In both California and Arizona, stakeholders argue that this simulcasting blackout has hit both the bettors and the industry–by how much appears open to debate.

A recent analysis by the Arizona Horseman's Benevolent & Protective Association (AZHBPA) of the projected lost revenue to California purses between 2020 and 2021 pinned the number at more than $1,1 million, and another nearly $900,000 in lost track commissions.

The estimated loss to Turf Paradise alone between the years 2021 and 2022 amounts to more than $1 million, said Vince Francia, general manager of Turf Paradise. For Arizona Downs, however, the impact has been “negligible,” say track operators.

Scott Daruty, president of TSG's Monarch Content Management, also downplays the impact of the hamstrung signal to Monarch's bottom-line, saying that the resulting lost fees is only a fraction of Monarch's total business. He also disputes the AZHBPA's projected losses to the California purse account.

Monarch's umbrella extends over several California tracks–including Santa Anita Park, Del Mar, Golden Gate Fields and Sonoma County Fair–as well as Turf Paradise, Lone Star Park, Gulfstream Park, Laurel Park, Pimlico, Rosecroft Raceway, Monmouth Park, and Meadowlands.

Against the backdrop of this ongoing dispute, there are indications that 1/ST is eyeing potential inroads into the Arizona marketplace.

Within recent months, representatives of 1/ST have visited Turf Paradise with the intention of possibly purchasing the facility, said Francia. AZHBPA executive director, Leroy Gessman, said that 1/ST recently did the same at Arizona Downs.

According to two sources familiar with the situation, 1/ST has made a thus far unsuccessful bid to purchase Arizona Downs.

Daruty declined to comment whether 1/ST has indeed made any formal bid to purchase Arizona Downs but called the Arizona marketplace “one that appears to have potential.”

 “At that point, you're negotiating with a terrorist, right?”

The genesis of this rather convoluted simulcasting dispute goes back years.

In summary, when Arizona Downs reopened for live racing in 2019, Monarch sent its signal to the track itself but not to the track's network of Off-Track Betting parlors (OTB), and at a higher rate than its Arizonan neighbor, Turf Paradise.

In contrast, Monarch distributed its signal to Turf Paradise and its network of some 60 OTB's.

When asked about the contracting disparities between both Arizonan tracks, Daruty said at the time that Arizona Downs had been “consistently delinquent in its payments to our racetracks.”

In an effort to resolve industry stakeholder disgruntlement, the state passed in 2019 a law requiring all simulcast providers that send their races into Arizona to offer the products uniformly among all tracks and all their OTBs.

The following January, the Arizona Racing Commission passed a motion requiring the three racetracks in the state–Turf Paradise, Arizona Downs and Rillito Park–to comply with that law.

The commission also sent a letter to Monarch to “stop sending any simulcast signals to Arizona permittees racetracks and/or their additional wagering facilities.”

To all intents and purposes and despite various legal maneuverings in the interim, that state of affairs has remained, and Monarch has not beamed its signal into Arizona since.

At the start of Santa Anita's most recent winter meet, Monarch approached the operators of Arizona Downs with an offer of all Monarch content to the entire Arizona marketplace, including to Arizona Downs' network of OTBs, said Daruty.

According to Daruty, the operators of Arizona Downs made several unilateral modifications to the contract which were unacceptable. They included reducing the fees paid to Monarch tracks below the previously contracted rate between them, and a requirement for Monarch to “pre-approve” new simulcast locations without the ability to conduct legal and regulatory due diligence, said Daruty.

“At that point, you're negotiating with a terrorist, right?” said Daruty, once again raising Arizona Downs' reported history of delinquent payments.

“We can't abandon our principles and abandon our reasoned business approach to distributing our signals,” Daruty added.

Detailing a back-and-forth process of negotiations, Tom Auther, an Arizona Downs owner and partner, said that Monarch initially offered Arizona Downs a contract with non co-mingled pools–what he described as an immediate non-starter–and then an offer charging the track overall as much as twice what Turf Paradise was paying.

Monarch subsequently declined Arizona Downs' counter-offer, which was to pay Monarch 20% more in fees than Turf Paradise, said Auther.

“Twenty percent's still a lot of money,” Auther said. “If we paid what they want us to pay, the horsemen would not approve it because there'd be no money left–only three percent left in horse purses.”

When asked about Arizona Downs' reported history of defaults, Auther said that they had offered Monarch to escrow an adequate amount of money to offset the anticipated costs. “They refused it,” said Auther.

In an effort to understand the impact from the nixed signal into Arizona on California's horsemen, the Arizona HBPA contracted the firm Global Racing Solutions–founded and operated by Pat Cummings–to run the numbers.

According to GRS' calculations, California horsemen lost $1,115,000 in purse contributions between 2020 and 2021, and California track operators missed more than $877,000 in commissions during that same period.

To put that into perspective, California's purse total in 2021 was some $118 million.

TDN reached out to Thoroughbred Owners of California (TOC), who declined to comment.

As for Monarch, when they last ran the numbers, “the host fees that the Monarch tracks received out of the state of Arizona were less than one percent of the total host fees received by the Monarch tracks,” Daruty said. “It just doesn't move the needle for us.”

Daruty also said that the AZHBPA's projected California purse loss numbers were over-estimated, though added that Monarch hadn't run their own calculations.

And what of the potential impacts on the Arizona tracks? Again, there are mixed-signals.

Between 2021 and 2022, Turf Paradise lost an estimated $1,011,317 due to the missing Monarch signal, the estimated loss to the purse account was $944,915, and the estimated loss to the Regulatory Wagering Assessment (RWA)–a wagering tax used to fund the state racing department–was $61,139, according to Francia's calculations.

Auther, however, shared handle numbers with the TDN–taken, he said, from the state commission's website–comparing the year 2021 with 2018, when Turf Paradise received the Monarch signal.

According to Author's numbers, Turf Paradise lost in 2021 more than $8 million in overall handle compared to 2018. Turf Paradise operated in 2021 with 13 fewer OTBs than in 2018, however, and those OTBs were closed for 1038 days more than in 2018, according to Auther's calculations.

Auther also estimated that the annual hit to Arizona Downs' business without Monarch has been negligible. “It exists,” said Auther, about the loss. Horseplayers, however, have simply adjusted their betting patterns to other available options, he said, adding that the loss of the Monarch product to Arizona Downs was one of quality rather than numbers.

More broadly, Arizona HBPA president Bob Hutton broached what he sees as some of the more deeply felt impacts to the state's racing industry.

“With the state of racing the way it is, when we're trying to get fans to the sport, why is this good?” said Hutton, critical of Monarch's part in the negotiations. “This is costing horsemen all over the country money, and why? I don't get it.”

Turf Paradise, it should be noted, has been for sale since at least 2020.

According to Francia, 1/ST representatives recently toured the track with a potential eye to purchase the facility. “They have not made an offer but they have looked at the track,” he said.

According to Gessman, representatives from 1/ST have similarly toured Arizona Downs, adding that he was present at the visit.

According to two sources who wished to remain anonymous, 1/ST made the owners of Arizona Downs an offer for the facility which was subsequently declined.

Both Auther and Daruty refused to comment on any possible offer that 1/ST has made for Arizona Downs.

Though calling the Arizona marketplace one with potential, Daruty added that “I think all the infighting and frankly some of the regulatory dysfunction has just left it in a place that's not healthy.”

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“I am excited for the opportunity to contribute to efforts to save Arizona horse racing because I truly believe it is worth saving,” Weiss said. “I look forward to rebuilding the team at Arizona Downs and assembling a safe environment for horsemen and a memorable experience for fans.”

Over the years, Weiss has worked at a wide array of racing venues, including Beulah Park Racetrack, Birmingham Race Course, Thistledown Racetrack, Hialeah Park, Gulfstream Park, Monmouth Park and North Dakota Horse Park, where he re-instituted live racing after a long absence. He has held virtually every position at the racetrack, from starter to racing secretary and executive vice president in thoroughbred and quarter horse environments. Off the track, he pioneered, operated, and grew on-line wagering platforms, including AmericaTab and Darkhorsebet.com, both later acquired by TwinSpires and Xpressbet.

“Mike is the perfect fit to lead the revival of racing at Arizona Downs,” said Leroy Gessman, President of the National Horsemen's Benevolent and Protective Association. “He has a genuine passion for a successful future of all of Arizona Racing and we are very fortunate to have him.”

His hiring comes at a pivotal time for horse racing in the state, as the Arizona Senate is now considering a bill to modernize wagering at horse tracks and OTBs. Senate Bill 1794 would bring more than $300 million in capital investment to Arizona horse racing, including a new track at Arizona Downs, while generating more than $100 million in new state tax revenues.

Live racing returns to Arizona Downs on June 1, with a 1:30pm post time and racing will take place every Tuesday and Wednesday through September 15.

The post ‘I Truly Believe It Is Worth Saving’: Michael Weiss Named General Manager Of Arizona Downs appeared first on Horse Racing News | Paulick Report.

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Efforts to expand gaming in Nebraska saw legislators urge pro-gaming advocates to first talk to the state's horsemen about responsible ways to expand.

And then there's Arizona.

Arizona Gov. Doug Ducey not only isn't giving the time of day to our state's horsemen, he's rebuffing requests to just pull ourselves up by our own bootstraps. And he's doing it while pushing for a gaming expansion bill that would deliver just a fraction of what other states receive in gaming revenues – all while allowing the horse racing industry to remain dying on life support.

Gov. Ducey wants to allow sports teams to modernize their revenue stream by legalizing sports betting across the state and add sports books at taxpayer-funded sports stadiums.

And he wants Arizona tribes to be able to modernize the gaming options offered at their casinos – which they want more of, of course.

Meanwhile, Arizona is the only state in the country that still requires advance deposit wagering bets to be placed on a landline phone. But Gov. Ducey doesn't want us to be able to modernize.

The state's horsemen simply want to modernize wagering, adding historical horse racing machines at tracks and OTBs, to provide the revenue needed to survive. There are no requests for a government hand-out or to have facilities subsidized by taxpayers. We want to help ourselves with a sustainable business model at existing locations, under existing pari-mutuel laws – which have existed in Arizona for decades.

Those pari-mutuel laws just need modernizing.

Arizona state Sen. David Gowan has sponsored a bill to do just that and seems to have the support of his legislative colleagues.

But not Gov. Ducey.

We've seen what modernizing wagering and adding HHR can do for a state – Virginia is thriving, bringing that state more than $100 million in new revenues, while it has doubled the purses in Kentucky.

Meanwhile, in Arizona, legislators worry that Gov. Ducey is asking sports books for just a fraction of the $10 million a license costs in other states. They also worry that the 5% fees charged to tribal gaming aren't close to the 20% paid by tribes to other states.

Sen. Gowan's Senate Bill 1794 would bring the state more than $100 million in new tax revenues, lead to more than $300 million in capital investments, including a new track at Arizona Downs, and see daily purses increase from $80,000 to $300,000.

And it couldn't come at a more dire time. In Arizona, handle is down $55 million a year, purses are down $5 million a year, live race attendance is down 45%, Turf Paradise is for sale and Arizona Downs has struggled to keep the lights on.

And yet as Gov. Ducey takes steps to modernize gaming in Arizona, he won't even allow the state's horse racing industry to have a seat at the table, as he ushers in plans to allow the state's billionaire sports team owners to not just modernize their operations, but to thrive.

It all called to mind something DeSantis said last week.

“If it's something that benefits the state, we obviously have an obligation to work to do that,” he said when asked about tribal compact negotiations there and the importance of ensuring the state's horse racing industry is able to survive.

Why is that?

“Ultimately, I don't represent the Seminoles,” he said. “I represent Florida businesses and employees. We want to make sure those folks do well under whatever arrangement may be reached between the State of Florida and the Nation of the Seminole Indian Tribe.”

Arizona residents and small business owners should only be so lucky.

– Bob Hutton, President of the Arizona Horsemen's Benevolent & Protective Association, and Leroy Gessman, Executive Director of the AHBPA

If you would like to submit a letter to the editor, please write to info at paulickreport.com and include contact information where you may be reached if editorial staff have any questions.

The post Letter To The Editor: A Tale Of Two Governors, With DeSantis Prioritizing Florida Horse Racing And Arizona’s Ducey Thumbing His Nose At It appeared first on Horse Racing News | Paulick Report.

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Turf Paradise general manager Vincent Francia detailed the maintenance work and plans for the reopening of the seven-furlong infield course during the Jan. 14 Arizona Racing Commission meeting.

“What happened with the turf course was nobody’s fault,” Francia claimed. “When we closed on March 14 [in the midst of the COVID-19 outbreak], we suspended all activity. And that suspension included not taking care of the turf course during the summer…

“So when we started racing [on] it at the early part of the meet, the jockeys found it safe, but they were really just digging it up, and we could see that if we continued to run on it we were going to damage it and it’s not going to be able to continue,” Francia said.

“So we have been off of it. Last Saturday, the turf course was infused with liquid iron. And what that does, that’s like a human booster shot,” Francia explained. “That liquid goes right to the roots, and that was followed with a nitrate fertilizer. I was on the course Tuesday. I can already see the difference through Wednesday. We’re scheduled to go back on the turf Jan. 25, and hopefully this corrective action will take us through the rest of the meet,” which ends May 1.

Leroy Gessmann, who serves as both the Arizona Horsemen’s Benevolent and Protective Association (AZHBPA) executive director and the National HBPA president, told commissioners that “we’re all anxious to get back on it, but we all understand the importance of getting a good root system on the turf course in order to run on it.”

Turf Paradise is flush with about 1,400 horses on its backstretch, an uptick from previous meets largely because of the influx of outfits from northern California and New Mexico, where racing has been recently curtailed because of restrictions related to the pandemic.

“We’re in the ninth day of the 84-day session,” Francia said. “We’ve been up every day in our handle, which is very encouraging, and this is without the turf course being in operation, which is very popular with the horseplayers.

“Handle-wise, we’re doing really wonderful,” Francia continued. “The on-track attendance every day is where we want it. It’s about 60 people a day. We can manage that, make sure everybody’s safe. They’re all wearing masks [but we try to] keep them socially distant.”

Francia told commissioners that since the backstretch opened in late November, 22 coronavirus positives have been reported among licensees who have been tested. He added that most of those positives were reported among off-track betting (OTB) mutuel tellers, one of whom died from COVID-19 complications.

Francia said there have been three coronavirus positives among backstretch personnel, and that all three were quarantined, subsequently tested negative, and are now back at work.

Without naming the licensees, Francia added that, “We did have a rider test positive [Jan. 13] who never entered the [jockeys’] room. He is quarantined. His jockey agent is quarantined. And the two other riders [who employ that agent] have been contact-traced and alerted.”

Francia said that, “I think one of the obvious things we can conclude there is our horsemen are outside. And being outside in fresh air is an advantage, and that helps with the prevention of this virus spreading. When we look at our OTB teller situation, [they are] not outside. They are in confined quarters, a restaurant or a bar, and there’s people going in and out.”

Added Gessmann: “Having hardly any breakouts [on the backside] has been fabulous. I would have never thought we’d get [this far into the meet] and only have two or three positives of horsemen back there.”

Gessmann also lauded Turf Paradise for the Jan. 11 reopening of the four-furlong dirt training track in the southwest corner of the backside, which will help ease congestion during morning training.

“The reports I’m getting back from exercise riders is it’s in good shape,” Gessmann said. “After sitting for 10 months with no use, it is worked up and getting conditioned. It’s been a big help to get that open.”

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“The Jockey Club, and assorted business interests in technology and gaming, stand to make a lot of money if the industry is realigned (via HISA),” Gessman wrote. “That is one reason the bill creates a 'private-sector' governing body to be the Authority that will oversee the industry. What a deal. The foxes get to guard the henhouse. All the 'lesser players' in the industry have to do is accept what is mandated in this legislation.”

Read more at the Northern Kentucky Tribune.

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Leroy Gessmann, who serves as both the NHBPA president and as Arizona HBPA’s executive director, told commissioners at the Oct. 8 Arizona Racing Commission (AZRC) meeting that “this thing is being ramrodded right now by [U.S. Senate Majority Leader Mitch] McConnell…. We feel this thing is unconstitutional, just as the ban on sports betting was unconstitutional. We have the same attorneys looking into it.”

Gessmann did not speak in specifics about which aspects of the bill the NHBPA considered unconstitutional. Nor did he outline what the purported similarities were to the federal ban on sports betting that got overturned by a 2018 U.S. Supreme Court ruling.

Although previous versions of the Integrity Act have existed in the House of Representatives since 2015, the Senate version of the HISA (SB 4547) that was introduced by McConnell Sept. 9 has language that now matches the amended House version that passed with bipartisan support Sept. 29. As the majority leader, McConnell determines which bills come up for action in the Senate, and the longtime Kentucky legislator has consistently indicated he’s strongly in favor of a vote on HISA happening prior to the end of the current legislative session.

Gessmann’s comments came 22 minutes into an AZRC presentation last Thursday that detailed possible implications of the HISA on the sport’s regulation in Arizona. He was asked by the commission if he’d like to speak on the issue, and to clarify if he’d be commenting personally or as an HBPA representative.

“I’m going to speak on this topic as the National HBPA president,” Gessmann said. “Although there are a few good things in this bill, there’s a lot of concerns…. There’s been a version of this bill for six years in the House, and it’s never gone anywhere. And then when McConnell teamed up with Keeneland, Churchill, The Jockey Club, this thing all of a sudden took off.

“National HBPA is against this bill because of the Lasix issue [and] because of the formation of the Authority,” Gessmann said. “The Authority is made up of nine members, and they are appointed, they’re not elected [and] they can have nothing to do with the horse industry. They can have no experience or be involved in any way in the horse industry. [So] how [you] take people that don’t know anything about a horse and put them in charge of such an operation is beyond me.

“The other key issue [is] the expense of this is going to be a burden on the horsemen,” Gessmann continued. “Every start, you’re going to be assessed. The tracks are going to be assessed, and the state is going to be assessed to pay for this Authority and to oversee this thing on a national basis. Although we feel as horsemen the safety of the tracks are important, [there] is going to be major concerns with the safety of the racetracks, especially in Arizona.”

Gessmann did not elaborate on why Arizona, in particular, would face outsized concerns about racetrack safety.

At a later point in the discussion, Gessmann was asked how McConnell’s re-election bid factored into the outcome of the HISA bill.

“McConnell is trying to get it passed through in the ‘lame duck’ session before it ends, before his term ends,” Gessmann said. “If they don’t get it done in the lame duck session, then the bill dies, and they have to start all over.”

GovTrack, a legislative transparency organization that uses logistic regression analysis to rank the likelihood of passage of the 10,000 bills that come up annually in Congress, currently gives HR 1754 a 63% chance of being enacted.

SB 4547 is ranked at 21% chance to be enacted. The discrepancy between the two numbers no doubt reflects that the House version has already been passed by that chamber; McConnell’s considerable political clout is apparently not factored into the algorithm.

Either way, both prediction rates are astounding considering that GovTrack gave the Integrity Act only a 2% chance of being enacted when the first version of the bill debuted back in 2015.

An Unlikely 0-Fer

Considering his dauntingly long list of graded-stakes-winning achievements, it was a bit of  surprise to learn that trainer Todd Pletcher had been shut out of the GI Jockey Club Gold Cup until Saturday, when ‘TDN Rising Star’ Happy Saver (Super Saver) shot through at the rail to claw out a three-quarter-length victory in the traditional season-capping highlight of the Belmont Park autumn meet.

According to the count by the New York Racing Association press department, Pletcher had been 0-for-23 in the Jockey Club Gold Cup, with seven second-place finishes.

That included last year’s version of the Gold Cup, in which Vino Rosso crossed the wire first but was disqualified and placed second for causing interference in the stretch. (Vino Rosso avenged that DQ by winning the GI Breeders’ Cup Classic in his next start).

“Not only had we not won it, we’d suffered some really close defeats. And then throw in a disqualification on top of that, and it’s been a frustrating one over the years,” Pletcher said. “This one was fun. It’s one of the races that has been hard on us. We’ve had some tough losses and it was very fulfilling to win it today.”

Five of those runner-up efforts were by margins of a length or less, including near-misses by Lawyer Ron to Curlin (a neck in 2007) and by Newfoundland to Funny Cide (three-quarters of a length in 2004).

BC Juvenile Getting Interesting

With a pair of undefeated colts now on a collision course for the GI Breeders’ Cup Juvenile, the premier campaign-capping race for 2-year-old males is shaping up to be one of the more anticipated showdowns on the docket for the Nov. 6-7 championships at Keeneland.

Jackie’s Warrior (Maclean’s Music) commandeered the early pace in confident fashion, then was hand-ridden home after edging away under pressure in the stretch to romp home by 5 1/2 lengths in Saturday’s GI Champagne S. at Belmont. He’s now a perfect four-for-four and looms as the top East Coast-based juvenile heading to Lexington.

It’s presumed he’ll vie for favoritism in the Juvenile with home-court hopeful Essential Quality (Tapit), a ‘TDN Rising Star’ who broke his maiden by four lengths when favored on the GI Kentucky Derby undercard, then pasted the GI Breeders’ Futurity field at Keeneland Oct. 3 by employing assertive, pace-pressing tactics to engineer an at-will 3 1/2-length score.

The Juvenile itself is very much in need of a reboot after last year’s edition proved to be one of the weakest in the race’s history. Storm the Court (Court Vision) was the $93.80 winner. But he, and the race’s other top four finishers, have yet to win another race.

In fact, the field of eight that contested last year’s Juvenile now stands as a collective 2-for-33. The only horses to subsequently visit the winner’s circle have been the Japan-based Full Flat (Speightstown), who won the Saudi Derby Cup in Saudi Arabia back on Feb. 29, and Shoplifted (Into Mischief), who won the Springboard Mile at Remington Park last Dec. 15.

The post The Week in Review: HBPA Says ‘Ramrodded’ Integrity Act Could Get Challenged As ‘Unconstitutional’ appeared first on TDN | Thoroughbred Daily News | Horse Racing News, Results and Video | Thoroughbred Breeding and Auctions.

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