27 February 2012

Ontario Liberals Spewing Lies and Half Truths

The Ontario Liberals have now gone over the line in trashing Ontario horse racing and the revenue sharing slots deal that racetracks have at this time.

On the weekend they launched a couple of radio ads.
Text of Ontario Liberal Party Radio Ads

Radio Ad One:
“Did you know that Tim Hudak’s PCs started a secret subsidy for a few, very wealthy racetrack owners? And now in these times of restraint, Tim Hudak says these rich payouts should be protected. He’d cancel full day kindergarden, leaving 50,000 four and five year olds stranded. Are we really going to spend more on horse racing than full day kindergarden? The PCs should do what’s right. Tell Tim Hudak his priorities aren’t your priorities.”

Radio Ad Two:

“Did you know that Tim Hudak’s PCs started a secret subsidy for a few, very wealthy racetrack owners? And now in these times of restraint, Tim Hudak says these rich payouts should be protected. But when it comes to our seniors, he voted against new supports to help them stay in their homes longer. Are we really going to protect horse racing over our parents and grandparents? The PCs should do what’s right. Tell Tim Hudak his priorities aren’t your priorities.”

To actually hear the ads, click here and scroll down.

This is repugnant and slimy politics at its worst. Secret subsidy? For a few wealthy racetrack owners? This is just complete crap. I know politics gets dirty, but resorting to blatant lies to make ones case means that the case might just be very flimsy. I believe that this propaganda campaign launched against horse racing in order to break a deal that has benefited everyone except addicted gamblers is way off base. Also, this is not about tax dollars but after tax dollars earned in a business that governments shouldn't even be in, in the first place.

First off, lets address the secret subsidy for a few wealthy track owners claim. Here are the documented words of David Willmot in 2001 which pretty much explains the origins of the slots deal. Also of note, Woodbine Entertainment is a nonprofit organization (they reinvest their profits), and they account for making close to 50% of the revenues from slots in all of Ontario:

"How we got the slots is that the government was looking around for new sources of revenue, possibly through expanded gaming. Fortunately, we convinced them (and they knew, anyway, from their constituents) that slots in bars and restaurants is a terrible social idea. It is just too “in your face” for the average public. They were also looking at the idea of 44 charity casinos around the Province of Ontario, but reaction from people was the same; “We don’t want 44 charity casinos.” The charity casinos were to be mini-casinos since they were talking about 450 slots and 60tables. That would have been a new intrusion of gaming into many neighborhoods and it was very skeptically looked upon. We took that opportunity to work with government, and we said, “If you put the slots at racetracks, and don’t go with the 44 charity casinos, we can provide you with 70-80 percent of the revenue you were projecting from your total expansion, but we can do so in a socially responsible way in a location where there has been regulated gaming for decades.” We were talking, basically, of destination locations. People have to make a conscious decision to travel to the racetrack to gamble.So, this was a politically safe and socially responsible way for government to expand gaming, and, at the same time, because they were focused on creation and preservation of jobs, to help regenerate a very large agribusiness."

It doesn't sound like a subsidy to me, but a business partnership that benefited both the government and the racing industry. One could even argue that racetracks agreed to receiving too small a percentage.

The reason I state that the percentage may be too small is that this same Ontario government that is now calling the slots agreement a subsidy is venturing out to get into online gambling. They, through the OLG, recently closed an RFP (Request for Proposals) in order to choose a PARTNER that has experience in online gambling.

So lets get the crystal ball out. 2 years from now, the government, still looking at a huge deficit, realizes that there was 1.5 billion in revenue earned from their online sites. However, half a billion stayed with the company that set the whole thing up. How, possibly could the government then call that money a subsidy to the other company? They can't. They would be laughed at. But if you buy into the Liberal propaganda right now, isn't that money they pay the internet company (which will mostly be profits for that company), money that could have gone to all day kindergarten or health care?

This is a disgusting campaign by the Ontario Liberals (it should be noted that Federal Liberal Party has all but marginalized themselves out of the political scene in Canada of late).

It is also seemingly unworkable and if pursued it could get uglier and possibly have illegal ramifications.

Though it is hard to speculate on exactly what these snakes have up their sleeves (OK, snakes don't have arms, but you get my drift), however, I don't see how their plan can work other, than stealing a small percentage of what the current arrangement is.

Logistically, they can't demand that slots stay open, if the track owners get a smaller cut or no cut at all, as the government are only renters.

A government cutting back on spending, isn't about to outlay cash to build new casinos on government property. And a government that is receiving over a billion dollars from slots, isn't about to cut off the source of their revenue....anywhere.

So what are their choices? Partner up with large casino companies (who will wind up receiving a lot more than 20% of revenues) and have them finance new casinos? Doesn't sound like a smart move or one that will increase their bottom line one iota.

Buy out at least some of the tracks? These buyouts generally are at high premiums (they have to be, so it doesn't appear that the government took advantage of a situation that they are creating). Payback from such a buyout will take a decade to recoup. It doesn't fix the current deficit problem at all. The last thing the government needs to do is make bad buys as slot revenues are destined to drop from here on in, if internet slots becomes a reality in the near future.

It may come down to track owners telling the government to get off the property, if the new slots deal is too low. And the government needs to watch itself that they don't put a track into a fire sale position, and then buy out the track. That has lawsuits written all over it. And again, the government is not in a position to close down one slots location as there is no guarantee they will make up the lost revenue at another location.

Finally, the Liberals are shooting themselves in the foot through lies and propaganda. In the internet age, the truth generally wins out. If they keep this nonsense up, they will be the next marginalized political party in Canada.

An online petition was started on Friday, and it has over 5,000 signatures. If you haven't signed it, what is wrong with you?

The Thoroughblog also touches on the scummy tactics used by the Liberal government. Check out the promises McGuinty made to the horse racing community when he was begging for votes.

Tim Hudak (the Conservative Party leader) and the NDP both promised to keep things status quo with respect to the slots agreement. Now that Ontario has a minority government, it will be very telling if either party backs down on their stance.

18 February 2012

Looking At Slots At Tracks In Ontario

Here are some stats.  Except for 2012 race dates, the numbers are from the OLG's website for the dates of April 1, 2010 to March 31, 2011.  The first number is the total revenue (money lost at the casino by gamblers) in millions.  Next are the 2012 race dates for that track, followed by what the track gets in millions, what the horsemen get in millions, followed by what the OLG employees get in millions, and finally, the amount of OLG employees at that track's casino:
·        Ajax 168.6 40 16.9 5.1* 14.7 332
·        Clinton 12.3 19 1.2 1.2 4.4 92
·        Dresden 13.3 23 1.3 1.3 4.6 87
·        Flamboro 120.8 188 12.1 12.1 11.0 223
·        Fort Erie 29.8 81  5.3** 3.0 12.0*** 225***
·        Georgian 127.0 103 12.7 12.7 14.3 328
·        Grand River 43.7 65 4.4 4.4 7.2 161
·        Hanover 22.2 30 2.2 2.2 4.8 97
·        Hiawatha 29.6 44 3.0 3.0  7.4 140
·        Kawartha 65.9 96 6.6 6.6 9.1 177
·        Mohawk 153.6 98 15.4 15.4 11.9 240
·        Rideau-Carleton 142.3 159 14.2 14.2 13.9 268
·        Sudbury 49.4 62 4.9 4.9 8.0 148
·        Western Fair 101.8 123 10.2 10.2 14.4 330
·        Windsor 41.1 88 4.1 4.1 10.5 211
·        Woodbine 588.4 297**** 58.8 58.8 32.7 715
·        Woodstock 24.6 23 2.5 2.5 4.7 91
    * Ajax horsemen do not get 10% of the revenues (why?  Not sure)  ** Fort Erie racetrack receives more than the 10% from slots (that higher amount is a subsidized amount to stay alive)  ***Fort Erie seems to have an exceptionally high slots payroll compared to other tracks (this doesn't appear very efficient), the same is true for the amount employed by the OLG in Fort Erie.  This makes Fort Erie the least profitable track for the government of all racetracks.  ****Woodbine race dates include both thoroughbred and harness.
    Now, let me attempt to clear up some misconceptions that seem to be out there.  One question that seems to be out there is who owns the slots:  The building is renovated by the track owner. OLG is provided a "base building" area to build out their slot facility. They do everything from the carpets to the fixtures to the slots to the paint, etc. Think of it as an unfinished basement that they get to move in and finish.

 The arrangement between tracks and the OLG with regard to slots is definitely profit sharing.  Even in OLG documents, the OLG refers to the amount tracks and horsemen receive as "revenue" not "subsidies."   The only exception would be the additional amount Fort Erie receives (this is due to run out at the end of this year, and if not renewed, Fort Erie will most likely be toast even if the government were to forget about the Drummond Report suggestions.

     Historically, this slots deal was win win for both tracks and the government.  The government of Ontario was convinced that it could raise their revenues by bringing in one armed bandits into Ontario.  By locating the slots at racetracks took care of a lot of image problems the government would have faced if they were to put slots in stand alone facilities (it would be like building crack houses, a very tough sell).  
      Racetrack locations made a lot of sense.  This is where people came to bet anyway.  Tracks for the most part were accepted as legitimate gambling businesses by the people of Ontario.  This was worth something to the tracks, and still is.  So is the lost revenue that slots takes away from the core business of the tracks.  Over the years, horse racing has lost many fans to alternative forms of gambling.  No, they shouldn't be compensated for most of that, however, the government got into the slots business for two reasons, and one was to help the horse racing industry.  Slots took away many horse racing customers, who were still losing their money at the same location they used to, just in a different room.
      This actually hurt racing's growth potential even more, as dummy money (slot players are the least sophisticated of all the gamblers) shifted from horses to slots, making it a lot more difficult for core Horseplayers to keep their bankrolls going.  Many left to more price sensitive games like poker, blackjack, sports betting, and exchange wagering.  Now, racetracks and Horsemen are also to blame, as they were making more money bottom line thanks to slots, they forgot about their core business.  They kept track takeout extremely high (Ontario harness tracks have notoriously high WPS takeouts, while Fort Erie has ridiculously high double and exactor takeouts, for example), while tracks also created more high takeout pools.   
     There is a question as to why a government should be involved in gambling.  I realize many states and provinces have state and provincial lotteries, but is that really what governments should be doing?  Shouldn't their role be collecting taxes (cigarette taxes, HST, provincial taxes, etc.) and not being directly involved in revenue producing businesses like gambling and alcohol?  

     I'm a firm believer that the slots, the OLG and LCBO should be privatized, but I also believe that they should continue sin taxing these revenues so that they don't lose out in needed revenues to pay for health care, education, police, etc. etc. etc.   
     But as former PC Minister John Snobelen points out, the Ontario government is addicted to sin.    In fact, the government is looking for a partner to bring in Online gambling to Ontario.  Funny, the Liberal politicians probably won't refer to their new partner as being subsidized when they wind up taking away "potential" revenues from the government thanks to revenue sharing agreements.  The reality of online sports betting, slots and poker run by the government will be harsh enough when it comes to clobbering slot revenues to tracks even more.  The one good thing that came out of the Drummond Report is a potential wakeup call to the industry:  It is time to compete as a racetrack!  It is time to compete for Ontario's gambling dollars.  Slots are part of the competition. A gambler that loses $200 at the track on average churn has made the track and horsemen $180, while someone who loses $200 playing slots has only made the track and horsemen around $20 on average.

I would definitely vote for Snobelen if he ran for anything.  Check out this short video on the subject of slots and Ontario racetracks.
I find the Drummond Report a tad out of touch with reality.  It is almost like Drummond is insulted that convenience stores make money off selling Lotto tickets.   I'm surprised he didn't give a recommendation that cigarettes should be sold at other locations too so as to avoid "subsidies" paid to store owner.  

As for Fort Erie. You can see by the numbers that they are the least efficient track in Ontario. However, if the argument is made that horse racing in Ontario is important, a B track is desperately needed. Every circuit needs a track that serves as an out for horses that can't compete in the big leagues. B tracks keep the breeding industry alive, and keep owners in the game (as it would become too complicated for owners when it comes to horses that can't compete at Woodbine to "HAVE TO" ship their horse to the States to be competitive. It would cause too much of a glut of unwanted horses on the market as well.

Either Fort Erie needs to be subsidized or Ajax (not crazy about bullrings) would need to take over as the B track, or Woodbine would need to race 7 days a week allotting two days to B races.

Fort Erie is too beautiful a track to close down. But if the government is starting to turn its back on the racing industry in any way, this could easily be their last year. On the other hand, we are only talking an extra two or three million a year to keep it operational. Seems like a tiny amount of dough in the big scheme of things, and it would prevent Fort Erie from turning into a ghost town.

An argument could be made, and really should be made, that the one thing unfair about slots is that some locations are much better than others, and perhaps money should be pooled and distributed on the basis of wagering generated. There really should be incentive to get wagering on horse racing up at individual venues.

One more thing. Looking at the comments from Woodbine reps, it appears that they believe Woodbine, despite the fact Woodbine and Mohawk wind up with half the $340 million earned by racetracks in Ontario, is safe from any potential damage the government may do to the horse racing industry in Ontario. I wonder if Woodbine knows whether they will get expanded gambling, or if they have assurances that a Toronto casino will not be built.

The only gripe I have with all that money Woodbine gives out in purse money is the purse monies for major races. It could successfully be argued that half a million to million dollar international races do not pay for themselves from wagering on the racing product. Therefore, quite a lot of slots money is given to outfits that may come to Ontario for a week or even less than that. But on the other hand, the government doesn't seem that concerned that the slots money winds up in the hands of Ontario horsemen. To me, that is really what a realistic report should have focused on. Slot money going back into the economy is good for the people, good for taxes, and therefore good for the government. There should be a major preference to Ontario residents over US outfits as well. I don't think that is the case right now.

UPDATE: Bill Finley lays blame on the lack of growth in harness racing in Ontario on the Horsemen. They rejected a growth plan. He also suggests that a massive takeout drop should be experimented with.

15 February 2012

Drummond Report Regarding Horse Racing and Gambling

My quick take on this report and what is feasible:  I don't see cuts in track or horsemen shares in slot revenues.  There looks like there will be more competition though.  Most likely online slots, poker and sports betting.  I highly doubt that we will see new casinos sprouting up except maybe downtown Toronto.  Percentages from slots won't drop but profits most likely will.  The government is asking tracks to focus on their core product and start making money on the betting side (which tracks may start to do as slot revenues drop coupled with the scare they just received from the report).  Tracks may actually now begin to woo Horseplayers and compete with the government...they may be forced to.

The first mention of horse racing is in Chapter 11 (Business Support):

The horse racing industry is another area where subsidies to racetracks and horse people require a review and adjustment to realign with present-day economic and fiscal realities. Ontario has more racetracks than any other jurisdiction in the U.S. or Canada. In addition to revenues from wagering, since the late 1990s the industry has benefited from a provincial tax expenditure (a reduction to the provincial pari-mutuel tax) and a percentage of the Ontario Lottery and Gaming Corporation’s gross slot revenues that together are worth an estimated $400 million in 2011–12. Over the past 12 years, approximately $4 billion has flowed through 17 racetracks to support purses, racetrack capital improvement and operating costs. Ontario’s support is 10 times that of British Columbia, which has six racetracks, and 17 times that of Alberta, with five racetracks. Ontario’s approach is unsustainable and it is time for the industry to rationalize its presence in the gaming marketplace. For more on the horse racing and breeding industry, please see Chapter 17, Government Business Enterprises.

Recommendation 11-11: Review and rationalize the current provincial financial support provided to the horse racing industry so that the industry is more appropriately sustained by the wagering revenues it generates rather than through subsidies or their preferential treatments.

The second mention is in Chapter 17 (Government Business Enterprises):

Ontario Lottery and Gaming (OLG)

The OLG provides significant net income to the province, but operational efficiencies could be explored to improve the company’s margins while continuing to respect social responsibility and meet its conduct and management requirement for the operation of all lottery schemes. For example, a number of questionable business practices should, at a minimum, be reviewed from a value-for-money perspective.

  • OLG maintains two head offices, one each in Toronto and Sault Ste. Marie;
  • OLG continues to operate Casino Niagara despite the opening of the permanent and considerably larger5 Niagara Fallsview Casino Resort in 2004;
  • The Slots at Racetracks Initiative, which allows slot machines to be co-located at racetrack facilities only, earmarks a share of revenues generated from slots for racetrack owners and horse breeders. This amounted to $334 million in 2009–10.6 Municipalities that play host to a racetrack also receive a share — five per cent of proceeds from the first 450 slot machines at the facility and two per cent for each machine over that. This totalled $78 million in 2009–10,7 and
  • OLG purchases and provides lottery terminals to point-of-sale locations.

Finally, OLG should continue to seek new and innovative ways to deliver gaming in Ontario to increase its revenues. These include expanding existing business lines, creating new business lines (as it is doing for Internet gambling), and leveraging further private-sector involvement. In all such ventures, the OLG must remain mindful of its mandate to promote responsible gaming.

Recommendation 17-3: Improve the Ontario Lottery and Gaming Corporation’s efficiency through, at a minimum, the following measures:

  • Close one of the two head offices;
  • Close one of the two casinos in Niagara Falls;
  • Allow slot machine operations at sites that are not co-located with horse racing venues; and
  • Stop subsidizing the purchase and provision of lottery terminals to point-of-sale locations and begin to introduce other points of sale for lotteries.

Recommendation 17-4: Re-evaluate, on a value-for-money basis, the practice of providing a portion of net slot revenues to the horse racing and breeding industry and municipalities in order to substantially reduce and better target that support.

Recommendation 17-5: Consider directing the Ontario Lottery and Gaming Corporation to expand its existing business lines, develop new gaming opportunities and make effective use of private-sector involvement.

14 February 2012

Getting Rid Of Slot Subsidy To Ontario Tracks: Not Very Likely

Dwight Duncan, Ontario's Finance Minister, scared the bejeevers out of Ontario's racing industry yesterday by stating that the government is going to reevaluate the $345 million subsidy that tracks and horsemen receive from slots operations.

We'll find out more details tomorrow when Duncan goes into more detail about what Don Drummond recommended.  Duncan has already stated that he will not get rid of all day kindergarten, which means that none of the recommendations are carved in stone.  The one having to do with getting rid of the horse racing subsidy seems unfeasible to me.

Right now, tracks receive 10% of slots, while horsemen receive another 10% (two exceptions, are Ajax which has a different split for horsemen, and Fort Erie, which gives more than 10% to the track to keep it alive).  For the most part, the government gets the other 80%, and of course there are expenses to keep the slots going, buying slot machines, and wages (but these are jobs that are kind of nice to have out there).

What are slot revenues really?  That is money lost by mooches, mostly Ontarians, but in border towns like Fort Erie and Windsor, some comes from US mooches.  At Woodbine, since it is close to the airport, they too get their share of international mooches as well.

The slot revenues last year generated at Ontario racetracks (Racinos) was approximately $1.7 billion.

OK, so why can't the government just grab that other $345 million and use it on health care and education?

Where will they earn that money?  Privately owned racetracks will have no incentive to allow slots to operate on racetrack property.  Even a smaller cut will be questioned because of the cannibalization which occurs when people choose slots over betting on horses.  For example, when someone loses $200 at slots under normal churn, the track only gets $20 and the horsemen another $20.   If that same gambler loses $200 on horses under normal churn, the track gets around $90 and the horsemen get $90 too.  Makes you wonder why racetracks haven't gone after slot players more aggressively the past 14 years, but that is another story.

The government isn't likely to give up on $1.4 billion and all the jobs that go with that.  In fact, the shutting of Racinos, even Fort Erie where the government gets the lowest cut, would be ludicrous.  It is way too risky to believe that the money lost at Fort Erie on gambling would go to Niagara Falls, for example.  It is just as likely that it either won't be lost, or perhaps go to Bingo or Buffalo or online to an offshore casino site.  They could also buy more lottery tickets which would be a push for the OLG in that particular circumstance.

What is true in Fort Erie is also true in the Kawarthas.

So what are the alternatives?

Build casinos close by where the Racino is.   A government looking to make cuts and find money isn't about to spend money building casinos.  No chance, except maybe a full scale casino in Toronto.

Close the Racinos or some of them, with the hope that gamblers will go to the non racetrack casinos.  Again, this is too much of a risk.  The government is in no position to risk it.  There is also Goodwill factor where the gambler feels more at home gambling within a certain distance to their residence, and more comfortable going to a racetrack structure to bet (also, when live racing is on, it isn't unusual for one spouse to play the ponies while the other hits the one armed bandits).

Take slots out of Racinos and put them in bars and gas stations.  I for one would probably think of moving out of the province if that happens.  Crime in Ontario isn't very horrible, but I could see a lot more robberies and shootings if slot machines were found everywhere.  The other thing is that there is no way they'll come close to matching the revenues a casino with its allure has going for it.

Sell the slots operations.  Now there is an idea that has some legs.  These slot outlets are still gold mines, though they might not be as lucrative in the future.  I could see the individual racetracks buying them and handing over the government a nice lump sum to help reduce the deficit.  It makes sense too, when considering that a government shouldn't be in the gambling business in the first place.  They should be collecting taxes on those who are in it and that is where the relationship should end.  So selling off the OLG in parts should be a recommendation (but I don't think it is).

Drop the cut from 20% in total to 10% for example.  Besides the fact that some tracks have deals that go for another 5 or 6 years at 20%, when taking cannibalization into account, at 10% in total, many tracks may tell the government forget it, it isn't enough.  The government is not about to face a lockout when it comes to keeping slots open, anywhere.

It is hard to justify losing 60,000 jobs potentially (a number most like inflated) if one wants to have a remote chance of getting elected again.  But the number is really a lot higher when you take into account the business that are propped up in communities that have Racinos.  From mom and pop hardware stores to Walmarts to Tim Horton Donut shops, killing a Racino could mean killing quite a few businesses that aren't even horse racing related.  And killing these jobs would also create a depression in the rural real estate market as well.

The Ontario government has already announced that they are going to start taking wagers on poker, slots and sports online in the near future.  This is going to cannibalize slot revenues and probably racetrack wagering at least a tad anyway.  But if implemented properly, it will probably mean even more revenue for the government.   So I'm definitely not saying that racing shouldn't worry, I just don't see that when the facts on the ground are examined, that this government grab is going to leave the starting gate.

I could be wrong, but I doubt it.  We'll know more tomorrow.

This could either be a not very well thought out recommendation or a devious way to create a compromise in order to get a full scale casino in Toronto without giving Woodbine squat.  BTW, Woodbine and Mohawk receive close to 50% of the $345 million, so making them exempt while killing rural jobs makes no sense either.   At least in the rural communities the majority of the money that is distributed to horsemen goes back in the Ontario economy (this is exactly true with a good percentage of dollars won in purses at Woodbine, again, another story).

Edit:  One more thing.  Are we talking subsidy or talking government tax dollars.  It isn't tax dollars but government business revenues.  People are losing after tax dollars gambling.  They have choices where to spend those after tax dollars.  Take away slots, and they'll spend those dollars elsewhere.  As for slot revenues being a subsidy?  Mostly.  It is more money than racing would receive if it were just relying on horse racing related revenues, but as stated, there is a lot of cannibalization that occurs when a casino is put into a racetrack, and one could argue that since these slot machines are located at a track, it attracts more business than what the government would generate if located elsewhere, so yes, most of the revenue is subsidized revenue, but not nearly all of it.


12 February 2012

More Competition Heading Woodbine's Way

The OLG is serious about running video slots, poker,  and sports betting online (of course store kiosks will also be used) as well as allowing people to buy lottery tickets online.  There is also lots of talk about bringing a new casino to Toronto.

This will definitely make it easier for mooches to blow their dough quicker.  However, I doubt the big money value players are going to get excited, if the OLG's history of giving horrible odds on Pro-Line is any barometer on how they will handle online poker and sports odds.  The smart players will avoid OLG online like the plague.

Woodbine relies on the mooch player, so I can see cannibalization when the OLG  gets their ducks in a row.  Poker and sports bettors will still be able to last a lot longer (unless the OLG uses an absolutely ridiculous house edge) than the typical Ontario Horseplayer who has to try to overcome an average 21% takeout on each wager.

Yes, new gamblers will be created.  More money will be lost.  But Woodbine stands only to lose, unless the OLG hands over the online business to Woodbine on the merits that they have experience with online gamblers.  Would it be worth part of the revenues the OLG would have to give away?  That is the big question.

The same thing is true when it comes to the proposed new casino.  Expansion of Woodbine's casino would be great for Woodbine, and purses.  However, if it is a location having nothing to do with Woodbine, it will cannibalize Woodbine's income in a big way.  Even if Woodbine is allowed to expand when a new casino (at Ontario Place, for example) is built, I expect Woodbine's bottom line to drop (there will be more cannibalization from both the new casino and from the live racetrack bettor who will lose a lot of potential churn money at the track casino).

From a Horseplayers standpoint though, even the worst case scenario won't be all that much of a loss.  If Woodbine were to drop their handle by 33%, purses would still attract close to the same field size as they do today (take a look at field size for allowance races at Tampa and Fair Grounds).  I don't even think quality would suffer that much, if at all.  Trainers and vets would naturally be forced to drop their outrageous rates, and they would make less money (and this will motivate trainers to race more). 

Trainers will also be limited to how much detail they can put into a horse.  I believe that is good for Horseplayers.  Major vet and hyperbaric chamber use will drop off, creating less head shaking performances, and this will create more confidence in bettors.

The loss of certain US trainers won't be missed either, by local trainers or bettors (who shy away more when super trainers show up in a race).  I think it has be a shame that so much slot money (a tax on the poor) winds up in the hands of US based outfits.  This was not why the slots deal was made in the first place.

I have a feeling that Woodbine's "entitlement" has just hit a brick wall.  It would be wonderful if they focused on their actual core product, horse race betting.  They have great unrealized potential on the thoroughbred side especially.

Their long season is a plus.  Handicappers become familiar with horses, jockeys and trainers.  However, the one thing holding them back is the high takeout.  No long term winners are created.  No buzz is created.  Woodbine, with slot money all these years, should have reduced takeout to Keeneland levels or even lower.  They didn't.  And now they might wind up with a deer in the headlights type of scenario.

Woodbine does have a good reputation relatively when it comes to policing illegal drugs.  I'd like to see them take the initiative and make it mandatory that the public be informed when horses have operations (breathing, etc.) or hyperbaric chamber treatment.  If they want to attract more Horseplayers, pricing matters, but so does transparency.

The tragedy that occurred this week at a Florida farm might cause more regulation when it comes to hyperbaric chambers.  Again, there is no reason that this info shouldn't be available to the betting public.

I'm not for banning their use.  I just want to be able to factor it in before I play a race.  Check out this list of benefits for hyperbaric chambers:

Athletic injuries:
  • Desmitis (ligament disease)
  • Tendonitis (bowed or diseased tendons)
  • Fractures
  • Exercised induced pulmonary hemorrhage (Bleeders)
Other diseases for which hyperbaric therapy is indicated include:
  • Acute laminitis (Founder)
  • Reperfusion diseases (severe muscle damage, crush injuries)
  • Colic (intestinal obstruction, colon torsions, volvulus, etc.)
  • Enteritis and endotoxemia
  • Ileus (loss of intestinal motility)
  • Infertility (male and female)
  • Rhodococcus pneumonia in foals
  • Lyme's disease
  • Osteomyelitis (bone infection)
  • Compromised wounds
  • Sinus infections
  • Sudden blood loss
  • Myositis (tying up)
  • Septic arthritis (joint infections)
  • Neurologic disease and trauma
  • Severe necrosis (as in snake and spider bites, toxic substances, etc.)
  • Neonatal maladjustment syndrome
Check out this quote by Wayne Catalano in 2008:

When asked if he thought hyperbaric oxygen therapy is a miracle, Catalano said, "I think it is ... it's been a big help. We've won five or six races out of the tank."


5 February 2012

TVG Racing Roundtable On Drugs In Racing

This is a pretty long video, but anyone who has an opinion of drugs in horse racing or has more than a passing concern really should give it a watch:

A lot of talk and disagreement, but the one thing that stands out (and it took a call in at around the one hour mark), and that is the admission that testing for EPO (add DPO and ITPP which were not mentioned) is a rare event, so all the great stats about the minute percentage of positives are meaningless, and yes, there is a problem, and it isn't just perception...it is perception about something that is real.

How to cut down spending on tests?  Simple.  More severe fines and suspensions including criminal charges and the threat of jail time.

Also, I've always had an issue about tainted/contaminated samples. If it is so easy to taint a sample or accidentally give a horse cocaine (contamination from a using groom for example), then why aren't there a lot more overages?

Trainer Ron Ellis came out of this discussion looking like the Court Jester.  Talk of needing Lasix to race horses more often really lands on a deaf ear, especially when considering that in the 60's and early 70's horses were running a more than they are today.

The highlight of the discussion was Ray Paulick quoting a study by HANA.  I have to say that Paulick was dead on with his comments throughout the Roundtable, he may appear out of touch when it comes to the Horseplayer, but after watching the interview, I'm beginning to think that the act is strictly for show.  Or, just maybe, that wasn't Ray Paulick but Kevin Bacon impersonating Paulick.  That would explain a lot.

Horse racing definitely needs more Jack Van Bergs.