CHRB Wrestles With Changes to Fair Circuit

Racing at California fairs, long supported as one of the best ways to attract new fans for the sport, is losing out to economic considerations while industry representatives fight to remain viable in the northern half of the state.

During a 5 1/2-hour meeting before a standing room crowd at the Golden Gate Fields turf club Nov. 17, the California Horse Racing Board gave final approval to a host of changes in drug testing and veterinarian procedures and extended the operating licenses of the four legal advance deposit wagering companies in the state for one year. But the issue the board spent the most time on -- allocating about 80 racing dates for the fairs next year -- was left unresolved.

Chairman John Harris directed that the California Authority of Racing Fairs continue negotiating with horsemen and Pacific Racing Association, operator at Golden Gate Fields, over their competing date plans and possible revenue sharing. Since there is no board meeting scheduled next month, he said that a telephone conference call, probably Dec. 17, would be convened by the board to give the issue further consideration.

Under the current dates proposals before the CHRB, racing at the Solano County Fair in Vallejo has been eliminated and the San Joaquin County Fair in Stockton reduced to five days. Those moves further the consolidation of racing venues that began last year with the loss of the San Mateo County Fair meet due to the demolishment of Bay Meadows. The major scheduling issue remaining to be resolved between the two sides is what to do with the week leading up to Labor Day.

For the better part of a century, the Labor Day meet has been held at the California State Fair in Sacramento. But the Cal Expo board, concerned with declining attendance in recent years, moved its fair to July 14-25 and the race meet will move with it, under the date plans.

CARF wants the Labor Day dates to be run under its direction at Alameda County Fair as part of a 16-day meet that begins Aug. 18. The horsemen -- the Thoroughbred Owners of California and the California Thoroughbred Trainers -- want the dates to be run at Golden Gate Fields under Pacific Racing. The issue is further clouded because Alameda County Fair has for 14 years offered a "Scottish Days Celebration" on Labor Day weekend that attracts some 30,000 people to the fairgrounds. Many of the events during the athletic competition are held at the track in front of the grandstand.

"From our perspective, this is an economic issue," said Guy Lamothe, executive vice president for the TOC. "What we want to concentrate on is purse generation, which we feel can best be accomplished at Golden Gate Fields."

Lamothe estimated Golden Gate would produce 30% more revenue for purses than would Alameda County, based on its average daily handle for the first six months of this year compared to what CARF generated during the fair season that wrapped up last month.

Chris Korby, executive director for CARF, said additional dates for the Alameda County Fair makes more sense because the long-term stability of racing in the region will require a commitment to fair facilities. Golden Gate Fields, part of the holdings of bankrupt Magna Entertainment Corporation, is scheduled to be auctioned off early next year.

Rick Pickering, the fair's CEO, told the board: "We are not here to beg for dates and I'm sorry if it sounds that way. We are constantly being told that for the good of the industry, we will need to run more dates at Alameda County Fair because of the uncertainty over the future of Golden Gate Fields."

Lamothe countered, "This is about keeping owners in the business. We have a four-month bloc (for the fairs) in which owners might go out of state. Will they come back?"

Pickering said that because of the use conflict with the Scottish celebration, he is willing to allow Golden Gate Fields to take the Labor Day week, presumably in a revenue-sharing arrangement. This would give Golden Gate a week's head start on its 103-day fall/winter meet, which is currently set to begin Sept. 8 with a two-week break for the Fresno County Fair Oct. 6-17.

As a side issue, Golden Gate hosted a pair of abbreviated meets under the CARF umbrella in 2009, with profits at the meet designed to go toward facility improvements at Alameda County. But handle underperformed, resulting in a $300,000 overpayment of purses. Later in the season, Cal Expo had an underpayment to purses of $190,000 and that money was not dispersed to horsemen, according to a CHRB report. It was not clear if CARF intended to use the underpayment to help pay back the earlier overpayment at Golden Gate or carry it over to 2010. The CHRB wants to see that matter resolved as well.

In addition, Harris urged CARF and the horsemen to carve out a week of the schedule so that the struggling Humboldt County Fair in Ferndale could race without overlapping competition with other fairs. The Ferndale site is well off the beaten path in the remote northwest part of the state and Thoroughbred trainers have, in recent years, resisted shipping there to run in low-level claiming races. As a result, the meet is heavily geared toward mixed breed racing. Under the current CARF proposal, Humboldt County would race for nine days from Aug. 12-22, overlapping with the final week of an expanded three-week Santa Rosa meet and the start of the CARF meet at Pleasanton.

"We're jut asking for a fighting chance here," said Stuart Titus, general manager for the Humboldt County Fair.

Turning to Southern California, the board approved an 83-day winter/spring meet for Santa Anita to run five days a week from Dec. 26, 2009, to April 18, 2010. Jack Liebau, president of Hollywood Park, complained that by racing a full schedule, Santa Anita would deplete the horse inventory as it did last year, when his spring/summer meet lost 10 days due to an inability to fill its programs with the existing stock.

"The pain should be spread around between all the tracks," Liebau said. "Santa Anita was unscathed (by the low inventory) last year. It was the only track that was unscathed."

Harris said that revenue generation is the main reason for approving Santa Anita's full schedule.

Commissioner David Israel noted that Santa Anita could request, as Hollywood did last year, to cut back if necessary. As a winter meet in a warm weather climate, he said, Santa Anita attracts more out-of-state horses than other California meets.

"Let's see what happens during the course of the meet," Israel said.

Mike Harlow, Santa Anita's director of racing, said the track is heavily recruiting many of the name stables based in the east. He admitted that Santa Anita had problems filling their cards toward the end of its meeting last year, adding, "That's the way the business is right now."

Harlow said the horse population in the region, with 1,800 horses stabled at Santa Anita and about half that at Hollywood Park, is about 1,000 horses fewer than would be ideal.

The board also approved a 115-day meet for Pacific Racing at Golden Gate Fields. The stand will run from Dec. 26 to June 13.

Both Golden Gate and Santa Anita are scheduled to be sold at auction early next year. If bankrupt Magna Entertainment's sale goes forward successfully, the bankruptcy court could issue the final sale order as soon as Feb. 26, meaning both meets could be changing management during the course of their runs.

The board also approved one-year licenses for the ADW providers Betfair/TVG, Twinspires.com, Youbet.com, and XpressBet for 2010. The applications were approved with little comment, although TVG did come in for a bit of a grilling from Israel for its "shabby" treatment of the recently-concluded Oak Tree Racing Association meet at Santa Anita.

Israel accused TVG of reacting to its loss of exclusive broadcasting rights to Oak Tree's races by ignoring it and concentrating on racing at Belmont Park instead. TVG ran many of Oak Tree's races without discussion by its on-air talent team, often showing races on tape delay.

"I found it a passive-aggressive approach to penalizing California racing because you lost your monopoly," Israel said. "You decided to play hardball and you played hardball with a state" that provides TVG with nearly half of its wagering handle.

Greg Nichols, Betfair's managing director of sporting affairs, said there was no vendetta against Oak Tree and that TVG was simply honoring its contractual obligation to tracks with exclusive broadcasting agreements with the largest of the home betting companies.

"I assure you there was not one ounce of malice," he said. Nichols explained that the network gravitated toward the New York Racing Association because it "provides racing 350 days a year and a consistency of product."

Sherwood Chillingworth, executive vice president for Oak Tree, said that after nearly a decade with TVG, "we were treated very shabbily" because it allowed broadcasting rights to the competing HRTV. He said TVG often showed Louisiana Downs, which is not exclusive, either, rather than Oak Tree.

"The only implication of that is that we were being punished," Chillingworth said to TVG representatives. "But I think it is better to look ahead. I'm looking forward to a much better relationship with you fellows next year."