Churchill Downs

Churchill Downs

Anne M. Eberhardt

New Churchill Contract About More Than Money

Churchill Downs and Kentucky horsemen have a new contract at a critical time.

Churchill Downs and Kentucky horsemen have reached a three-year agreement that sets purse payments, establishes purse supplements and ends a legal dispute that began in the spring of 2008.

The deal, announced Oct. 23, comes as the Kentucky racing industry faces increasing competition from other states whose racetracks pay purses and breed development funds inflated by gaming revenue.

Money aside, it also sends a message. Horse industry representatives have said some Republican lawmakers are attempting to divide horsemen and racetracks over the issue of racetrack gaming in Kentucky.

Churchill, the Kentucky Horsemen’s Benevolent and Protective Association, and the Kentucky Thoroughbred Association agreed on the contract. The Kentucky HBPA and KTA both have negotiating rights at Churchill. The last contract expired after the 2008 spring meet.

As part of the deal, the Kentucky HBPA and Churchill Downs Inc. agreed to dismiss their claims against one another in a lawsuit filed in United States District Court for the Western District of Kentucky. In that suit, horsemen were seeking more revenue from account wagering, and claimed purse reductions at Churchill were done in retaliation.

A release didn’t specify the agreed-upon purse levels, though purses at Churchill are among the highest in the country. The supplement is $1.5 million spread evenly over three years; Churchill can distribute a greater share early in the three-year period should purses below anticipated levels, officials said.

“Churchill Downs is very pleased to be part of this long-term agreement that is good for horsemen, Churchill Downs, Kentucky’s embattled horse industry, and racing fans in Kentucky and throughout North America,” Churchill president Kevin Flanery said in a statement. “This three-year pact between our track and horsemen comes at a crucial time for Kentucky’s horse industry as horses and horsemen are leaving our state to pursue the growing purses and breeding incentives that exist in states with slots and other expanded wagering options at their racetracks.

“Decisions are being made daily on where to breed and race in 2010 and beyond, and once horsemen, stallions, and mares leave Kentucky, it will be very difficult to get them to return.  Churchill Downs’ commitment to provide an additional $1.5 million to purses is an effort to protect Kentucky racing from states that supplement their races with expanded gaming revenues. Our hope is that the purse supplement will help keep a few more horses and horsemen in Kentucky through 2010 while our united horse industry works for the passage of legislation that would allow additional gaming at racetracks and level our competitive playing field with tracks and breeding operations in those rival states.”

Legislation to authorize video lottery terminals at racetracks passed the Kentucky House of Representatives but died in a Senate committee earlier this year. The issue is expected to come up again during the 2010 General Assembly session.

Horsemen and tracks have insisted they are on the same page in seeking statutory approval for racetrack VLTs. They balked at a recent Republican proposal for a constitutional amendment in November 2010.

Kentucky HBPA president Rick Hiles called the new deal with Churchill “a good contract—I think it’s good for both parties.” Hiles said horsemen and racetracks “look forward to working together over the next three years in the effort to get all of Kentucky racing back on track.”

“The KTA appreciates the professional and unified manner we experienced in working with Churchill Downs in our recent negotiations for a contract renewal,” KTA president Don Robinson said. “We believe all parties, owners, trainers and the track will benefit as racing continues in these troubled economic times.”

Churchill will begin its fall meet Nov. 1, with racing scheduled for five days a week through Nov. 28.