing

Published: June 26, 2012 10:55 pm EDT

The Ontario government has passed their budget and have remained steadfast in their position that the slots at racetracks program as it now exists is over as of March 31. Faced with the facts as they stand right now, we must present a well thought out, common sense plan to the government that will preserve the horse racing industry in Ontario.

I believe that over the last few months we as a group led by OHRIA have made our case very well to the government as to the magnitude and importance of our industry. Anna Meyers' submission on behalf of SBOA was particularly thorough and compelling. Recently, Woodbine's CEO Nick Eaves released an excellent statement explaining the merits of the partnership between WEG and OLG and the history behind it. He also laid it on the line how devastating it would be for our industry unless a new arrangement is made. Also, former Liberal MP Dennis Mills is spearheading a fantastic campaign through RACING FUTURE that is getting our message out to the public and the government. I am certain that this government is getting the message that they have underestimated the importance of the horse racing industry in Ontario and realize that mistakes have been made. I have to believe that there is a desire in the government to do something substantial to preserve the industry.

Industry groups are now meeting with a three-member panel appointed by the government to discuss how government funds should be used. Meeting with this panel along with Mr. Sadinsky's efforts to talk with government officials is our best opportunity to put forth a plan to save the industry. Included here are two proposals, one by Brian Webster regarding the entire industry and one by Dave Briggs dealing with breeders and the OSS. Both plans are impressive and well thought out and I think in combination would make an excellent package to put forth to the government. Of course any proposals should be presented by OHRIA as they represent our entire industry. These proposals will be sent to OHRIA for their consideration and I urge anyone else that has ideas to do the same.


A Plan For The Future For Ontario Harness Racing - by Brian Webster

After speaking to hundreds of concerned people in the Standardbred industry over the past few months it is time to deal with what is possible and come up with specific ideas for moving forward.

This plan is simple in its concept but realistic. Most of us have accepted that we will have a smaller, changed industry going forward. The starting point for the future is to determine which tracks will continue to hold races (with comparable purses to the present) past March of next year. Because of historical ties, agricultural components and tax issues we should be able to count on six tracks; namely, Clinton, Grand River, Hanover, Mohawk, Western Fair And Woodbine that intend to race. If there were other for profit tracks who would join this group that would be great, all they would have to do is commit to support future racing at a level comparable to what we have now.

The one parameter that must be in place in order to continue is that the aforementioned tracks would need to be confirmed by OLG as the designated gaming operation for their respective zone. Once this is in place each track organization would have to negotiate a realistic agreement for revenue sharing with OLG.

Would such a plan be acceptable to the people who own, train and race? Yes, most everyone is ready for a solution to this debacle to be considered and this plan would conceptually be accepted by a majority of participants. A scenario where we would have six tracks including our flagship pair conducting races with comparable purses to the level we now have would be a workable base. In New York there are seven tracks, in Pennsylvania there are three, in Ohio there are four. All trainers, drivers and owners presently racing now would be eligible to race in this new dynamic.

Where do the breeders fit in? The OSS is the jewel in our crown. As long as it can be funded in a similar manner as now exists the majority of breeders will be supportive. The program will need to be reconfigured with only six tracks participating but that can be easily done.

Here are the main obstacles to overcome:

1. The tracks must be able to negotiate a satisfactory agreement with OLG. If this can't be done it is over. After turning our customers from horse players to machine players there is no track that can survive at a decent level without slots. Harness racing will survive but as a hobby not a business.

2. It will take time for the tracks to finalize an agreement with OLG but the breeders cannot wait. Their business involves long term planning, therefore, significant funds will be required starting in 2013 in order to have stability as the plan comes together.


Stable funding for Ontario Sires Stakes program the way to go - Dave Briggs, April 25, 2012

In exchange for supporting the Liberals’ provincial budget, NDP Leader Andrea Horwath allegedly received a commitment for some “transitional aid” for Ontario’s beleaguered horse racing industry which considers Guelph its nucleus. Details are scarce, but indications are a one-time payment may, eventually, be headed to the industry to offset the financial devastation caused by the Liberals’ decision to end the slots-at-racetracks program in March of next year.

I have an idea how best that money could be spent, but first some background.

The Liberals have faced withering criticism from mainstream media outlets across the province for an obvious ignorance of how the horse racing industry works, how much it contributes to the economy as Ontario’s second largest agricultural sector (some $2 billion a year) and how many people it employs (60,000).

Particularly troubling is the immediate, crippling impact that cancelling the slot deal has had on the province’s horse breeders. A minimum of three years is needed for a breeder to see a return on investment. An uncertain future beyond March of next year has caused the value of Ontario-bred horses to plummet and has decreased the number of horses to be bred for future years.

Yet, in light of a vague promise to help the industry, there’s a way the Liberals can save some face after bungling the horse racing file. In turn the industry, and those with the biggest investment in it, can avoid extinction.

Please, let’s not try to retrain racing’s largely unskilled labour force through Ontario Works or some other body yet to be created. That’s a waste of time and money. Instead, the best way to help the most people in the industry is to use much of the “transition aid” to secure long-term, stable funding for the Ontario Sires Stakes program which has existed for 38 years.

The program has elevated the Ontario-bred harness horse to world-class status. Estimates are that about half of the program’s $20 million in annual funding comes from slot machine revenue (the other half, essentially, comes from betting on horse racing).

That means in a year’s time, once the government turns off the slot machine tap, there’s likely to be approximately a $10-million shortfall in funding for the Sires Stakes to keep it near its current level of funding. Currently, horse racing’s 20 per cent share of slot machine revenue amounts to about $345 million a year. For less than half of that, a one-time payment of $150 million could, essentially, fund the Sires Stakes program to the tune of $25 million annually for a decade. An ironclad 10-year agreement, with no out clauses, would provide considerable stability to a labour-intensive industry.

While $150 million is a lot of money, it basically would be the equivalent of stretching the industry’s share of slot revenue six months longer than planned. That would preserve the value of Ontario-bred horses already produced but yet to sell as yearlings this fall, helping breeders to avoid taking a bath at the auctions. It would also mean breeders that upgraded stock in recent years would be able to recoup at least some of that investment. For those who do the racing, it would keep horses in the barn and people working.

In exchange for that one-time aid package, the industry should be required to commit to a concrete plan for funding the Sires Stakes after the aid has dried up in order to preserve the sport and the Ontario breed beyond the next decade.

The sad reality is that without slots there will be fewer Ontario racetracks, fewer race dates and, likely, lower overnight purses, which will drive many of the smallest operations out of the business. Yet, strong funding for the Ontario Sires Stakes would keep a proud, thriving business alive and allow the Liberals to claim it drove the agricultural economy at home and tightened racing’s belt without asphyxiating the game.

It’s the least they could do.


The most urgent issue right now is to secure funding for the OSS before the yearling sales start this fall. Without this, the sales will be a disaster with devastating financial consequences for the breeders and the entire horse racing industry. Previous governments in Ontario as well as many states south of the border have seen the wisdom in promoting sires stakes programs. We have to re-educate our government about the benefits of having a strong program including the large number of jobs it creates along with the tremendous economic effect it has.

It is the nature of our business that any money that is earned is put right back into the economy which is what this province needs. Dave's 10 year plan would be great as it would allow everyone to make long range commitments which is always stimulative to the economy but we will have to see what financial commitments this government is willing to make. Even a five year plan that could be renewed would save the industry and give breeders and racing participants time to adjust to a smaller industry. One thing that we all have to remember is that once the dust settles we are going to have a much smaller industry and we will have to adjust to that.

A big problem has been that some racetrack owners [and we all know who they are] have taken in huge amounts of money from the slots at racetracks program and have put almost nothing back into the racetrack facilities or promotions. To me, this has been the one big failing of the slots at racetracks program. There is no doubt that horse racing needed some adjustments and improvements but I just can't believe that a rational government would be willing to destroy it instead of improving it. Hopefully after having informative face to face talks with government leaders that understand the racing business we can come out of this in reasonable shape.

Jack

Have something to say about this? Log in or create an account to post a comment.