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Turf Paradise to AZHBPA: Let’s Race, But First Return Money

Turf Paradise is proposing to host a live meet next year that will run Jan. 2 through May 1, according to a letter from Turf Paradise general manager, Vince Francia, to the Arizona horsemen dated Thursday.

Turf Paradise had previously announced that it had cancelled its 2020-2021 race meet due to health fears associated with operating a live meet during a global pandemic.

For the proposed meet to go ahead, however, Turf Paradise management listed in the letter a number of caveats, namely that $2.1 million of disputed purse account monies be returned to Turf Paradise, and that the Arizona horsemen form a new representative organization or for the current Arizona Horsemen’s Benevolent and Protective Association (AZHBPA) board members and their executive director to resign.

These purse account funds have been the latest bone of contention in a long-running dispute between Arizona horsemen and management of Turf Paradise. Francia previously told the TDN that these funds contractually belong to Turf Paradise for the horsemen that race there.

The horsemen, however, argue that they ultimately wield control over the purse account, as per a prior arbitrated settlement. Indeed, earlier this week a widely circulated email stated that the AZHBPA has secured a good chunk of this money and placed it into a trust to pay purses if and when racing resumes elsewhere.

But Thursday’s letter states that the “first condition” for the proposed meet to go ahead at Turf Paradise is that the “$2.1 million” that was transferred be returned to the horsemen’s purse account at Turf Paradise.

“That money does not belong to the AZBBPA or to Turf Paradise,” the letter states. “It belongs to the horsemen who are racing live at Turf. Without that money being transferred back into the horsemen’s purse account, Turf would not be able to host the proposed race meet. It has been publically stated by AZHBPA President Bob Hutton that, ‘they [the funds] will be used only for purse money for whatever track that wants to run a live meet!'”

The “second condition” of a meet at Turf Paradise is that the Arizona horsemen form a new group that represents a “majority of horsemen at Turf Paradise,” and represent the horsemen’s interests in live racing and simulcasting at Turf Paradise. According to the letter, the new group would have to elect a board of directors, including a president and officers, and create by-laws.

The letter also states, however, that another “quicker way” to accomplish this goal would be for the current AZHBPA board members and their executive director to resign their positions, “making room” for a new board and executive director.

As per the letter: “Recently the AZHBPA and Turf Paradise agreed to terminate the current contract between us. A new contract will be needed between Turf Paradise and the new horsemen’s group.

“Suffice it is to say, both Turf and the AZHBPA have tried to resolve their differences. But with the transfer of Turf Paradise horsemen’s purse money into an account by the AZHBPA–without advising Turf management–there is no point in further dialogue or negotiations between the two of us.

“Time is of the essence. There is a lot that Turf Paradise and the horsemen need to do so that we can open racing on Jan. 2. This also includes Racing Commission approval of the proposed live dates. To get this done everyone is going to have to move quickly.”

National HBPA president Leroy Gessmann re-stated the AZHBPA’s position that it ultimately controls the purse account, and that the money is intended for whatever facility conducts a live race meet in Arizona.

“If Turf Paradise wants to run a live meet, all they’ve got to do is apply for live dates, meet the safety standards set forth by the commission, and we will provide them with the purse money,” said Gessman.

When asked about the second condition in the letter–the formation of a new horsemen’s group–Gessman responded: “I don’t know what to say about that-the HBPA is the one that holds the purse money.”

The HBPA is also the horsemen’s recognized group, he added, “not only at Turf Paradise but according to the state.”

Gessman also cast doubts over the sincerity of the proposed race-dates in the letter. “All [Turf Paradise owner, Jerry Simms] is trying to do is keep his OTB system intact,” said Gessman. “He’s not trying to run a race meet.”

According to Francia, however, the change in heart concerning the operation of a live race meet this ensuing winter has been brought about by concerns for the Arizona horsemen.

“The horsemen have wanted and needed a place to race during the winter,” he said. “The pandemic hasn’t gone away–

we’re well aware of that, and we’re going to have to deal with that.”

When asked about his request for the horsemen to form a new group to represent the horsemen’s interests, Francia said that it’s an effort to break the intransigence in ongoing negotiations between the two entities.

“Personally, I’ve known Mr. Simms for 20 years–I’m his good friend as well as his employee,” said Francia. “I am just exhausted and disheartened by this negative energy that has been directed towards him by this board.”

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AZ Breeders: ‘No Future’ Without Commission Help to Kickstart Live Racing

Thursday’s Arizona Racing Commission (AZRC) meeting opened with the chairman Rory Goree asking stakeholders to “refrain from discussing anything” related to a controversial appeal over who controls purse account money that is scheduled for the October meeting. And it ended with Turf Paradise owner Jerry Simms apologizing for the frustration the state’s Thoroughbred community feels over his decision not to incur liability by running a 2020-21 meet during a pandemic.

In between those brief, book-ended statements that define the currently closed status of racing in Arizona, commissioners heard a slew of impassioned pleas from breeders, owners, and trainers all desperately imploring the AZRC to take some form of action so that live racing can get back up and running in the state for the first time since March.

Last month, Turf Paradise withdrew its request for a traditional autumn-through-spring meet, citing COVID-19 concerns. Arizona Downs months ago called off its summer race meet after failing to secure permission top open from local health officials. Beyond the pandemic, a prolonged fight over off-track betting (OTB) privileges, simulcast signals, and how the horsemen’s purse money can be used has been batted back and forth in the courts and during commission meetings, clouding the future of the state’s two commercial tracks.

“Anybody sitting within the Arizona breeders has seen the value of their horses drop 50%-plus, with no place to run our horses in-state,” said Kevin Owens, a board of directors member of the Arizona Thoroughbred Breeders Association. “There’s a couple of big farms and there’s a lot of people who have people who have ‘backyard’ horses that count on Arizona as a state to facilitate a racing facility to bring these Arizona-breds to track. I don’t know what’s going to happen. I would certainly hope the commission is getting behind Arizona Downs to try to assist them in any way possible to get their meet open [and] operating.

Owens was referring to the possibility of Arizona Downs taking on some winter race dates, an idea that is feasible but depends in part upon the yet-to-be-decided status of the purse account.

“We have no future,” Owens continued. “We’ve been destroyed in this business. Our studs aren’t worth anything. We have a sale coming up [Nov. 19], that by all potential is going to be a bloodbath. We are continuing with our sale, [and] I would encourage the commission to maybe show up at the sale and see what we’re about. We haven’t had much interest from you guys in actually getting into our business and seeing what we do and what it costs to sponsor a sale like this and raise a bunch of horses.

“We’ve given more than one chance to Turf Paradise, and it’s time to move on. There’s been no good faith put forth by that facility at this point, and I believe that we should put everything that we have behind Arizona Downs, as it seems like they are the only ones that are going to have a chance to survive in this state. We need to go forward with an entity that’s concerned with the racing public, the horsemen, and the breeders.”

Breeder, owner and trainer Stacy Campo told commissioners that, “We really need this to happen. I have 18 horses ready to go into training immediately. Twelve of them are Arizona-breds. And you know, we’ve worked very hard to be able to sit here and be the backbone of racing in Arizona. And I hate to say it, but the breeders in Arizona are the backbone. We do supply the stock [and] we need to get live racing. Arizona Downs can do it. I’ve got the horses and the supply to go up there and run.”

Cynthia George, who said she is an owner, trainer, pony person, and exercise rider, underscored that, “the time is critical, because people can’t hold on much longer. Many [out-of-state] meets are coming to a close, and we all need a place to go…. If there’s [an in-state] track available, we need to open.”

Owner Freddy Alvarez added that, “Arizona Downs is the future for the horsemen. We need a place to go. We own 12 horses…. I know [the commission does its] best, but all it takes is a couple of eyes at Turf Paradise to see there’s nothing going on there,” with regard to reopening in the conceivable future.

Robert Hutton, the president of the Arizona Horsemen’s Benevolent and Protective Association, said that, “the horsemen of Arizona are not looking for handouts, but only the opportunity that is offered when a live meet takes place…. It is time for this industry to move forward without the constant distraction that has hindered us for years.”

Not a single one of the 10 horse community members who spoke at the meeting expressed constructive or encouraging sentiments for Turf Paradise over Arizona Downs.

Yet despite all the support thrown behind Arizona Downs, Tom Auther, an owner and partner in Arizona Downs, said he had “nothing to report” in the section of the AZRC agenda devoted to updates from the tracks.

Jerry Simms, the owner of Turf Paradise, did have something to say during the public commentary period after most of the horse community members had spoken. He began by saying that he understood their frustration, but that he felt like he was in a “no good deed goes unpunished” position.

Simms said he has been involved in the Turf Paradise ownership for 20 years, and that the track has been operating at a “huge negative” in recent years.

“The track owes me $8 million. And there hasn’t been a distribution since 2005. But I was happy—and am happy—to continue doing that,” Simms said.

But then, Simms added, COVID-19 changed everything.

“I made the decision that I didn’t want to have the liability,” Simms said. “There are many lawsuits out there where people are suing, and claiming that [business owners are negligent for operating in a pandemic]. And it was a difficult decision for me to make. But we sat down with my top management and realized this is what we had to do. We just didn’t want the liability of putting people in that kind of risk. But I completely understand the frustration that the folks have had. I’m sorry about that part. That’s all.”

Although no immediate lifeline for the return to live racing was proposed by the AZRC, Goree said that moving forward, his organization needs to “start looking at what the requirements are regarding live racing versus having an OTB. I would just want the department to maybe start looking at that and report back to us as to what powers we may have regarding if [a licensee is] not offering live racing [but still operating] OTB networks.”

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Turf Paradise, Arizona HBPA Continue To Dispute Settlement Agreement, Winter Meet Cancellation

The following letter was written by Arizona HBPA president Bob Hutton and posted on social media on Aug. 15, following Turf Paradise's announcement that the track would not host a live racing season this year due to the ongoing coronavirus pandemic. Below Hutton's letter is a response from Turf Paradise's general manager Vincent Francia, posted on the track's website on Aug. 17.

TO: HBPA MEMBERSHIP
FROM: PRESIDENT BOB HUTTON
DATE: August 15, 2020

As I am sure everyone is aware, Turf Paradise announced Thursday at the Arizona Racing Commission Meeting they are not running a race meet in 2020 / 2021. This is not a big surprise to me. As you all remember, when we fought last year to keep the track open till May 10th, Jerry Simms stated to all trainers they should take everything with them, do not leave anything behind, including walkers and pens. That was my clue that there would not be any more racing at Turf Paradise. At the commission meeting I stated no permittees will benefit from OTB revenue after the current signed consents for simulcasting have expired! No new approvals for signals will be signed if there is no live racing!

The HBPA has made numerous attempts to engage Turf Paradise in resuming negotiations to successfully run the 2020 / 2021 meet. It was obvious Jerry Simms had no intention of running a race meet, when for the most part the meetings deteriorated quickly once threats of lawsuits were thrown out in the direction of the HBPA Board members.

The arbitration settlement in October of 2019 resulted in the following changes: 1. The OTB split changed from Turf receiving a 60% / 40% split to 52% / 48%. 2. The advertisement contribution from the HBPA was reduced from $400,000 a year to $150,000 a year. 3. It was established that the purse money was the property of the Horsemen, and the purse account was to be in a HBPA controlled trust account, not in a Turf Paradise account. I believe once this happened Jerry Simms made the decision to close the track. The Covid 19 pandemic was just a convenient excuse.

I want all of you to know that in our most recent discussions with Turf Paradise, the Boards number one concern was to avoid the unprofessional behavior that we experienced in March of 2020. The HBPA could not in good conscience inform its membership they could return to Turf Paradise without some guarantee that the race meet would be run in its entirety. Jerry Simms refused to give that guarantee.

During the time that we were on the backside from March 14th till May 10th Jerry Simms charged the HBPA to keep the backside open for the horsemen. Although the HBPA Board did agreed to contribute to 50% of the expense, they were led to believe that it would be approximately $7,500 a week for the HBPA's portion. Jerry Simms then made the HBPA pay a security deposit of $20,000 up front or horseman would have been evicted on March 28th. Not wanting to have everyone evicted on March 28th, we were forced to pay the deposit and sign the agreement to stay. When we starting receiving the weekly bills instead of being charged $7,500 a week, Jerry Simms charged us anywhere from $13,000 to $15,000 a week for a total of $121,162.70. This was almost double what we were told was the estimate. The HBPA filed a grievance in May 2020 with the board of stewards asking for a refund. As of today, we have had no response.

As I stated above, in October 2019 we went through an arbitration with Turf Paradise. As a result of that arbitration it was ordered by the arbitrators that purse money is the property of the HBPA and is to be held in a HBPA trust account, not in Turf Paradise account. Despite several requests throughout the year by the HBPA to have the money moved to the HBPA trust account Jerry Simms has continued to refuse to comply. Again, we filed a grievance with the board of stewards to get this money released to the HBPA's trust account. As of, today we have heard nothing from the commission. We currently have $1.8 million in Turf Paradise's purse account, that he will not move to the HBPA trust account. This purse money belongs to the Arizona Horsemen to be used for a 2020 / 2021 fall and winter race meet in Arizona.

I know these are scary times and I do not want to give anyone any false hopes. However I want everyone to know we currently are having negotiations with other permittees to run a fall and winter race meet. The Arizona HBPA is committed to year around racing and will continue to work with other track owners who may want to come to the Phoenix area! I would like to thank those who have supported the HBPA in their efforts to provide the horsemen in the state of Arizona with a racing venue you deserve! Year around racing in Arizona is our GOAL!

Following is Vincent Francia's response:

Dear Horsemen,

This letter is written to respond to a post written by Mr. Bob Hutton, President of the AZHBPA that appeared on Facebook on August 15. This letter is written to clarify some of the statements and impressions in Mr. Hutton's letter. In other words, to set the record straight.

Mr. Simms has owned Turf for 20 years; 19 of those 20 years race meets were successfully conducted, from beginning to end. It's only this year, specifically when Governor Ducey declared a state of emergency on March 11 because of the Coronavirus that a race meet has
been cut short. The Coronavirus is the only reason Turf cut short its race meet on March 14 and the only reason Turf withdrew its request before the Arizona Racing Commission on August 13 to run a race meet from Nov. 1 to May 1, 2021. Turf does not want the liability of running a race meet while the Coronavirus is active.

Settlement Agreement (Attachment 1)

The Settlement Agreement was written by Mr. Casillas, Director of the Arizona Division of Racing, who also served as the mediator for Mr. Simms and Mr. Hutton as the two men compromised, negotiated and eventually signed the agreement in good faith on March 22.
Either side could have argued specific points of the agreement or declined to sign the agreement. But both sides agreed to sign. Read Attachment 1 for the complete terms of the agreement.

In his posting Mr. Hutton gives the impression that the Settlement Agreement, which by definition is to settle differences between parties, was somehow arrived at without the consent of both parties. On the contrary, both Mr. Simms and Mr. Hutton signed the 14 point
agreement. For example, the parties agreed to split the costs < 50‐50 > of maintaining the backside and training on the man track for 45 days. The AZHBPA was invoiced weekly and the invoices were promptly paid. When the 45 days expired the AZHBPA asked for an additional 10 days, at their own expense, and the request was granted.

It appears that Mr. Hutton's personal feelings toward Mr. Simms and Turf are clouding his judgement. The HBPA is to be neutral, treating all tracks equally, but Turf is treated differently. When Arizona Downs abbreviated their race meet they continued to simulcast without racing live. When that track announced that it would not be able to conduct a meet because of Yavapai County and the City of Prescott Valley's concerns about the Coronavirus, Arizona Downs, without objection from the AZHBPA, maintained their simulcasting and OTB system.

Why not the same for Turf?

Arizona Downs Letter (Attachment 2)

On May 22 Turf became aware of a letter from Mr. Dave Auther of Arizona Downs to Mr. Casillas. Specifically what caught our attention in the letter was the following that revealed how Arizona Downs was going to fund its purses: “This will include a contribution from the HBPA
toward purses. HBPA has a plan to secure purse money from the Turf Paradise purse fund.”

You cannot use the purse money of one race track to subsidize the purses of another track.

Mr. Hutton stated that without live racing there would be no simulcasting. Turf's contract with the AZHBPA goes until May 2021. Turf expects the AZHBPA to honor that contract.

At a meeting in early August with Mr. Hutton and two members of the Arizona Thoroughbred Breeders' Association in my office at Turf, Mr. Hutton asked me if I believed a contract existed between Turf and the AZHBPA. I replied in the affirmative that I believed a contract existed between us. Mr. Hutton then asked Mr. Simms (who was participating by phone) the same question. Mr. Simms answered that he not only believed a contract existed but that it was in effect until May 2021. Mr. Hutton responded that he did not believe a contract existed because we cancelled the race meet due to the Coronavirus, thus rendering the contract void. Mr. Simms then asked Mr. Hutton that if he really believed that, then why are we having a discussion about contractual matters. Mr. Simms then said, “Let's continue to talk.” Mr. Hutton then stood up abruptly and said “We're done,” and left my office.

The abrupt ending of the meeting notwithstanding, Turf has never declined a phone call, an email/ text or a request to meet with the AZHPBA. That door is still open.

Sincerely,
Vincent Francia
General Manager

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