The Implementation and Monitoring (IM) Group of the Ontario Racing Program (ORP) has received an application from Woodbine Entertainment Group (WEG) to continue racing four days a week when WEG moves to Mohawk for its summer meet

.

The current approved 2012 race date schedule for Mohawk includes a move to five days a week. The WEG application to vary the Mohawk schedule proposes to remove 17 race days (Tuesdays) from the schedule.

A copy of the application is attached to this Notice. The decision on this application will be made by the Director. Before formulating its recommendation to the Director, the IM Group is seeking public consultations regarding this reduction of approved race dates at Mohawk Racetrack.

Input, comments or concerns regarding this request must be received by Friday May 18, 2012 to be considered. Your submissions should be forwarded to the attention of the IM Group, as follows:

Attention: 2012 Reduction of Race Dates for Woodbine Entertainment Group – Public Comment
Email: [email protected]
Facsimile: (416) 213-0520

May 15, 2012

Wendy Hoogeveen
Director of Industry Development and Support
Ontario Racing Commission
Suite 400
10 Carlson Court
Toronto, ON
M9W 6L2

Re: Request for Variance to Mohawk 2012 Live Date Schedule

The Woodbine Entertainment Group (WEG) requests a variance to the 2012 Mohawk live race date schedule. The request is to maintain the current live standardbred date schedule being conducted at Woodbine Racetrack; Monday, Thursday, Friday, and Saturday evenings. The result of the variance, if approved, would be the deletion of 17 Tuesday evening race cards. Sunday evening race cards scheduled for May 20 and July1 would be conducted as scheduled.

On a total pool basis, the Woodbine 2012 Standardbred meet has exceeded expectations. Total pool wagering (through May 5) of $106,202,800 is up 12.33% from the same period in 2011 (Fig. 1). The average total pool wager per race year to date is $125,699, an increase of 7.03% from 2011. The 2012 meet is averaging 11.9 races per card or 47.6 races per week, versus 11.5 races per card in 201 1 (Fig. 2). The average total pool wager per card is $1,495,814, an increase of 10.8% from 2011. In our view, maintaining a 12 race card schedule has been critical to realizing total pool wagering growth.

The 2011 Mohawk meet, a 5 day per week schedule, averaged 11.24 races per card, a total of 1,090 races over the 98 card meet, or an average of 56.2 races per week (Fig. 3). In 2011, the average total pool wager per card was $1,284,883, or $114,343 per race. On the 18 Tuesday evening cards conducted, the average total pool handle per race was $95,748, or $1,026,634 per card (Fig. 4). The Tuesday race cards averaged 10.72 races per card in 2011.

In discussions with the IM Group, it was confirmed that horse supply generally is down in Ontario for 2012. When asked on the expectations of horse supply for the Mohawk meet compared to last year, the view was that horse supply could be the same, or probably worse. With that, yet assuming the same level of horse supply this year as in 2011 for the Mohawk meet, maintaining a 12 race card on the current schedule of 4 days per week would leave an average of 8 races per Tuesday card. WEG has been approved for 13 race cards. Carding 13 race cards, in the weeks supply warrants, could increase the number of races conducted in a 4 day per week schedule to 52, 4 less than the 2011 meet average.

A secondary concern, primarily as a result of the cancellation of the Slots at Racetracks Program, is the status of the standardbred purse account at WEG (Fig. 5). WEG ended 2011 $4.86 million underpaid to purses. The full effect of purse increases implemented during 2011, improvements to the Winter/Spring series' at Woodbine and Mohawk, and the late edition of the 2012 Breeders Crown is projected to result in an overpayment to purses of $4.19 million for calendar 2012. The resulting year end projection for the purse account is an underpayment to purses of $674,493. Slot purse contribution was expected to improve in 2013, as the current renovation of the slot floor undertaken by the OLG should conclude in December of 2012, with the full effect of 3,000 slots on a renovated floor adding to the revenue to purses from slots. With the cancellation of the program, and the uncertainty the announcement has created, it would be prudent to end 2012 with an improved position as opposed to the current forecast.

If a 12 races per card, 4 cards per week for a total of 48 races per week schedule is maintained through the Mohawk meet (with the exception of the two holiday Sunday cards), based on experience in 2011 the reduction of races would be 145 (Fig. 6). The reduction in purses paid for that number of races would be $2,795,603. Added 13 race cards would reduce that amount accordingly. The lost purse commissions as a result of reduced wagering for the projected number of races would be approximately $300,000, and again would be reduced with any added 13 race cards. While the purse of any race conducted at WEG is not fully paid by wagering commissions alone, races conducted during Monday, Thursday, Friday and Saturday cards make a far greater wagering contribution than those conducted on Tuesdays, emphasizing the importance of filling the 4 main cards first before considering the 5th day.

WEG would not proceed with this application without the support of horsepeople that race at Woodbine and Mohawk Racetracks. The Central Ontario Standardbred Association (COSA) Board is in support of the concept of maintaining the successful 4 day per week schedule through the Mohawk meet. Further, COSA conducted a vote of its voting members with 89% voting in support of the 4 day per week schedule continuing at Mohawk (154-19).

In respect to Policy Directive 3-2007;

1. Customer satisfaction and demand for the product. As the Woodbine meet has shown, there is demand for WEG product as long as horse supply is adequate to meet the requirements of a Premier race card. As outlined, the product available for Tuesday race cards would not meet the satisfaction of our customer.

2. Adequate purse levels. Purse levels are adequate to provide incentive to horse owners to supply a 4 day per week schedule. With the current uncertainty, an overall purse reduction would be required if the Mohawk meet were to continue as currently approved. Such a purse reduction will ultimately reduce that incentive and reduce available horse supply.

3. Racing opportunities and available horse supply. Based on 2011 results, horse supply will not meet the requirements of a successful Mohawk meet based on the currently approved schedule. COSA, its board and through a vote of its members, provide horsepeoples' support that racing opportunities will be adequate with the proposed variance, and WEG is prepared to mediate race opportunity issues with added races or even added cards if required.

Other indicators in the Policy Directive are not relative to this application.

The proposed application for variance to the Mohawk live race date schedule is consistent with the intents of the Ontario Racing Program. An objective of the Program is a strong and successful Premier racetrack, that being Mohawk Racetrack. The Program took some steps that helped improve horse supply at the current Woodbine standardbred meet. Similar steps, such a reduction in race dates at Signature racetracks, would be required. Such steps are not being requested. The best option to maintain racing at the Premier level is to make the changes to the Mohawk meet as requested and supported by both the racetrack operator and the horsepeople who race at the track.

Please call if you have questions or concerns,

Regards,
Jamie Martin
VP Racing
Woodbine Entertainment Group

(ORC)