Texas Commission Says HISA Has ‘No Effect’ On Its Rules; Sam Houston To Resume Simulcasting

Texas Thoroughbred racetracks may resume exporting their simulcast signals this week, based on a decision by the Texas Racing Commission stating that simulcast requests “will only be considered in a manner consistent with Texas law. All horseraces in Texas will continue to be conducted in accordance with the Texas Racing Act and the Texas Rules of Racing.”

In a letter dated Feb. 1 to all occupational and business licensees of the Texas Racing Commission, commission executive director Amy Cook wrote that the federal law creating the Horseracing Integrity and Safety Authority “has no effect on the state of Texas.” That position was taken after an order on Jan. 31 from the Fifth Circuit Court of Appeals that it would not vacate its November opinion finding the law “facially unconstitutional.”

HISA and the Federal Trade Commission had asked the Fifth Circuit to reconsider that November opinion in light of an amendment passed by Congress in late December intended to address the constitutional questions affirmed by the appellate court in a lawsuit filed by the National Horsemen's Benevolent and Protective Association and numerous affiliates. The Fifth Circuit reversed a decision by a district court that upheld the law's constitutionality.

Last year the Texas Racing Commission said it could not comply with HISA regulations because of state law assigning regulatory authority to the agency. As a result, the commission said tracks would not be able to export their simulcast signal, since the federal law defined “covered tracks” as those which conducted interstate simulcasting.

HISA issued a statement through spokesperson Mandy Minger suggesting the late December amendment to the legislation effectively changed the law and that the current version of the Horseracing Integrity and Safety Act has not been struck down in court.

“The Fifth Circuit's decision concerns only the prior version of HISA, before Congress amended it to remedy the constitutional concern the Fifth Circuit identified,” the statement read. “No court has expressed any constitutional concern about, let alone enjoined, the current version of HISA now in effect.  We look forward to working with the Texas Racing Commission and Texas racetracks should they resume operations falling within HISA's jurisdiction.”

Resumption of simulcasting puts Texas within HISA's jurisdiction under the federal law, but the statement did not indicate how the Authority would enforce that law.

Published reports indicated that Sam Houston would resume export of its simulcast signal on its next day of racing, Feb. 3. Without simulcasting, handle has been down approximately 90 percent since the meet opened, according to published reports.

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Texas Once Again Allows Simulcasting Signal Exports

On the back of Tuesday's decision in the Fifth Circuit Court of Appeals denying a motion by the Horseracing Integrity and Safety Act (HISA) Authority for that court to vacate its recent opinion that the law is unconstitutional, the Texas Racing Commission (TXRC) has reopened the door for Texas tracks to beam their signals out-of-state, with Sam Houston set to begin this Friday.

Last year, the TXRC argued that it was statutorily barred from joining HISA, and because the enabling federal legislation gave the HISA Authority regulatory jurisdiction over the interstate simulcasting of races, the commission prohibited Texan tracks from exporting their signals.

“I called the Sam Houston Park general manager this morning and asked him to provide me an export request, and I've already approved them,” said TXRC executive director Amy Cook, who also wrote in a memo Wednesday to licensees that the Fifth Circuit's decision finding the law “facially unconstitutional” meant it has no effect on the State of Texas.

Chris McErlean, vice president of racing for Penn Entertainment, Sam Houston's parent company, confirmed that the simulcast signal will be beamed to its out-of-state partners when racing resumes this Friday. Sam Houston's current season began on Jan. 6 and ends Apr. 8.

“We have multiple racetracks, so, our contracts cover all our tracks. Everybody was ready to go as soon as there was some change in the status,” said McErlean. “It's literally the flick of a switch to get it going. We welcome the change. Sam Houston's a good wintertime meet on the schedule for a lot of people, and we're glad people will be able to see it live to bet on.”

When asked to comment on the TXRC's actions, HISA spokesperson Mandy Minger wrote in an email: “The Fifth Circuit's decision concerns only the prior version of HISA, before Congress amended it to remedy the constitutional concern the Fifth Circuit identified. No court has expressed any constitutional concern about, let alone enjoined, the current version of HISA now in effect. We look forward to working with the Texas Racing Commission and Texas racetracks should they resume operations falling within HISA's jurisdiction.”

Early last year, the State of Texas and the TXRC joined as intervener plaintiffs on one of the cases before the Fifth Circuit, led by the National Horsemen's Benevolent and Protective Association (NHBPA).

On Jan. 3, the HISA Authority asked for the Fifth Circuit's Nov. 18, 2022, anti-constitutionality order to be vacated based on a federal rewrite of the HISA law in December.

On Tuesday, the Fifth Circuit panel of judges denied this motion and also shot down separate motions for a rehearing of the case made by both the HISA Authority and the Federal Trade Commission (FTC).

After ruling on those two motions, the Fifth Circuit then issued a mandate that stated, “It is ordered and adjudged that the judgment of the District Court is reversed and remanded to the District Court for further proceedings in accordance with the opinion of this Court.”

The Fifth Circuit encompasses the states of Texas, Louisiana and Mississippi.

Cook explained that her policy decision last year to prohibit the export of simulcast signals from the state's tracks was made “hoping for the legal outcome that HISA has no legal jurisdiction in our state.

“We have avoided HISA jurisdiction because we didn't think that regulatory scheme was constitutional as a policy decision, and now we've avoided it in a legal decision as well,” Cook added. “We were certain that we were going to prevail, but I needed to provide certainty.”

Cook wrote in a memo Wednesday to licensees that, “All horseraces in Texas will continue to be conducted in accordance with the Texas Racing Act and the Texas Rules of Racing.”

This means that Texan racetracks continue to operate in a similar position to those in West Virginia and Louisiana, in that they are bound under the state's regulations and not HISA's safety regulations that went into effect in July last year.

With no simulcast signals beamed out of the state for months, concerns have understandably surrounded the impact on purses from a massive drop in handle.

In early January, the Daily Racing Form reported total wagering had dropped from $11.75 million on six days of live racing in 2022 to $1.04 million on seven days of live racing in 2023. The average per-race handle reportedly declined 92.3%.

The TDN's Bill Finley reported that Saturday's handle at Sam Houston for the Houston Racing Festival was $488,385. Last year, when the races were run on a Sunday, the handle was $5,698,052–a decline of 91.4%.

Cook was unable to provide specific figures as to the numerical hit on the state's purse account, but she played down the impact by saying that out-of-state simulcasting at Texas tracks accounts for roughly 15% of the total purses, the latter of which is bolstered by state subsidies and an increased percentage of on-track handle.

“It's not that we don't think [HISA] has an admirable goal, it's the way they're going after the goal,” said Cook, raising alternative uniform regulatory approaches to HISA, like a “cooperative agreement” model.

“It's not personal,” Cook added. “I told Lisa [Lazarus, HISA CEO] that when she came to Texas. I invited her. She came June 8. I drove her round in my pickup truck, and I said, 'It's not personal but you have a problem. You don't have a sustainable resource model here.'”

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First Foal Is A Filly For California Stallion Cistron

Grade 1 winner Cistron sired his first reported foal, a filly out of the Acclamation mare Patriot Missile, born Jan. 30 at Harris Farms.

A fourth generation Harris Farms homebred, she is the first foal from her dam, a half-sister to the Grade 3-placed stakes winner Super Patriot ($371,554).

The second dam, Patriot C H, is a half-sister to the Harris homebred Grade 3 winner Lucky J. H. ($632,065). This is the family of numerous Grade 1 stars including City of Light, Cacoethes and Fabulous Notion.

A stakes-placed winner at two, Cistron won Oaklawn Park 's Northern Spur Stakes at three and graded stakes victories on both dirt and turf at five and six in the Grade 1 Bing Crosby Stakes, G2 Kona Gold Stakes and G3 San Simeon Stakes while earning $768,719 for owner Hronis Racing.

Cistron is one of four graded winners from the first crop of the multiple War Front Grade 1 winner The Factor. He stands his second season at Harris Farms for $3,500 Live Foal.

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