Former HBPA Prez On 5th Circuit Appeal: ‘No Matter The Result’ Both Sides Expect Supreme Court To Decide HISA’S Fate

Leroy Gessmann, who served as president of the National Horsemen's Benevolent and Protective Association (HBPA) from 2015 to 2021 and currently works as the Arizona HBPA's executive director, told commissioners at the Arizona Racing Commission (AZRC) meeting Thursday that regardless of the decision gets handed down by the United States Court of Appeals for the Fifth Circuit, both the HBPA and its opponents in a 2 1/2-year-old lawsuit to nullify the Horseracing and Safety Integrity Act (HISA) agree that the nation's highest court will eventually have to be called upon to settle the matter.

Gessmann spoke in the wake of Oct. 4 oral arguments in the Fifth Circuit case that pits the HBPA and 12 of its affiliates against the HISA Authority and the Federal Trade Commission. On May 4, a lower court deemed that the now-in-effect version of HISA is indeed constitutional because a 2022 rewrite of the law fixed constitutionality problems the Fifth Circuit had identified. Shortly after that lower court's ruling came out in the spring, the HBPA plaintiffs then swiftly filed for another appeal back to the Fifth Circuit, which agreed to hear the case on an “expedited” basis.

“Both sides left the [Fifth Circuit] hearing feeling positive that they made good arguments and that they would win,” Gessmann said. “So it's also been stated by both parties, no matter what the result is, the next step is the U.S. Supreme Court. We'll see when we get a ruling. Usually it takes about 30 to 60 days to get a ruling.”

Gessmann then segued into updating the AZRC on a related project spearheaded by the HBPA, which is federal legislation filed Sept. 26 to repeal HISA and replace it with a voluntary interstate compact to govern the nation's Thoroughbred, Standardbred, and Quarter Horse racing.

That bill, named the Racehorse Health and Safety Act (RHSA), would establish a governing body known as the Racehorse Health and Safety Organization (RHSO), which would oversee breed-specific Scientific Medication Control Committees tasked with drafting and recommending drug rules for each breed.

There would also be racetrack safety oversight based on existing standards as set forth by both the National Thoroughbred Racing Association and the model rules of the Association of Racing Commissioners International.

Individual states would decide whether their own racing commission or the RHSO got to enforce the new federal rules, which would supersede existing state statutes. States wouldn't have to opt into the RHSO, but the cost of not doing so would jeopardize their racetracks' ability to simulcast out of state.

“So far, we've got a lot a lot of reviews on it, and it seems to have gained some traction, so hopefully something can be done there,” Gessmann said, adding that the bill has been “well-received and is moving through the process in the legislature in Congress.”

Asked by commissioner Linda York if he had any sense of a timetable for when the bill might make it to the Congressional floor, Gessmann said, “We have not been advised of anything, how quickly it could get there. Unfortunately, the National HBPA doesn't have a very large pack [of lobbyists] to help move things through.”

The RHSA's sponsor is Rep. Clay Higgins, a Louisiana Republican. More than two weeks after its introduction, the bill has not yet been assigned to a committee. It has thus far gained one co-sponsor, Rep. Doug Lamborn, a Colorado Republican.

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Turf Paradise Won’t Open in November as Sale of Property Nears Closing

The current ownership that is selling at Turf Paradise in Phoenix won't be opening the track in November as planned for its 2023-24 race meet. But horsemen are holding out hope that the incoming ownership will be able and willing to operate the remainder of the scheduled season from January through May 4 if the real estate deal closes as expected by mid-December.

Turf Paradise management issued a statement via Facebook Tuesday afternoon confirming the decision.

Also on Tuesday, an email message reportedly sent to Arizona Horsemen's Benevolent and Protective Association (AZHBPA) members by that group's executive director, Leroy Gessmann, detailed potential next steps as the 67-year-old venue transitions to its new buyer, CT Realty of Dallas and Newport Beach, California.

“After several months of speculation and rumors, I finally have some definite updates that I can report to the membership,” Gessmann wrote. “Yesterday July 31, 2023, [AZHBPA] President Lloyd J. Yother received a call from [Turf Paradise owner] Mr. Jerry Simms, telling us that his final decision was to not run a race meet in November and December of 2023. After 23 years of running race meets, he felt it was time that he stepped aside and turn things over to the possible potential buyer, Mr. James Watson,” who is the managing partner of CT Realty.

“He wanted to announce this now, so horsemen had time to find alternative plans,” Gessmann wrote. “Mr. Simms has started laying off key employees, is issuing a national press release this week and stopped watering the turf track. So, I do not see things changing.”

Gessmann continued: “What is next for Arizona racing? After conversations with Mr. Watson, his status is that his final financial approval will be issued on Sept. 15. If this is approved and all the zoning goes through, then they plan to close the sale on Dec. 17. If all that falls into place, Mr. Watson is considering running a race meet starting in January through May 4. A lot of ifs in that last statement, but there is a chance for a race meet in January 2024.

“There also appears to be a lot of interest in Arizona Downs currently,” Gessmann wrote, referring to the track 82 miles north in Prescott Valley.

Arizona Downs didn't apply for a June-through-September race meet this year because of financial difficulties. That facility formerly ran as Yavapai Downs between 2000 and 2010. The ownership at that time then filed for bankruptcy.

Arizona Downs co-owner Tom Auther “is telling me he has had some racing companies contact him on the possibility of investing in Arizona Downs to allow the running of some type of race meet. This would require a lot of things to come together quickly and cooperation from the Department of Racing. But there are ongoing discussions,” Gessmann wrote.

“There have been some major racetrack operators expressing interest in building a new track in Maricopa County,” Gessmann wrote. “These alternatives may be longshots, but there is interest in rebuilding Arizona racing. I know Mr. Simms's decision to close the track is very disappointing and scary news to all of us. However, I want you to know that I, President Yother and the HBPA Board will continue to work on restoring racing in Arizona!”

The sale of Turf Paradise was first made public Apr. 12. At that time, TDN reported that racing was expected to continue there only as a placeholder for several more seasons while new uses for the venue went through the planning, approval, and construction stages.

About a month later, other news outlets in Arizona subsequently reported that CT Realty would consider keeping racing going on a longer-term basis if it could successfully lobby the state legislature to approve historical horse racing machines or some other form of gaming at the track.

The relationship between the Arizona racing community and Simms has been acrimonious. An extraordinarily long pandemic closure, multiple racetrack safety issues, and prolonged fights over off-track betting privileges, simulcast signals, and how the horsemen's purse money can be used have roiled in the courts and at racing commission meetings.

Simms has been quoted in the press since 2020 as saying that he operates Turf Paradise at a “huge negative” financially.

Gessmann told TDN back in April that, “Our understanding is it's going to be developed in stages, and they're going to race for one to two, [maybe] three more years depending on the development process.”

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Turf Paradise Nears Sale for Development; Horsemen Eye Arizona Downs Revival

Turf Paradise in Phoenix is reportedly in the due-diligence phase of negotiations to be sold for development.

Racing is expected to continue only as a placeholder for several more seasons while new uses for the 67-year-old venue go through the planning, approval and construction stages.

The incoming owner of Arizona's primary commercial Thoroughbred track is expected to transition the property in pieces to “industrial and multi-family uses,” according to the online media outlet Axios Phoenix, which first broke the story Apr. 12.

Leroy Gessmann, the executive director of the Arizona Horsemen's Benevolent and Protective Association (AZHBPA), told TDN in a Wednesday phone interview that a longer-term hope involves Arizona Downs, 82 miles north in Prescott Valley, being potentially sold to 1/ST Racing & Gaming, which might then pick up enough dates to sustain a circuit.

The possible sale of Arizona Downs to 1/ST Racing has been percolating since last year. 1/ST Racing owns Gulfstream Park, Santa Anita Park, Golden Gate Fields, Pimlico Race Course and Laurel Park. The firm's chief executive officer, Aidan Butler, did not return a voicemail message seeking confirmation of 1/ST Racing's involvement prior to deadline for this story.

Arizona Downs didn't apply for a June-through-September race meet this year because of financial difficulties. That facility formerly ran as Yavapai Downs between 2000 and 2010. The ownership at that time then filed for bankruptcy.

“I understand that [1/ST Racing] has a contract with Arizona Downs, and they're kind of in the same stages,” Gessmann said. “They're going through their due diligence right now. I know [1/ST Racing] wants to continue racing at Arizona Downs. How it all ends up, we're all in kind of a holding pattern here to see how things develop.”

The relationship between the Arizona racing community and Jerry Simms, Turf Paradise's owner for 23 years, has been acrimonious. An extraordinarily long pandemic closure, multiple racetrack safety issues, and prolonged fights over off-track betting privileges, simulcast signals, and how the horsemen's purse money can be used have roiled in the courts and at racing commission meetings.

Simms has been quoted in the press since 2020 as saying that he operates Turf Paradise at a “huge negative” financially. He quipped to Axios Phoenix this week that “I'd rather spend time with my grandkids” than continue running the track.

Axios Phoenix reported that James Watson, the managing partner of CT Realty out of Dallas and Newport Beach, California, said he's “under contract” with Simms to purchase the property. Neither Simms nor Watson would provide Axios Phoenix with details of their negotiations, citing a confidentiality agreement.

Gessmann told TDN it's evident by what's happening around the track that the deal is getting nearer to closing.

“Mr. Watson is going through his due diligence,” Gessmann said. “The last couple weeks there have been companies here inspecting things, doing ground tests, and I know they're also working on rezoning possibilities.

“Our understanding is it's going to be developed in stages, and they're going to race for one to two, [maybe] three more years depending on the development process,” Gessmann continued. “With both parcels of land, I think they're right at 200 acres. There's a lot of empty ground here. They're going to start with the empty ground and then work towards the racing operation, I guess.

“We hope Mr. Watson will continue racing for a couple of years until we can make other arrangements,” Gessmann said.

“The horsemen are somewhat excited, yet also disappointed,” Gessmann said. “We're excited that Mr. Simms is moving on and relinquishing his hold in Turf Paradise. However, Mr. Watson is unsure on the future of racing, which is a possibility we all knew when it went up for sale, that it could get sold to a land developer.”

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Equine Veterinarian, Owner Dr. Doug Daniels Elected National HBPA President

Horse owner and equine veterinarian Dr. Doug Daniels has been elected president of the National Horsemen's Benevolent & Protective Association, which represents thoroughbred racing owners and trainers through affiliates in a number of states.

Daniels, who was unopposed for the National HBPA presidency, has been vice president of the Virginia HBPA and a member of the National HBPA's executive committee since 2019. He succeeds Leroy Gessmann, who had been president since 2015. In addition to his own Virginia Equine PLLC veterinary practice, Daniels has and continues to work for the Virginia Racing Commission when needed as a regulatory veterinarian at the commonwealth's thoroughbred, standardbred and steeplechase race meets.

Jami Poole, president of the Mountaineer HBPA who chaired the nominating committee, said of Daniels: “Having someone with the credentials of Dr. Daniels lead the National HBPA speaks to the commitment of our organization, and should be a message to all that we are leading into the future and we are 'horsemen helping horsemen.'”

“It's a pivotal time for the industry in general,” Daniels said. “I feel very fortunate to be involved and to have the opportunity to give back to an industry that's been good to me personally and professionally. My hope and my goal would be to use my education and my work experience and knowledge of equine medicine to the betterment of the membership.”

He takes over the helm at a time when the National HBPA is challenging in federal court in Texas the legality of the Horseracing Integrity and Safety Act (HISA). The National HBPA long has advocated for enhanced safety regulations, security and tougher sanctions for cheaters but believes policies must be implemented with transparency and input from horsemen's and veterinary representative groups.

“Because of the pending federal legislation, I feel like this is a good time for the membership to have a veterinarian with a voice to look out for their interests,” Daniels said.

As a horse owner who keeps a couple of racehorses in training as well as a broodmare or two at any time, Daniels said he “all too painfully” knows the concerns facing owners.

“If there is some noise to be made, some massaging or finessing to be done, I plan to be all up in it,” he said of the challenges facing owners and trainers. “Medication policy, worker's compensation and immigration issues are going to require a lot of continued attention.

“I definitely enjoy what I do for a living, and I couldn't imagine doing anything else. But I'm looking forward to branching out into this next aspect of my professional career. It's one I've not taken lightly and it's one I discussed with my family at length before taking this step. I'm excited about it. I'm excited about the people I'll be working with at the HBPA, in particular with (CEO) Eric Hamelback. We're so lucky to have him. He makes my position so much easier.”

Daniels grew up in Kansas, his parents raising and racing horses in Nebraska, Oklahoma, Colorado and Kansas. He attended undergraduate and received his Doctor of Veterinary Medicine degree from Auburn University, graduating cum laude. Daniels ventured into horse ownership once his vet practice became established. He has raced in Virginia, Maryland, New Jersey, Florida, Texas, West Virginia and Pennsylvania.

Daniels was elected at the National HBPA's full board meeting late last week at Prairie Meadows racetrack in Altoona, Iowa, which included the election of all National HBPA Officers. The only change other than the election of president Daniels was that of the National HBPA's East Region vice president. The East Region affiliates elected Sandee Martin, president of the Pennsylvania HBPA. Re-elected as vice presidents were: Kentucky HBPA president Rick Hiles (Southern Region), Arizona HBPA vice president Lloyd Yother (West Region) and Indiana HBPA president Joe Davis (Central Region). Hiles also remains in the position of first National HBPA vice president. The secretary-treasurer, an appointed position, remains Lynne McNally, executive vice president of the Nebraska HBPA.

Hamelback concluded with saying the overall meeting was positive and productive. He said among the topics discussed at the meeting were fixed-odds wagering on horse racing and the importance of revenue sharing for horse owners, legislative efforts revolving around H2B and H2A visa programs, continued discussions of HISA implementation, and the signature Claiming Crown. Additionally, the NHBPA Full Board recognized and approved an affiliate, the New Mexico Horsemen's Association. That organization will be returning with its members as an affiliate under the National HBPA.

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