NJ Commission ‘Politely Declines’ to be HISA Middleman

The New Jersey Racing Commission voted 6-0 Wednesday not to act as a middleman on behalf of the Horseracing Integrity and Safety Act (HISA) by collecting fees from state licensees that will eventually fund the yet-to-get started authority's drug-testing and safety initiatives.

The decision was hardly a surprise, and it yielded zero public discussion among commissioners prior to the perfunctory vote.

It had seemed unlikely that the NJRC would be the first regulator in the nation to willingly craft a complex set of rules and set up a payment-collecting process from scratch to fund a work-in-progress ruling body whose July 1 start date looms in the shadow of two federal lawsuits aiming to get HISA voided on constitutional grounds before its programs even go into effect.

Judith Nason, the NJRC's executive director, said at the Mar. 23 meeting that the HISA Act authorizes its authoritative body to impose fees on “covered persons” to pay for anti-doping and safety programs, and that those fees will be calculated on a yet-to-be-determined, proportionate, state-by-state basis depending on how much racing takes place in each state.

Also under the HISA law, Nason said individual state racing commissions may elect to collect the HISA fees from that state's industry participants and then remit those fees to HISA. But if a state commission wants to opt in on that process, she added, it has to notify HISA by May 1.

Nason noted that it would be up to each opting-in state to come up with its own method of assessing and collecting fees from licensees. And since New Jersey currently has no statute, rule or contact in place that spells out that process, the commission would have to go through the difficult work of proposing its own system—which would never happen in time for the May 1 opt-in date, based on how long it takes to get rules passed in New Jersey, Nason added.

Nason told commissioners prior to the roll call that the NJRC staff recommended that the commission vote not to collect the fees. The vote was then unanimous to follow that recommendation.

Although the commission's vote doesn't change a thing in the way it does business, the NJRC now at least has it on the record that it didn't want to be the bill collector for a program that is being opposed by several other state racing commissions and the National Horsemen's Benevolent and Protective Association in two similar but separate lawsuits.

No New Jersey commissioners articulated their views on what might happen in the near term regarding HISA. But Nason did shed some light on the process when prompted during the public commentary portion of the meeting after the vote.

“It's really up to HISA to figure out how they want to assess the racing industry. And the question for the NJRC was whether we wanted to insert ourselves in that process. And we politely declined,” Nason said.

Responding to a follow-up query, Nason added that it's unlikely New Jersey licensees will be hit up twice at some point in the future to pay for drug-testing costs (as in having to pay once to the NJRC, then again to HISA during the same time frame).

“Pursuant to state statute, the NJRC can assess permit-holders for our racing costs,” Nason explained. “When HISA gets up and running, once they take over an issue such as the anti-doping and medication control program, they will be able to bill the racing licensees for their costs, and the NJRC will be pre-empted—we will not be able to bill. So it will be a shift from the permit-holders paying us to however HISA wants to collect those fees directly from the racing industry.”

Fall dates swap

The NJRC also voted 6-0 to approve the change of two 2022 Thoroughbred dates from the Meadowlands to Monmouth Park.

What would have been the final two programs of the all-turf Thoroughbred meet at the Meadowlands (Friday and Saturday, Oct. 28 and 29) got swapped out for two additional Sundays at Monmouth (Sept. 11 and 18), the latter of which will be the new closing day of the meet. The request was made by Monmouth's management.

Thoroughbred racing at those two Jersey tracks will get a nine-date boost this season compared to 2021.

Monmouth's opening day is May 7 for the 62-date meet. The nine-date Meadowlands grass meet begins Sept. 23.

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Campbell: Give New Jersey Riding Crop Reform A Chance

When it comes to the New Jersey Racing Commission (NJRC) and their restrictive riding crop rules at Monmouth Park, horse people, jockeys, owners, bettors, turf writers, and anyone remotely interested in the future of this great sport needs to be supportive of what they are doing. Furthermore, let's give executive director Judith Nason, the benefit of the doubt that she and the commissioners on the regulatory agency are dutifully representing the varied interests of everyone involved. In other words, allow them at least a chance to succeed or fail.

Last week, in the wake of a pair of jockey suspensions at Monmouth for use of the riding crop during two different races, Paulick Report publisher Ray Paulick stated in a tweet that the ruling against Carlos Montalvo suggests that there are no exceptions to the “safety only” crop rule. He went on to say that jockeys in the state may as well “leave their whips at home.” Though he is a longtime advocate for whip reform, I respectfully disagree with Paulick's assertion because it implies that the NJRC has no flexibility when it comes to interpreting their own rules. They do. This is, in the opinion of this turf writer, too critical. Here's why.

Almost immediately, most who have viewed Race 1 on July 11 sought to offer their own perspective concerning Montalvo's mount, M I Six. The story expanded quickly, as it was entered into the jockey's testimony in front of the NJRC board of stewards. According to eyewitnesses, the longshot gelding was “uncontrollable” and about “to bolt,” even on his way to the starting gate. The jockey can be seen whipping M I Six down the backstretch, in what he viewed as necessary to defusing danger. The stewards begged to differ, deciding that Montalvo had violated the whip rule. His fate was a five-day suspension that begins in late August, plus a $500 fine. His attorney said they are planning an appeal.

Whatever you think was proper and just about that decision or not, herein lies the issue when it comes to opinions like these: let's leave the adjudicating to the professionals. In this case, it's the NJRC, tasked by the attorney general's office. to oversee the sport, that made the progressive decision to institute the most radical and wide-spread change in American racing history. They didn't do it on a whim, and their outline for its implementation can be found clearly on its website (https://www.nj.gov/oag/racing/rulemaking/Riding_Crop%20Proposal.pdf). Executive director Nason is a seasoned veteran, and an attorney, who cut her teeth in the legal avenues of New Jersey politics. She is in charge of a monumental task that is at hand. Some latitude needs to be given.

Sure, more specifics would be beneficial, as no one would dare say, “No thank you” to that. But the business that stewards and rule-makers engage in implies a certain closed-door mentality. Despite the public office, this is especially true when you are hammering out a revolutionary set of policies that are quite possibly going to be wildly unpopular. In N.J.A.C. 13:70-11.12(a), the commission is clearly attempting to be thoughtful when it comes to changing the culture of riding crop use, stating that “jockeys and exercise riders will need to encourage horses by means that do not involve actual or perceived harm to the horse.” That word “perceived” is absolutely key. Use of the riding crop to encourage a horse to run faster, according to them, “is no longer in the best interests of the sport.” This isn't just about “safety only,” it's also about change. And change is hard.

Speaking of tough moments, Monmouth Park and the NJRC were given a true test of its rules on what is without question its greatest moment — Haskell Day. Everyone held their collective breath when Paco Lopez went down after his mount, Midnight Bourbon, stumbled badly after clipping heels with Hot Rod Charlie in mid-stretch. Conjecture, spun and spun, with many asking: Would the whip have helped?  We will never know because jockey Flavien Prat aboard Hot Rod Charlie did not choose to apply it, and to make some sort of judgment either way is pure speculation. It is in the hands of the NJRC, as they plan to hold a hearing, which is part of their process.

Again, let's allow that to play out, too. Though no jockey or horse was seriously hurt, praise be, it is just another example of how dangerous this sport truly can be. Whip or no whip, accidents happen on a racetrack. But there is much more to the story than just that. It is insanely more complex.

Recall, there is no precedent for this rollout: no guidebook, no primer. The NJRC, led by Nason, is attempting to do something important – bring Thoroughbred racing into a new era. That is no small task on a case-by-case basis, and the NJRC certainly has a network of interests to please. Don't forget that, either.

During the NJRC's July meeting last week, Dennis Drazin, the chairman and CEO of Darby Development, which operates Monmouth Park, asked Nason for clarification concerning what constituted a “dangerous situation.” That's not a poor ask, but this is a question of empowerment. The NJRC holds it, make no mistake, and letting the unfolding of explanations, appeals, and changes over time play out is a necessary part of this evolution.

This isn't a “safety only” crop rule; rather, it is meant to revolutionize a sport that, by the way, has an image problem when it comes to the public's imagination. As for Flavien Prat, his fate lies in the hands of the stewards, as it should. These are the trials that are necessary when we are talking about something that is overdue, like crop reform. Safety is not all that is at stake, as perception is also present. That is why the whips cannot be left at home, and the reason why all of us need to back NJRC. Give them some room, then we can be more critical.

J.N. Campbell is a turf writer with Gaming USA. His work can be found at www.horseracing.net/us.

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New Jersey Fixed-Odds Pilot Program Cleared for 2021

Even as a separate bill to allow fixed-odds wagering on in-state horse races is making its way through the New Jersey Legislature, the state’s racing commission voted 4-0 Nov. 18 to give consent for licensees to try a fixed-odds pilot program during 2021 that would be limited to bets on out-of-state Grade I races.

The vote was unanimous but not without misgivings, as several commissioners voiced concerns prior to the vote that fixed-odds betting would cannibalize the existing pari-mutuel system and eventually erode New Jersey’s racing industry.

And one New Jersey Racing Commission (NJRC) member had to be corrected just prior to the vote because he thought the board had been discussing exchange wagering and not fixed-odds betting (It was unclear who, because commissioners often cross-talked and did not identify themselves when speaking during Wednesday’s teleconference meeting).

But the fact that the current bill, introduced Oct. 31, seems to have considerable political heft behind it appeared to be an overriding factor in the unanimous vote, as the presumed wishes of elected and appointed officials surfaced several times during the discussion.

“The pilot program would be regulated by the Division of Gaming Enforcement (DGE),” explained Judith Nason, the NJRC’s executive director. “DGE has the authority to regulate fixed-odds wagers, which [are] also known as sports wagers.

“So, the question before you today is whether the commission wants to grant its consent to fixed-odds wagers [on] Grade I stakes races of national interest that are being conducted in another state through Dec. 31, 2021, which would allow the pilot program to move forward,” Nason continued. “It would allow the attempt to gauge interest [in] fixed-odds wagers on horse racing. At the same time, there is proposed legislation that is moving forward that would broadly allow fixed-odds wagers on horse races.”

Asked by a commissioner what the benefit of the pilot program would be to New Jersey’s horse racing, Nason replied, “It would bring benefits to the sports wagering operators, and to a certain extent to, you know, that the revenue can be shared and some of it can be directed for purse money.”

Dennis Drazin, the chairman and chief executive of Darby Development LLC, which operates Monmouth Park and its sports book, weighed in with a different perspective.

“I think it’s commendable that we start with a pilot program until such time as the legislature has an opportunity [to vote on it] and the governor signs off, assuming we get to that point,” Drazin said.

“We’ve been hung up for six months on whether or not a wager on a horse race is s sports bet or a horse racing bet, because they’re handled differently. The proposed legislation says it’s a horse racing bet,” Drazin said.

“I gather that the attorney general, if I read Judy [Nason] correctly, has weighed in and feels that we should start with the pilot program for Grade I races only,” Drazin said.

Commissioner Michael Arnone expressed doubts about the long-term repercussions of fixed-odds betting prior to casting a “yes” vote in line with the other commissioners.

“I get the feeling like we’re the good monsignor getting called up to give last rites to the pari-mutuel system. I mean, I think the pari-mutuel system will lose out in the end if it has to compete,” Arnone said. “We’ll see what happens, but unfortunately, I’ve got a very negative view of it.”

Drazin said his support for trying the system is based partially on repeated complaints he hears from pari-mutuel customers about fluctuations in odds after a race goes off.

“The Australian [fixed odds] model has proven to grow their industry. And with a significantly less population in Australia than we have here, they out-handle us,” Drazin said. “I think it’s important that we look at this. Nobody knows what the future is going to be…In the early days, it will have a minimal impact [on pari-mutuels]. But five years down the road, a significant portion of the handle will be fixed odds.”

Prior to the unanimous vote, Drazin had asked the NJRC to widen to scope of the pilot program to include all graded North American stakes races, graded international races, and Monmouth’s two in-state Grade Is, the Haskell S. and United Nations S.

But Nason wouldn’t allow those modifications to the template for the pilot program, which had been handed down by the DGE. That leaves New Jersey’s bet-taking licensees with about 90 to 95 Thoroughbred races on which to offer fixed-odds wagering in 2021.

Based on Drazin’s comments, Monmouth appears set to embrace the pilot system. When asked by the commission, a Meadowlands official declined the opportunity to comment on the program.

“Lastly, I would ask you to just consider what you’re going to do if one track–and I’ll just give you an example, let’s say Churchill Downs–decides they’re going to authorize fixed odds on the [GI] Kentucky Derby, but they’re not going to give it to anybody else except to [the] Churchill [advance-deposit wagering system that] operates online in New Jersey. Do you think that that would have a negative impact on the rest of us?”

Thoroughbred Dates Approved for 2021

Also on Wednesday, the NJRC unanimously approved 2021 Thoroughbred dates at Monmouth (53 days, May 28-Sept. 26) and for a turf-only meet at the Meadowlands (nine days, Oct. 1-30).

John Heims, Monmouth’s racing secretary and director of racing, said that the track is going back to “more of a traditional” Memorial Day weekend opening like in past seasons. That calendar, he added, allows Monmouth to better dovetail with the closing meets at Oaklawn Park and Tampa Bay Downs, “so I think it actually bolsters out ability to offer a better racing product.”

In 2020, the New Jersey Thoroughbred Horsemen’s Association had approval to run 56 days at Monmouth and 19 at the Meadowlands. But the pandemic lopped off the start of the Monmouth meet and caused the cancellation of what was supposed to be the first dual-surface Thoroughbred meet at the Meadowlands since 2009. Those dates were transferred to Monmouth instead, where a total of 60 programs were run this year.

The topic of running both dirt and turf races at the Meadowlands in 2021 did not come up at Wednesday’s meeting.

 

Monmouth Reports $2.5 Million-plus Racing Loss

A separate section of the agenda dealt with the distribution of monies from the Casino Simulcasting Special Fund, which requires New Jersey racetracks to show evidence that their financial well-being has been negatively affected by casino simulcasting and/or that the racetrack is “financially distressed” in order to receive those funds.

During that agenda item, Nason said all three state tracks (Monmouth, Meadowlands, Freehold Raceway) met those requirements. Although a specific time frame for the financials was not mentioned, Nason read into the record that “Monmouth Park reported losses in excess of $2.5 million from racing operations while also citing the [NJTHA’s] debt obligations to the [New Jersey] Sports and Exposition Authority, which exceed $9 million through 2024.”

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