CHRB Questioned, Supported During Legislative Hearing

CHRB Questioned, Supported During Legislative Hearing
Photo: Tim Sharp
California Horse Racing Board chairman Richard Shapiro.

The California racing industry voiced nearly united support for synthetic racing surfaces and for the board that mandated them during a packed California Senate committee hearing Wednesday, June 13, in Sacramento.

The California Horse Racing Board  -- as well as its beleaguered chairman Richard Shapiro -- needed all the friends they could get during the charged 4-hour, 15-minute special session of the Senate Governmental Organization Committee. The CHRB had its $10.8 million annual budget zeroed out last month by a Senate sub-committee in a political dispute stemming from the potential closure of Bay Meadows Race Course.

Sen. Dean Florez, a Democrat from the central California community of Shafter who is chairman of the committee, called the informational meeting to ask why the board found itself in such political hot water over its synthetic track mandate passed in 2006. Sen. Leland Yee, another Democrat whose San Francisco district includes Bay Meadows, tried to provide the answers.

Undaunted by the solid show of support for Shapiro and the CHRB from the industry, Yee grilled Shapiro, assistant chairman John Harris, executive director Ingrid Fermin and Dr. Rick Arthur, the board's equine medical director, on a variety of subjects. They ranged from Shapiro's criticism of legislative interference to alleged conflicts of interest in board decisions and the source of Arthur's $200,000 annual salary.

Yee questioned CHRB reps on whether they considered the negative impact on working families who would be uprooted if the synthetic track mandate -- requiring all five major tracks in the state to convert their conventional dirt tracks by Jan. 1, 2008 -- were to cause a track to close.

But he mostly fired blanks. As the late afternoon hearing stretched well into evening, Yee's colleague on the committee, Sen. Patricia Wiggins, interrupted the San Francisco representative's interrogation to say, "Everybody in this industry is very excited to be working with this board. I don't understand why you are beating them up."

As Yee continued to question Arthur about his salary, Wiggins rose to walk over to Florez and ask him to cut off the questioning. Florez did not.

Yee made it clear he thought the board had a conflict of interest when it retained Arthur, a former private veterinarian with a number of high-profile trainer clients. He charged that racing associations were paying Arthur's salary, including $100,000 from the Oak Tree Racing Association, for which Arthur is a former director. Arthur works for the CHRB in a joint powers agreement with the University of California-Davis, where he is on the faculty staff. Fermin explained that a quarter of the medical director's salary is funded from other sources, including the university, but the bulk of it ($147,000) comes directly from the CHRB.

The senator persisted, arguing that such an arrangement led to decisions rife with conflicts of interest ("Maybe some are, maybe some aren't," he said), when Arthur finally interrupted. "Senator Yee, I took a 60% pay cut from private practice in order to take this job. I did this because I love this industry and I thought I could make a difference."

Arthur added, "Who pays my salary has nothing to do with my professional opinion in a case. Never has. Never will."

Yee hit the CHRB for approving the Thoroughbred Owners of California budget, including its lobbying allocation, as a further conflict of interest, only to learn from Tom Bachman, representing the TOC, that lobbying is not part of the organization's operating budget. All such activities are paid for through private donations from horsemen, Bachman said.

He pressed Shapiro and Fermin on the hiring of trainer Darrell Vienna, also an attorney, to make recommendations to streamline CHRB rules and the handling of cases while Shapiro later co-owned a horse briefly in Vienna's care, then learned that Shapiro lost $20,000 on the equine investment. Vienna quit the consultant post, for which he was paid $124,000, on May 15 after the issue of his no-bid contract went public.

Yee charged that board member John Amerman, a major horse owner in the state, sought special treatment to avoid forfeiting $24,000 in purse money from a trace morphine positive case more than six years ago in which charges against trainer Bobby Frankel were dropped after an "environmental contamination" finding. Shapiro told Yee that Amerman was not required to pay back the purse until after the case was adjudicated, but agreed to waive a hearing and forfeit the money "in order to be a team player." Amerman's confirmation for a new term is reportedly being held up over the issue.

It appears that Yee's staunch support for Bay Meadows will buy the storied track a little more time. The track's owners announced the 73-year-old venue would close in November rather than install a new racing surface after their application for a two-year exemption was denied by the commission in March. Shapiro told the committee he would favor a one-year waiver for the track in 2008 and the matter is up for reconsideration at the CHRB's June 19 meeting at Hollywood Park.

But what was most striking about the hearing was the show of support for synthetic tracks and the board's decision.

Cliff Goodrich, who represents the Los Angeles County Fair and has been in racetrack administration for more than 40 years, told the committee, "The synthetic track mandate of the CHRB is the greatest safety measure for horses and riders in the history of Thoroughbred racing." He applauded "the courage of chairman Shapiro and the CHRB" and said the Bay Meadows Land Company, which also owns Hollywood Park, should be required to make certain its plans for both the Inglewood track and Bay Meadows so the board can make plans for the future.

Ed Halpern, executive director of the California Thoroughbred Trainers, said, "There's a unanimity of opinion among trainers as to the value of synthetic surfaces," and said the CTT board was nearly unanimous in supporting the board's decision to deny the Bay Meadows waiver.

"I think we're in 100% agreement that the horse racing board needs reorganization," he said. "The current board is being blamed for the problems but it is certainly not deserving of being attacked," adding they are "tackling head on" the problems in racing.

Hall of Fame trainer Richard Mandella said that synthetic tracks are attracting owners back to California after years of decline in the horse population. "Mr. Shapiro took a very bold step" in favor of safety, he said. "Synthetic surfaces are the one thing that brought us (trainers) all together. I credit him (Shapiro) for getting it done."

Trainer Howard Zucker agreed, saying the board has directly confronted the three major issues in California racing in recent years -- workers' compensation insurance, track safety and medication rule enforcement. He said the sport needs legislative relief on alternative gaming or mitigation for the damage done by tribal casinos to fix the racing business.

"Senator Yee," he said. "You want to save your racetrack? You've got to talk to the governor."

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