Calder Zapped by Ongoing Contract Fight
The Florida Horsemen’s Benevolent and Protective Association and Churchill Downs Inc. are planning to meet June 9 to discuss contracts for CDI-owned Calder Race Course, where the financial impacts of a dispute are worsening each week.
Seven weeks into a race meet marred by purse cuts and a 73% drop in handle at the Miami Gardens, Fla., track, some trainers have begun laying off employees, Florida HBPA general counsel Bruce Green said. He hopes most of those jobs can be restored if the horsemen and CDI reach contract agreements on this year’s purses and on future slot-machine revenue. The layoffs came several weeks after some owners began moving some horses to tracks in northern states with higher purses.
The June 9 meeting at a to-be-determined site in South Florida would be the first between officials of Florida HBPA and CDI since May 21. They have since exchanged written proposals, but are not disclosing details. CDI executive vice president Steve Sexton has been among the company officials at Florida meetings.
A central issue remains that the Florida HPBA will not sign a purse contract unless CDI also signs a contract on division of future slots revenue. CDI has said it plans to build a casino at Calder, but has not announced any timetable or other details.
Calder and CDI also are in the center of a national dispute in which the Thoroughbred Horsemen’s Group is negotiating advance deposit wagering contracts for the Florida HBPA and its other members.
The impasse has led to a blackout of the Calder signal outside of Florida. That is generating concerns that Calder could become “a forgotten track” for many bettors if contracts are not signed soon. Since Calder opened its meet April 21, it has not been able to send its signal to any tracks outside Florida.
The Florida HBPA, whose members are entering races without a purse contract, is using authority under the Interstate Horseracing Act to prevent out-of-state signal exports. In support of the Florida HBPA, horsemen in eight other states are preventing tracks from sending signals to Calder, which this spring has been a victim of timing.
Calder opened its meet as the THG was beginning negotiations with Tracknet Media Group, the ADW content consortium of CDI and Magna Entertainment Corp.
“Very little is coming in and almost nothing is going out,” said Ken Dunn, Calder’s former president who will remain its top on-site executive until Aug. 1.
Through its first 25 days this year, Calder’s daily average all-sources handle was $814,000, according to The Jockey Club Information Systems. That is down from an average $3 million for the same period in 2007.
When non-Florida tracks and other outlets again receive Calder’s signal, Dunn is concerned that some bettors who previously bet on Calder will not return. He likened it to a shopper who has used “ketchup A,” but finds a grocery store is not carrying it. The shopper “can choose between three or more other brands, and might find one he likes and stay with it,” he said.
In addition to its direct decline in dollars, the loss of interstate export handle has produced smaller pools that have led some large on-site bettors to not wager on Calder races. With expectations of reduced handle, Calder beginning April 27 cut its average daily purses by 30%. On May 9, Calder announced it would cut purses for many of its stakes.
The Jockey Club data show Calder’s average daily purses, including stakes, declined 16% year-to-date. The averages for the first 25 days were $218,107 in 2007 and $183,871 this year. Those numbers indicate an $850,000 decline in purses, year to date.
“Nobody that I have spoken with has had an answer to, ‘What will you gain by holding out on a purse contract and having less revenue this year, for a slots agreement for which you are well aware you will have no revenues in 2008,?’ ” Dunn said.
The Florida HPBA has made estimates of future slots revenue but is not disclosing them, Green said. Miami-Dade County voters on Jan. 29 passed a ballot issue that authorizes Class III Las Vegas-style slot machines for Calder.
“For two years, we have made it clear that we would need to negotiate a purse contract and a slots contract together,” Green said. The Florida HBPA has always wanted a slots deal in the year voters approved them for Calder, to help it project future revenue, he said.
CDI believes its announcement of size and other details of a casino should precede a slots contract with the Florida HBPA, Dunn said.
On April 9, CDI announced that Dunn had stepped down as Calder president and would remain an adviser to the track until Aug. 1. CDI has not named a successor to Dunn, who had been Calder’s president since 1990.
“I hope to continue in this industry,” Dunn said. “If that is not possible, my preference is to stay in South Florida as a home base.”
Meanwhile, Dunn is meeting with Florida HPBA officials and members in the hope of working toward contracts.
“We never thought it would come to this,” Green said of the contract impasse. “We will be prepared to meet all day and all night (June 9-10), and ad infinitum to get things resolved,” he said.
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