Change Looms for New York-Bred Program

The state breeding fund will grow about 100% through money from VLTs at Aqueduct.

With expectations that funding for the New York-bred program will increase about 100% by 2014, officials hope to strike a balance with plans to expand its offerings and rewards for owners and breeders.

The issue of a revamped New York-bred program became the focal point of an Aug. 12 forum held at the Fasig-Tipton sale pavilion in Saratoga Springs, N.Y., just hours before the New York-bred yearling sale. The forum, which attracted more than 100 people, was held to explain how video lottery terminals at Aqueduct could impact racing and breeding in the Empire State.

The first floor of the Aqueduct VLT casino is expected to open in October, said Michael Speller, casino president for Resorts World New York. The second phase, which is designed for VIPs and high-rollers, should be open in December, he said.

Purses at the three New York Racing Association tracks—Aqueduct, Belmont Park, and Saratoga—are projected to grow from the current $103 million a year to perhaps $140 million. The New York Thoroughbred breeding fund could be valued at $10 million by 2014 based on projections.

“The last 10 years we’ve been waiting for this,” said Jeffrey Cannizzo, executive director of the New York Thoroughbred Breeders. “There will be significant changes to the breeding and racing industry in New York, and what happens in New York will affect breeding and racing nationally.”

Several factors including the demise of New York City Off-Track Betting Corp. created a shortfall in the New York-bred program, which offers about $6 million a year in breeders’ awards, stallion owner awards, and open company awards. As for restricted purses, NYRA pays about $25 million a year.

NYRA president and chief executive officer Charles Hayward said the three tracks probably will offer 120 fewer state-bred races this year only because of a declining number of foals. The average purse for such races, however, will increase about $5,500, he said.

“We like the New York-bred program but we must create incentives to win in open company,” Hayward said. “We’re in the process of looking at our entire schedule. By the end of this year we’ll have a better idea of how (the additional) $30 million to $50 million will be allocated.”

Fasig-Tipton marketing director Terence Collier, who started with the auction firm in the mid-1970s in New York, recalled how the state’s breeding program grew with millions of dollars available for promotion. During that period farms have come and gone, and the New York-bred yearling sale, held for about 20 years, experienced ups and downs.

Collier said the average price in 2009 was $54,000, a figure the company hopes will grow beginning this year given the fact the Aqueduct VLT casino is actually being built after a 10-year delay.

“There is an opportunity for buyers in 2011 to best take advantage of the purses in New York,” Collier said. “The challenge is to convince New York trainers and owners of the value of these yearlings. We have to change the perception of New York-breds.”

The value and relevance of state-bred breeding and racing programs has long been debated. Primarily there are two schools of thought: Breed horses with a goal of racing in open company, or breed them to take advantage of restricted races.

“I’ve seen state-bred programs open and grow, but by most measures they fail,” Collier said. “Protected programs are for narrow, self-interested groups. Open company for New York-breds is the way to make the program last.”

Comments made during the forum indicated there is disagreement on the issue in New York, though it seems doubtful a program that supports more than 400 races, not including those at Finger Lakes Gaming & Racetrack in western New York, and has the support of NYRA will evaporate.

Cannizzo said further advantages for New York-bred runners will be sought the industry at large as it attempts to encourage ownership and breeding to reinvigorate the business. By the numbers in the last years, 25% of breeding farms have closed, the number of mares in the program is down 37%, 4,000 jobs have been lost, the foal crop has dropped 27%, and the number of stallions in the state declined 57%, he said.

Rick Violette, president of the New York Thoroughbred Horsemen’s Association and a member of the NYRA board of directors, said however purse money is spent it will “allow us to take the for-sale signs off the front yard.” Violette, a trainer based at Aqueduct, said the entire industry must work together to devise a plan that benefits all stakeholders.

“We’re splitting hairs in trying to move the bar up,” Violette said. “The last few years at NYRA we saw a lowering of the bar. You have to spend that (VLT) money wisely. Accepting mediocrity doesn’t do anyone any good. Someone has to keep raising the bar.”

NYTB president Barry Ostrager indicated the challenge may not be that difficult given his experiences of recent years. Ostrager said that for the first time in 30 years the various groups are working together effectively and have developed a “true partnership.”

Speller said the Resorts World New York casino, the first to be built in the United States by Malaysia-based Genting, will cost about $830 million to construct. He said some of the $100 million added to the tab is being spent to upgrade the racing side at Aqueduct.

Speller said based on estimates, New York State loses $2 billion to $3 billion being spent at casinos in neighboring states. Genting, he said, plans to target those people who now go out of state to gamble.

“Our goal is to bring that business back to New York, and keep it in New York,” he said.