Parties Assign Blame in Gulfstream Rate Dispute

As of early in the afternoon of Jan. 7, it appeared an ongoing dispute over simulcast rates would keep the first weekend of racing at Gulfstream Park from being offered at off-track betting parlors across New York.

Several of the six OTB corporations had notices posted on their Web sites claiming a dispute between the Florida Horsemen’s Benevolent and Protective Association and Gulfstream is the reason their patrons can't watch and wager on races from the South Florida track. On Jan. 3, New York City OTB executive vice president and general counsel Ira Block said horsemen are impeding Gulfstream from fulfilling the provisions of a contract NYCOTB has with the track.

“New York OTB customers are hostage to the contretemps,” Block said.

Florida HBPA executive director Kent Stirling disputed that claim. “It’s not us holding the signal hostage, it’s the greedy New York OTBs,” he said. “Gulfstream is completely supportive of what we’re doing. I’m not sure about (Magna Entertainment Corp., which owns Gulfstream).”

Stirling said the horsemen's group wasn't aware of the contract when it was first signed. Block has said NYCOTB, the largest of the state's OTB corporations, isn't aware of "what the horsemen know or don't know about the contract."

Last year, the OTB corporations paid 2.55% for the Gulfstream signal, less than the rate charged to some facilities that offer live racing. The Florida HBPA in September 2006 notified MEC and the six OTB corporations that it planned to ask for 2.85% for the 2007 meet, Stirling said.

Negotiations didn’t begin until recently, and the Gulfstream signal wasn’t available Jan. 3, opening day of the 2007 meet.

The 2.85% horsemen seek is the total rate, which would be split 50-50 with Gulfstream. Stirling said the rate increase would produce $225,000-$250,000, half of which would go to MEC.

Based on Gulfstream’s blended takeout rate of 19.5%, Stirling said the $75 million in handle on the Gulfstream meet last year by the six OTB corporations would have produced more than $8 million in what he called profit. “What’s wrong with this picture?” Stirling said.

Meanwhile, on Jan. 6, the first Saturday of the meet, total handle at Gulfstream topped $9 million. The on-track figure was more than $1.2 million.