Is Magna Target in Fairplex Dates Plan Gunfire?

by Jack Shinar

The Los Angeles County Fair's desire to move its September racing meet to Santa Anita Park has become a referendum on Magna Entertainment Corp.'s control of California racing dates.

"This whisper is now a cannon," California Horse Racing Board chairman Alan Landsburg said of the long-simmering feud, enflamed by the fair's five-year lease agreement with Magna-owned Santa Anita. "It's Churchill versus Magna in California, and we are the arbiters."

The CHRB met June 6 at Bay Meadows but didn't take action on the Fairplex Park dates plan. The judges ruled the contest a draw and opted for more discussion on what to do with the 17-day meet.

In a 3-3 vote (with one abstention) of the seven-member CHRB, commissioner John Harris' motion to deny the fair's request to approve the move was defeated. The board unanimously agreed to call a special meeting for later this month in Pomona, where Fairplex Park and the Los Angeles County Fair are located, to complete its deliberations. A date should be announced soon.

The abstention came from commissioner Marie Moretti, who indicated afterward she was leaning toward allowing Santa Anita a one-year trial to operate the Los Angeles County Fair meet (Sept. 13-29), an option that was discussed by the board but never brought to a motion.

A freewheeling three-hour debate on the issue touched on numerous subjects, including Magna's growing monopoly on California Thoroughbred racing dates, the free-enterprise philosophy of Magna owner Frank Stronach, and fair racing in general. Attorneys representing Hollywood Park and the Oak Tree Race Racing Association threatened legal action if the board went ahead with the Fairplex request.

Landsburg's cannon remark came in response to Hollywood Park president Rick Baedecker's assessment of the current breakdown of racing dates among the major tracks in the state.

"If the board were to approve this, it would mean that of 479 daytime racing dates this year, 95 are at Hollywood Park, 43 are at Del Mar, and 341 are at a Magna-owned track," he said.

Baedecker noted that Churchill Downs Inc.-owned Hollywood Park did not oppose Magna's applications to take over Golden Gate Fields and Bay Meadows in Northern California even though both required special exemptions from the CHRB to allow Magna to operate more than one track.

"I'm just trying to state some facts here," Baedecker said in response to Landsburg.

Jack Liebau, Magna's director of California racing, said: "It is indeed unfortunate that this has become Churchill versus Magna, or the world versus Magna. I'm a little surprised."

Responding to criticism leveled at the deal by the Oak Tree Racing Association, Del Mar, and the Thoroughbred Owners of California, Liebau said there was no legal reason that Fairplex could not take dates that had been allocated it to another venue.

He said the move "was not going to affect" the Oak Tree traditional fall opening at Santa Anita. He noted that that fair purses were far smaller than those at Oak Tree and Del Mar (which closes immediately before the fair) and would not attract the same quality of horses.

Liebau said there would be only a couple of turf events during the entire run of the fair, and that it would cause only minimal impact on the course. And he noted that Santa Anita would provide a more amenable location for racing fans than Fairplex, with the potential for better attendance and bigger handle.

"I don't think anyone in California has invested as much in racing as has Magna," Liebau said. "(The criticism) just doesn't wash. Our industry will benefit. Whatever we can do to improve racing is going to be to everyone's benefit."

Many observers were surprised when fair president James Henwood refused to state publicly any terms of its agreement with Santa Anita. Henwood and his attorney, Robert Forgnone, objected when it was suggested the fair had "sold" its dates to Santa Anita. He said it isn't a sale but a lease.

Oak Tree executive vice president Sherwood Chillingworth took aim at that. "This agreement should be made public," he said. "We will pay Santa Anita in excess of $5.5 million through the end of this year. Here we have a situation where the landlord is paying the tenant. Who ever heard of anything like that? We want a deal like that.

"I'm troubled by the idea that you are planning to improve racing by taking the fair dates to Santa Anita and jeopardizing a meet that has been there for more than 30 years."

Chillingworth also questioned the advisability of consolidating more of California's racing under Magna chairman Stronach.

"Mr. Stronach has been very much in favor of deregulation, getting rid of boards like this one," he said. "You should be concerned about that."

Del Mar executive vice president Craig Fravel urged the board to consider the "long-term ramifications" of allowing a fair meet to pick up and leave for a better deal elsewhere.

"I just don't see the authority here," Fravel said. "If you approve this, I see nothing that would stop any fair from entering a similar agreement with any other track."

Fravel also questioned whether California law would allow Fairplex to continue to operate a simulcast facility when it would no longer have live racing. He and TOC president John Van de Kamp suggested delaying any action until the CHRB's date committee has a chance to consider the move as part of its allocation process for next year.

Ed Halpern, executive director of the California Thoroughbred Trainers, said an informal polling of his membership as "better than 3-1" against approval of the transfer. He said the CTT was sensitive to anything that could harm the viability of the Oak Tree meeting.

"Oak Tree is extremely generous in its support of our backstretch employee programs," Halpern said. "The fair, for various reasons, has not provided the same kind of support."

In other business, the CHRB followed the lead of the Association of Racing Commissioners International and began the process of adopting a regulation that would prohibit the possession of or use of erythropoietin, commonly known as EPO, and related substances.

EPO and related substances such as darbepoietin are believed to enhance performance in both human and equine athletes. There currently is no test for EPO, though researchers have been working for years to develop one. RCI, the Lexington-based regulators association, has been instrumental in facilitating the research.

RCI recently made administration of EPO and related substances a "prohibited practice." The organization hopes racing jurisdictions include that policy in their regulations. The New York Racing Association has stated the practice will not be permitted on racetrack grounds.

In regard to account wagering, the CHRB said $46.5 million was handled by TV Games Network, XpressBet, and Youbet.com from Jan. 25 to May 26. The figure represents 5.3% of the $877 million in on-track, off-track, and account wagering handle in California for that period.