Is The Derby Purse Fair? Opinion From The Industry

In the Sept. 30 edition of the Thoroughbred Daily News, we ran an interview with John Sikura in which he raised questions about the funding mechanism and purse of the Kentucky Derby.

In the article, Sikura says:

“(The Kentucky Derby is) “The single event that drives the commerce of the industry. The point of entry to virtually everybody that owns a horse: 'I want to win the Kentucky Derby.' If you're fortunate enough to do so, there should be a financial reward that recognizes that–not just pride in achievement. A purse of $3 million, with $1 million dollars in fees and nominations, is an embarrassment to the sport. A huge windfall is given to a corporate entity, which they're entitled to. Corporately, they've been brilliant stewards of their brand and stock value. But they have to recognize that they're in a sport that has many participants–and that those should be rewarded.”

We asked several leading industry figures how they felt about what Sikura said, and also asked Churchill Downs, who had not responded by the time of publication of this article.

(To submit a reply of your own for consideration for publication, email suefinley@thetdn.com.)

 

Mike Repole, owner

“I disagree with John Sikura that it's embarrassing that the Kentucky Derby purse is $3 million. It's not embarrassing-it's beyond embarrassing. But not only do we put up a third of the purse with fees, but the way the owners get treated is an embarrassment. We buy our own tickets, and if you want more than 10-15 people, you have to buy your own seats. I have to run second in the Kentucky Derby just to break even. I'm 0-for-8 without a first or second, so every time I'm in it, I end up losing money. I doubt when a team makes the Super Bowl they have to worry so much about accommodations for their friends and family. So it's beyond embarrassing between the purse, and what owners pay to try to share the experience with friends and family. What happens when a syndicate makes it into the race with 30 owners? I think if it's going to be as prestigious as it is, the purse should be $10 million. The Saudi Cup is $20 million, the Dubai World Cup is $10 million, and the Breeders' Cup Classic is $6 million. I also disagree that they should allow 20 horses in the race. It should be 14. We're all concerned about horse safety. Is 20 horses in one gate safe? I don't think it is. This year, I have been blessed by having so much success, and it should be the most fun I've had in racing, but the frustration is starting to overcome the enjoyment. And the more I reflect, the more I'm starting to really realize that the blame of this lies with the owners and the trainers. As long as we keep letting tracks make the rules, and HISA with no real horse racing experience make the rules, and be ruled by the ineffective associations that represent owners, trainers, and jockeys in the sport without really having done them justice, the more we have to look ourselves in the mirror. If they lowered the purse to $500,000, they'd still get 20 horses, and that's on us. There's so much great that can happen in this game, but we're at a crossroads. This is self-inflicted. And we have let this go on for too long.”

 

Elliott Walden, President & CEO, WinStar Farm

“I think the Kentucky Derby purse should be $10,000,000 and the Oaks should be $5,000,000. The Derby has been raised twice in the last 20 years (300%). The Churchill Downs stock price is up over 1900% in the same time frame. I think our real problem is we are too busy fighting amongst ourselves with two horsemen's groups (the HPBA and the KTA), and not negotiating effectively with Churchill Downs as horsemen. It is the way the system has been set up. If I were CEO of Churchill, I would like it that way. Churchill Downs reported they had increased revenues of over $20.0M on last year's Kentucky Derby weekend alone. I am sure their argument would be that we can split up the purses any way we see fit.  I think this is more about having an equitable split on all revenues for the weekend and not just handle.”

 

Eric Gustavson, Owner, Spendthrift Farm

I read John's article. Of course he's right. I remember many years ago when I found out how much it cost to nominate your horse to the Kentucky Derby, should you be among the few to make to the starting gate of that illustrious race. You might think that the nomination would be covered for the lucky 20. But no. I was shocked as I did the math and realized the disproportionate percentage the nominations made up for the purse of arguably the world's most famous horse race, let alone our country's. A Derby purse increase is decades overdue.

Anyone who has ever tried to take a group to Churchill on Derby Day knows the king's ransom it takes just to get seats. Add on the seat licenses, the handle and just that one day alone is quite a haul for Churchill. And good on them! They deserve to enjoy the fruits of their labor, and the blessings that come with owning the premier day in our sport. But, as John stated, they could bump the Derby purse to $5 million tomorrow without batting an eye. That would put it on par with the Breeders' Cup Classic, which should be a minimum. But if you're Churchill, don't you want to be the class of the sport that offers American racing's most stout purse?

The powers that be at Churchill Downs should step up and reward the Derby runners commensurately with their achievement.

 

Kenny McPeek, trainer

There's no question that a race of that caliber, the purse should be larger. Worldwide, it don't think it ranks in the top 25 purses in the world. It's not in the top 25. For me, it's always been a bit of a head scratcher.

 

Tom Ryan, SF Bloodstock

The business behind the Kentucky Derby:

  • $3 million purse
  • 15 million viewers
  • 150,000 attendees
  • 93% hotel occupancy
  • $189 million in wagers in 2023
  • $400 million economic impact

The glaring issue here is the winning owner of the 2023 KY Derby takes home $1.5m after jockey and trainer take 10%.

Based on the current $3m purse, CDI doesn't care to preserve the sanctity of The Kentucky Derby by bringing it into line with the rest of the world. We should have a $10m purse structure with plans to increase incrementally as we evolve.

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Catching Up with 2014 Breeders’ Cup Juvenile Fillies Turf Winner Lady Eli

Lady Eli had a sensational career that got rolling with a Breeders' Cup win at two and culminated with an Eclipse for champion turf female at five. In between, she fought a life-threatening battle with laminitis and captured the hearts of racing fans. She delivered her third foal, an Into Mischief colt, Mar. 6 at Coolmore America and was bred back to Justify.

“The Breeders' Cup is the ultimate race test of champions to define and prove yourself against the ultimate competition,” said Hill 'n' Dale's John Sikura, who now owns Lady Eli in partnership with Coolmore. “That's what everybody dreams of; to win a Breeders' Cup race certainly defines you as a world-class racehorse. As someone who is in the breeding business, presenting a foal from the best racemare is a unique achievement as far as the quality of the dam. There's only one Breeders' Cup winner in each race each year, so Lady Eli is the epitome of class.”

Lady Eli (2012 dark bay or brown mare, Divine Park–Sacre Coeur, by Saint Ballado)

Lifetime record: Ch. turf female, MGISW, 14-10-3-0, $2,959,800

Breeders' Cup connections: B-Runnymede Farm Inc. & Catesby W. Clay (KY); O-Sheep Pond Partners; T-Chad Brown; J-Irad Ortiz, Jr.

Current location: Coolmore America/Ashford Stud, Versailles, Ky.

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Sikura: No Simple Solutions for a Fractured Sport

At a time that so plainly demands leadership, where better to come than the desk of John Sikura? A man of notably independent outlook, the owner of Hill 'n' Dale can be relied upon for a perspective that combines candor and detachment with flair and imagination.

And those are all assets that appear to be in short supply right now. For while our community's emotional response to the traumas at Saratoga this summer was one of shared horror and grief, the polarization of opinion since has been emotive.

Much as we have seen in the political sphere, since the advent of social media, the sport's recent experiences appear to have stimulated increasing resentment and intransigence. On the one hand, some propose radical but relatively simple solutions; others, however, believe our problems are too varied to be tackled other than by diligent increments.
Sikura pleads for less panic, fewer polemics, and more circumspection, above all more coherence.

“The difficulty in every emotional event–be it gun control, abortion, be you liberal, labor, conservative–is that emotion and rational thinking tend to be polar opposites,” he says. “When you see a shocking event, you react with emotion. But there's never a simplistic answer to a complex problem.”

Sikura places the challenge in unflinching perspective. “The unfortunate incidence of catastrophic death in racehorses has remained relatively consistent for more than 20 years,” he notes. “And over the last four or five, we've had a steady decline. Difficult as it is to say in a public forum, unfortunately a horse race is a concussive, high velocity event where everything can happen. A mis-step. A bump turning you sideways at the wrong time. Jumping on heels. The dangers of entering, exiting the gate.”

Little wonder, he suggests, if forensic studies after breakdown clusters have tended-as at Churchill earlier this year-to find no single cause. In fairness, moreover, two dirt breakdowns during the Saratoga meet scarcely qualified as a “cluster.” For both to involve horses in the process of winning a Grade I, in front of the grandstand, was a coincidence that horribly exposed the sport. But Sikura feels that its freakish nature needs to be recognized before any single, sweeping solution is proposed or embraced.

“Not to sound callous, but I believe that if the Saratoga casualties [six others on turf] were 50 percent higher but it was Belterra Park, it would not be front page of the TDN,” he reasons. “You're wracked with emotion because of the connections, Grade I races, Saratoga, everybody's there.

“Ultimately you can never control what day this event happens, what race, what place on the racetrack, who's watching. But from the perspective of an insurance company, they would say, 'We don't know where or when, but some years we must expect clusters of these events.' The reason they will insure barrenness in mares, mortality in horses, all the possible events, is that there's a baseline. Same with insuring properties, hurricane, fire, etc. We may [at a given time] have a higher number of casualties due to cardiac arrest. And then everything gets to a norm, until or unless you can find a drug or a scientific breakthrough that changes everything.”

Sikura recognizes that none of this should discourage us from striving relentlessly to make the sport as safe as possible. The aspiration, naturally, should be zero fatalities. But he reminds us that we can never hope actually to hit zero, because with animals constructed this way there will always be an attrition rate-even per number of foals playing in a paddock. In the meantime, nobody should suggest to Sikura that either the problem or the solution can be simple.

“There are lots of factors that we can look into. Certainly, a study on the ideal racetrack. The ideal amount of cushion. Possibly a new kind of surface that is part artificial, part dirt. It could be that we come up with something that hasn't even been tried before, that is profoundly safer. And the highest level of scrutiny. Pre-scanning. A traveling team could go racetrack to racetrack, make sure that we're doing everything we can to have the surface ideal. I think that definitely we can, should and must do better.”

But even then, he predicts, from time to time something will go wrong. And it won't necessarily be anybody's fault. We will want to point to this or that reason, but many events-most, even-Sikura feels to be random. And, granted that our sport will always contain an element of danger, he finds another oversimplification in the familiar argument that only the humans participate voluntarily.

“You can say jockeys can verbalize their will,” he allows. “But really racehorses do the same, because they're innately bred to have that trait. They want to run, they want to compete, they want to perform much like a hound will chase a fox. We have breeds specifically bred for defining qualities, and I think it's extremist to say that if something goes wrong, it's cruel.”

He offers an example. You buy a German Shepherd puppy. But you read the science, and discover the breed to be susceptible to hip dysplasia.

“So you have the joy of the animal, the love of the animal, they're a family member, they can be a protector, many things,” Sikura says. “But when they turn 12, and they have hip dysplasia and can't get up, and everybody's crying, and you're taking your dog to the vet, is the breeder somehow immoral or inhumane for breeding that dog?”

Sikura sees that inborn sense of vocation in all Thoroughbreds, from the moment they wobble onto their feet. But here, presumably, his professional peers would find easy consensus. The differences arise from how we best deploy these instincts. And here is where the sport's governance exasperates Sikura.

“Who's in charge, who's funding, and how do you put it together?” he asks. “Our 'organizations' all have the opinion that certain things are under their purview and they should be in charge. If you have a conundrum that seems to have no solution, it's folly to get the same group of people to study the issue. It takes an independence where, real or perceived, you can't have prejudice. Where they won't say, 'Well, this will cost too much,' or 'What about the shareholders?' Just unbiased, well-paid professionals.”

But even if such people produced recommendations, who would decide on their adoption?

“We're a Rubik's Cube with one square taken out,” Sikura says. “So it can't be solved under our fragmented, disorganized, parochial, backyard mentality. If an outsider came in and took over the business, many of these organizations would be eliminated as either inefficient or redundant. The others would be governed in such a way that each had a specific task: public relations, humane treatment of racehorses, media source, sponsorship.”

Sikura has two axioms on power. “One, nobody voluntarily gives it up,” he says. “Two, you're never doing a bad job when you're in charge.”

The outsider just mentioned would look at the metrics and conclude that the sport, under the current dispensation, is diminishing. But who, Sikura asks, will sacrifice the narrow interests of their own sector to create the kind of rising tide that might eventually float all boats? As things stand, he complains, people will confine themselves to asking, “Did I improve handle at my meet?” or “What is the yearling average of my stallion?”

“You can't have direction without directions,” Sikura says. “Say someone has a bold idea. Say I did a paper and spent six months on it, and I can't wait to talk about it, I'm so excited. The biggest challenge would be who do I bring this to, and can they do anything about it? The answer would be, 'I don't know' and, 'No, they can't.' It's eternally frustrating. So there's innovative guys, billionaires, some of the brightest entrepreneurs in America-and therefore the world-that have contributed no intellect, no ideas, no participation because they felt frustrated.”

Any major change has duly had to overcome fierce factional opposition: the Breeders' Cup, now HISA. Even the Breeders' Cup, perceived as a triumph, is not what Sikura feels it might be: its purses stagnant, international engagement extremely uneven. And then there's the showpiece itself, the Kentucky Derby.

“The single event that drives the commerce of the industry,” he declares. “The point of entry to virtually everybody that owns a horse: 'I want to win the Kentucky Derby.' If you're fortunate enough to do so, there should be a financial reward that recognizes that-not just pride in achievement.

“A purse of $3 million, with $1 million dollars in fees and nominations, is an embarrassment to the sport. A huge windfall is given to a corporate entity, which they're entitled to. Corporately, they've been brilliant stewards of their brand and stock value. But they have to recognize that they're in a sport that has many participants-and that those should be rewarded.

“In the NFL, players are paid to measure with their ability. There's revenue-sharing. Things are done recognizing that the league has to prosper and succeed. The best teams can have high ticket prices, etc., but everybody needs to be a part of it. Yet participants in our industry, the people that provide the product, put on the show, are effectively minimum wage workers. The money is here from the historical racing. Instantly, the Derby can be $5 million; the Oaks $2.5 million. Instantly. Should be $10 million and $5 million. And it doesn't even have to come out of their pocket. It's a redistribution of KTDF funds, the money's there.”

He invokes the example of Ron Winchell at Kentucky Downs.

“Look at what they give away!” he exclaims. “They give millions of dollars to other tracks. They can't count the money. People don't think that purses are a huge part of this, everyone talks about the pageantry and the mornings and how great it all is. I don't diminish any of that. But when nobody would race at Turfway Park or Ellis Park, and now you can't get in, is it a mystery why?”

Those tracks, of course, are under the same ownership as Churchill Downs.

“Again, I'm not critiquing the way they run their business as a 'business',” Sikura stresses. “But they've made a lot of money off the horseracing industry. Hollywood Park, shut down and sold. Arlington, shut down and sold. Calder. So I think they have a responsibility and their bottom line, it's nothing. Nothing. It's like leaving a nickel tip. Not even. A penny falls out of your pocket, you're in a hurry, you just leave it there.”

And if it's human nature never to surrender more than necessary, Sikura feels that the case for doing so will never even be made by so fractured a sport.

“I think an open-minded evaluation by the other side would have to agree with you,” he says. “But we have this perfect conundrum of no rules, no uniformity-the fragmentation that is always great for an opponent. In fact, the game never takes place, because one side is too disorganized even to schedule a date.”

Characteristically, Sikura's freethinking, freewheeling mind has taken us far from our opening challenge. But that's precisely because the moral interdependence of the sport's many dimensions is not matched in its structure.

“We only consider these things when there's a crisis,” he says. “But for me, the big crisis is a shrinking of the industry. And there are so many positives: healthy markets that now offer great purses, attendance, excitement. We have to find an equitable way to support places that aren't going as well. Like California. They're one racetrack closure away from being out of business. Socially, horseracing would either be neutrally or negatively interpreted by the majority of people there. You have Golden Gate being sold. You have small fields. You have land that's worth a tremendous amount of money. So what can we do, as an industry?”

The Kentucky scene is thriving, but that took work, campaigns, legislation. “It's a great example of how you can make things happen, with determination and especially unity,” Sikura adds. “But again, if all you're concerned about is what's happening to you, today, California doesn't even enter your mind. It should.”

As it is, California is in a vicious circle: fields drop, handle drops, purses drop, shippers drop, fields drop further. So Sikura asks whether we could we trim, say, $3 million from Kentucky purses-so that maidens were $105,000 rather than $120,000-and put that into Californian graded stakes? Would that prompt a Californian investor to buy a yearling? Who knows? But what we do know is that only he is asking.

In time, he predicts, all Grade I races will be slots-funded. But he feels that the sport would be drastically eroded without sturdy coast-to-coast bookends in New York and California. By now, admittedly, past mistakes in California can't be repaired. “I don't know where everybody was when these bills were being passed, but here we are,” Sikura says with a shrug. “Without some Indian participation, racing's going to have to survive being racing. And a lot of people would say, 'Well, that's the way it should be.'”

So could Horse Racing LLC, non-profit, buy Californian tracks?

“It's a free country,” Sikura replies. “Whether you could do that on terms at which you could operate racing and fund the debt, I wouldn't know. I think Golden Gate is a pretty strong message on the economics: that the return on investment needs to be better. Without saying it in words, that action tells me that Santa Anita is the next consideration. Somebody offers $1.2 billion? I believe that deal would get done. Is there a way to develop the property, keep racing? Smarter people than me would have to evaluate that. But you can't just have a patient on life support. You need a quality of life. So you need racing to thrive.”

And, by a bitter irony that brings things full circle, it is actually California that has shown the rest of the industry the way in terms of breakdowns. Not so long ago, those now announcing domesday were doing just the same at Santa Anita. But backstretch resistance to new protocols was overcome and Santa Anita and Del Mar, without waving some magic wand, have achieved exemplary outcomes at astonishing speed. Arguably the rest of the industry has not adequately acknowledged a debt of gratitude for this, and will only do so if more people start to think along the same lines as Sikura.

“We don't want our money transported,” he says. “But then if you thought about it long and hard, that money, was it really ours? No, it's people pulling a handle.

“Everybody is just here to reap as much as they can. If you operate a nursing home, you could make the sheets thinner: there's higher profit. But you look at the racetrack environment. You have animals, you have people living on the backside, you have van drivers, you have a lot of good people that are part of it. I think they all have to be recognized. It's not just about the head guy: how much he can eat, and what he has left over, he throws in the garbage. It might sound like I'm half-crazy. But I think that mentality flows down to everything, in every business.”

Well, if this is what it sounds like to be half-crazy, then that can't be because the rest of us are sane. If anything, in fact, “half-crazy” might well represent major progress on where we are right now.

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Tyson Keeps Punching In Seagram Win

Never off the board in his four prior career starts, Tyson (Tapit) avenged his sole defeat–a third behind Treason (Constitution) in the GII Eclipse S. June 4–with a win last time out over that rival in the GIII Dominion Day S. July 1.

Heavily bet down to 2-5 going for his second straight graded-stakes win, the 4-year-old wasted no time going right for the lead and assumed command a path off the rail ahead of Carrothers (Mshawish). Always under a wrap by jockey Rafael Hernandez, Tyson was briefly headed as he faced pressure up front from that same rival as the opening half went in :49.88. The top pair raced in tandem around the far turn but the grey had another gear left to find and, when roused at the furlong marker, easily dispatched Carrothers and quickly put open lengths on him to hit the wire much the best.

“He's a really nice horse,” said Hernandez. “[trainer] Josie [Carroll] told me, 'Raffi, just play it by ear. It's a small field, just see what happens and try to give a good race to the horse.' He'll do anything you want him to do. He showed up today.”

“It's one of our best pedigrees, one that we've cultivated for more than 30 years,” added owner/breeder John Sikura. “I have great admiration for Mike Tyson, and I thought this is a special horse, so I wanted to name him Tyson. Wonderful horse, beautifully bred and I want to thank everyone at the farm for the great job they've done, and Josie, for being a magnificent trainer and holding this horse together and getting him on the right track. It looks like he's going to be a champion.”

Pedigree Note:

Out of a winning full-sister to both GI Hollywood Starlet S. winner Streaming and SW Treasuring, Tyson counts MGSW Cezanne (Curlin), GSW/G1SP Arabian Hope (Distorted Humor), and recent GI Belmont S. hero Arcangelo (Arrogate) as members of his extended family under just his second dam. Third dam Better Than Honour is responsible for a pair of Belmont S. winners in champion 3-year-old filly Rags to Riches (A.P. Indy) and Jazil (Seeking the Gold) along with GSW/G1SP Casino Drive (Mineshaft) and GSW/GISP Greatest Honour (Tapit). Honouring has not produced a live foal since reporting a full-sister to Tyson in 2021 but did visit leading general sire Into Mischief for the 2024 season.

https://twitter.com/TVG/status/1685394111720001536?s=20

Saturday, Woodbine
SEAGRAM CUP S.-GII, C$178,850, Woodbine, 7-29, 3yo/up,
1 1/16m (AWT), 1:43.26, ft.
1–TYSON, 124, c, 4, by Tapit
      1st Dam: Honouring, by Smart Strike
      2nd Dam: Teeming, by Storm Cat
      3rd Dam: Better Than Honour, by Deputy Minister
($250,000 RNA Ylg '20 KEESEP). O/B-Hill 'n' Dale Equine
Holdings Inc (J G Sikura) & Stretch Run Ventures LLC (KY);
T-Josie Carroll; J-Rafael Manuel Hernandez. C$105,000.
Lifetime Record: 5-4-0-1, $225,205. Werk Nick Rating: A. Click
for the eNicks report & 5-cross pedigree. Click for the free
Equineline.com catalogue-style pedigree.
2–Carrothers, 122, g, 5, Mshawish–Queenofperfection, by Arch.
($125,000 Ylg '19 KEESEP). O-Mad Dog Racing Stable; B-Siena
Farms LLC (KY); T-Martin Drexler. C$35,000.
3–Artie's Storm, 122, g, 5, We Miss Artie–Tiz Stormy Now, by
Tiznow. O-Buttigieg Training Centre; B-Sunrise Farm (ON);
T-Paul M Buttigieg. C$23,100.
Margins: 3, HF, 4HF. Odds: 0.45, 4.00, 14.25.
Also Ran: Clear Destination, Kingmax (Ire), Seventyseven Stone.
Click for the Equibase.com chart and the TJCIS.com PPs.
VIDEO, sponsored by FanDuel TV.

 

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