Since 2009, more than $9 million has been taken from purse accounts at New Mexico's five racetracks to use for the insurance premiums. In late 2020, the NMHA went to court to end the practice and to get all or a portion of the purse money returned.

“[The] reality is that the practice is being questioned now; the parties presented no authority supporting the proposition that a party somehow waives a rule-making overreach by the mere passage of time,” Judge Lopez wrote. “It is neither the Commission's nor this Court's role to decide and implement policy which would essentially allow the skimming of racing revenue for the admittedly favorable purpose of protecting jockeys and exercise riders who may sustain injuries in the course of engaging in the inherently dangerous profession of horse racing.”

Judge Lopez stayed his order until at least Mar. 18, the last day of the 2023 legislative session, “to allow the parties to consider legislative intervention, if appropriate.”

Gary C. Mitchell, general counsel for the New Mexico Horsemen's Association (NMHA), added, “The battle is over the political power of the racetracks that wish to cut down on the expenses of running a racetrack and a race meet and enjoy greater income from their casinos. The great advocate standing in their way is, and has always been, the Horsemen's Association and, hopefully, the New Mexico Legislature.”

To read the complete ruling, click here.

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The complaint was filed with the New Mexico State Ethics Commission last Thursday.

The dispute goes back to at least December 2020, when the NMHA filed suit in the Second Judicial District Court in Bernalillo County to stop what it alleges was a longstanding practice by the commission of taking money that should have gone to purses and, instead, allowing tracks to use the money to pay for liability insurance for jockeys and exercise riders. The horsemen say that the transfer of purse money to racetrack expenses has cost the purse fund $8 million to date.

The NMHA also charges that the racing commission has retaliated by finding a way to cut off the revenue stream for the horsemen's group.

The NMHA says that it has been funded by voluntary contributions from member horse owners when they earn purse money. The horsemen charge that the commission voted to cut off the revenue stream, alleging that the commission decided that it was a matter of purse money being improperly funneled to the horsemen's group.

Gary Mitchell, the general counsel for the NMHA, called that “an effort to silence the state's traditional, and largest, advocate for horsemen, representing more than 4,000 Thoroughbred owners and trainers.”

“If you start doing away with the advocates that appear before the various state agencies and you exact this kind of retribution, it sets a dangerous precedent,” Mitchell said.

The ethics complaint accuses the New Mexico Racing Commission and the New Mexico Gaming Control Board of conspiring for the express purpose of undermining the horsemen's representative.

According to the NMHA, the New Mexico Gaming Control Board backed the commission, even though its own hearing officer ruled in favor of the horsemen on this matter.

According to the NMHA, in Aug. 2021, a District Court Judge ruled in favor of the horsemen and stayed the commission's action, meaning the contributions from purses to the horsemen's group should have resumed. Claiming that the commission has ignored the court order that would have allowed owners to resume making contributions, the horsemen's group is asking the courts to hold the racing commission and the gaming board in contempt of court.

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NMHA President Roy Manfredi told the Paulick Report that the horsemen's attorney contacted Zia Park's attorney, who relayed that the county's only EMT had been pulled away by a family emergency, thus the track was unable to provide an EMT for morning training.

Racing at Zia Park is scheduled to begin on Sept. 26, but video posted on social media showing the track's backstretch appears to demonstrate a lack of preparedness for the meet. Manure is still piled up, and large weeds have taken over much of the backstretch area.

“When you see the condition of the backside, it doesn't appear they planned on running,” Manfredi said.

The contract between Zia and the NMHA dictates that trainers be allowed onto the backstretch on Sept. 9 to begin preparing their stalls, and that horses be allowed to ship in on Sept. 12 while training was to begin on Sept. 15. Now, the latest information indicates that it may not be until Saturday that the track is open for training.

In addition to the lack of an EMT, no outriders have arrived at the track to oversee safety during training hours. Both deficits are in direct violation of New Mexico Racing Commission rules.

However, the racing commission and the horsemen's association are engaged in an ongoing legal battle, with the horsemen charging the regulatory body with depriving racehorse owners and trainers of their civil rights and other violations, and thus no direct contact between the parties is allowed.

“It's my contention that this is a racing commission problem, because they're in violation of racing commission rules,” said Manfredi. “We have had our attorney send a letter to the racing commission's attorney, asking them to step in, and we're waiting to hear back.”

Another issue brought forward by Zia Park, according to Manfredi, is the rise of COVID-19 cases in New Mexico. Governor Michelle Grisham is expected to announce new mandates on Thursday, Sept. 16, and Manfredi said the NMHA will issue directives to its members to follow those mandates.

If Zia Park continues to fail to meet the directives stipulated in its contract with the horsemen, the NMHA has the option to pull the simulcast signal from the track.

“We're not there yet,” Manfredi said.

Images showing the backstretch of Zia Park on Wednesday, Sept. 15

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A variety of speakers have been scheduled, including opening remarks on “The Importance of Horseracing to the New Mexico Economy” from state Rep. Candy Spence Ezzell. Gary C. Mitchell, P.C., attorney for the horsemen's association, will give a legal update, and a history of the NMHA will be reviewed by NMHA president Roy Manfredi and NMHA board member Larry Strain (both horse owners).

Benevolent functions of the NMHA will be outlined by Terri Montoya, NMHA administrative assistant. Montoya will also discuss “purse funds vs. owner funds” with trainer Lynette Baldwin, a horse trainer and NMHA member.

For any question, contact NMHA executive director Richard Erhard at nmhastate1@aol.com.

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The New Mexico Horsemen's Association filed suit against the New Mexico Racing Commission in federal court late Monday, charging the regulatory body with depriving racehorse owners and trainers of their civil rights and other violations. The horsemen seek compensatory damages, legal fees and other relief the court deems appropriate.

“The horsemen finally said, 'Hold it. How many constitutional laws can you continue to violate? How many statutes can you continue to ignore?'” said Gary Mitchell, attorney for the New Mexico Horsemen's Association (NMHA). “The horsemen said, 'Enough. We don't have any other place to go but federal court. We need this to stop.'”

The NMHA, which represents about 4,000 Thoroughbred and Quarter Horse horsemen in New Mexico, already has two lawsuits pending in state court against the New Mexico Racing Commission (NMRC).

Previously precluded from communicating with the commission, contacting any commissioners or attending the regulatory agency's public meetings on, the NMHA turned to the federal court–filing against the NMRC, as well as the individual commissioners–under Section 1983 of the Civil Rights Act and the New Mexico Tort Claims Act. The action creates the potential for individual members of the commission to be held personally liable.

“The commissioners are deliberately attempting to do away with the horsemen's association,” Mitchell said. “We're prepared to prove, in court, that this is being done intentionally. They haven't hesitated to do everything in their power to shut out New Mexico's horsemen, and ultimately shut down the NMHA.”

The NMHA filed suit in the Second Judicial District Court in Bernalillo County in December to stop the commission's years-long practice of taking horsemen's purse money to pay the racetracks' liability insurance on jockeys and exercise riders, in clear violation of state law. The NMHA stated the funds amount to over $8 million. The horsemen returned to court in May after the commissioners ordered tracks to shut off the NMHA's revenue stream, derived from access to funds horsemen have earned from purses.

According to the NMHA, the funds in question are used to pay medical fees for its members, the NMHA's Political Action Committee and administrative costs, including the oversight of the purse account for the horsemen and the state's five racetracks.

“We have never taken money from the purse funds to benefit our organization,” Mitchell said. “In fact, we took our own money to pay for the accounting, collection, management, dispersal and annual audits of how this money is handled. The taxpayer was not paying for us to do all of this. We were doing it for free, paying for it through contributions from our members, and the commissioners now say 'stop.'”

He continued, “They wish to get their hands on this money and use it how they see fit–which is basically to pay the costs of running the racetrack, thereby allowing more money to go into the casinos' pockets. Sadly, the commission, which is supposed to be fair and equal to everybody, sees no obligation to be fair to the horsemen.

“Allowing gaming at racetracks in New Mexico was done to save racing,” Mitchell said. “The racetracks cannot have gaming unless they have racing. The law is very clear about it. The gaming compact is clear about it. The Gaming Control Act is clear about it. The Horse Racing Act is clear about it.”

Additionally, the NMHA states that funds have been directed into owners' earnings based on race results.

“When the race is run, the purse is paid and that now becomes the winning horseman's money,” said long-time racehorse owner and NMHA President Roy Manfredi. “By their actions, the racing commission has taken away the NMHA's ability to provide financial assistance to horsemen in need. That's the same as saying you cannot donate to the March of Dimes, the NRA or any other organization, simply because your employer doesn't like the March of Dimes or the other organization. Once the money is paid to an individual who owns a horse, that money is theirs and they can do whatever they want with it. During the pandemic, the NMHA provided $100,000 in alfalfa and grain to the horsemen when we weren't able to run.”

“All we've ever asked them to do is just follow New Mexico state statute, which are laws. This commission considers them suggestions.”

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“The horsemen finally said, 'Hold it. How many constitutional laws can you continue to violate? How many statutes can you continue to ignore?'” said Gary Mitchell, attorney for the New Mexico Horsemen's Association (NMHA). “The horsemen said, 'Enough. We don't have any other place to go but federal court. We need this to stop.'”

The NMHA, which represents about 4,000 Thoroughbred and Quarter Horse horsemen in New Mexico, already has two lawsuits pending in state court against the New Mexico Racing Commission (NMRC).

Instead of working with horsemen to settle the dispute, the NMRC subsequently barred the NMHA from communicating with the commission, contacting any commissioners or attending the regulatory agency's public meetings. With no alternative after being deprived of any forum before the commission, the NMHA sought relief in federal court against the NMRC, as well as the individual commissioners, under Section 1983 of the Civil Rights Act and the New Mexico Tort Claims Act. A highly unusual step for a state horsemen's association, the action creates the potential for individual members of the commission to be held personally liable.

Mitchell said the commission is trying to silence the largest advocacy group under its jurisdiction.

“The commissioners are deliberately attempting to do away with the horsemen's association,” Mitchell said. “We're prepared to prove, in court, that this is being done intentionally. They haven't hesitated to do everything in their power to shut out New Mexico's horsemen, and ultimately shut down the NMHA.”

The NMHA filed suit in the Second Judicial District Court in Bernalillo County in December to stop the commission's years-long practice of taking horsemen's purse money to pay the racetracks' liability insurance on jockeys and exercise riders, in clear violation of state law. The transfer of purse money to pay track operating expenses has cost horsemen to date more than $8 million.

The horsemen were back in court in May after the commissioners ordered tracks to immediately shut off the NMHA's revenue stream, derived from access to funds horsemen have earned from purses.

The funds in question are used by the NMHA to pay medical fees for its members, the NMHA's Political Action Committee and administrative costs associated with a proper accounting for all expenditures. That includes the critical role of overseeing the purse account for the horsemen and the state's five racetracks.

“We have never taken money from the purse funds to benefit our organization,” Mitchell said. “In fact, we took our own money to pay for the accounting, collection, management, dispersal and annual audits of how this money is handled. The taxpayer was not paying for us to do all of this. We were doing it for free, paying for it through contributions from our members, and the commissioners now say 'stop.'”

Mitchell also questioned the commission's motivation.

“They wish to get their hands on this money and use it how they see fit – which is basically to pay the costs of running the racetrack, thereby allowing more money to go into the casinos' pockets,” he said. “Sadly, the commission, which is supposed to be fair and equal to everybody, sees no obligation to be fair to the horsemen.

“Allowing gaming at racetracks in New Mexico was done to save racing,” Mitchell said. “The racetracks cannot have gaming unless they have racing. The law is very clear about it. The gaming compact is clear about it. The Gaming Control Act is clear about it. The Horse Racing Act is clear about it.”

The NMHA challenges the commission's contention that the horsemen's organization is taking money designated for purses, pointing out that the money in question has transitioned into owners' earnings based on race results.

“When the race is run, the purse is paid and that now becomes the winning horseman's money,” said long-time racehorse owner and NMHA President Roy Manfredi. “By their actions, the racing commission has taken away the NMHA's ability to provide financial assistance to horsemen in need. That's the same as saying you cannot donate to the March of Dimes, the NRA or any other organization, simply because your employer doesn't like the March of Dimes or the other organization. Once the money is paid to an individual who owns a horse, that money is theirs and they can do whatever they want with it. During the pandemic, the NMHA provided $100,000 in alfalfa and grain to the horsemen when we weren't able to run.”

“All we've ever asked them to do is just follow New Mexico state statute, which are laws. This commission considers them suggestions.”

The horsemen seek compensatory damages, legal fees and other relief the Court may deem appropriate.

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The New Mexico Horsemen's Association has taken additional legal action against the New Mexico Racing Commission after the regulatory body ordered the defunding of the organization that represents about 4,000 Thoroughbred and Quarter Horse owners and trainers in the state.

On May 20, the racing commission ordered tracks to withhold the 1% of purse money that goes to the horsemen's association for administrative costs, about $400,000 a year. Additionally, the commission ordered a halt to the $5 per-starter fee NMHA member owners pay toward medical expenses for horsemen and their employees, as well as a $2 per-starter fee utilized for legislative advocacy.

The horsemen's association responded three days later with its second suit in less than six months filed against the commission in the Second Judicial District Court in Bernalillo County. On Dec. 2, the NMHA went to court to ensure that the state's laws governing the distribution of purse monies are followed.

Horse owners have been charged a $100-$150 starter fee to cover certain track operation costs, including staffing the starting gate. The amount of money siphoned from purses to the racetracks dating to 2004 totals more than $8.4 million, which the horsemen's association is asking to be refunded to the purse account.

“I think we've been very reasonable in trying to negotiate settlements of litigation, and the commission has refused to negotiate in good faith” said Gary Mitchell, the attorney representing the horsemen's association. “It's a matter of people communicating, getting together, but the arrogance of the commissioners stands in the way.”

“This is a small state where we all know one another, as lawyers, as horsemen and as track owners,” Mitchell said. “There's no reason why somebody leading this couldn't get everybody together and say, 'We can iron out these problems.' We do need to figure out some way to insure jockey and exercise riders, outriders and people who work on the tracks, including grooms and such so these people will be safe and have insurance to cover their injuries and work loss. But we have no idea what the tracks are doing. We have no idea what the policies read. We just know that it's cost us a small fortune in purses, over $8 million.”

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On that date, the NMRC unanimously passed a motion that the NMHA “is to immediately discontinue the practice of requiring its membership to pay the 1% purse diversion, the $5.00 Starter Fee and the $2.00 PAC [Political Action Committee] fee stemming from their participation in horseracing in New Mexico. The motion also is to instruct all five (5) racetracks to not provide those improper funds to the New Mexico Horsemen's Association.”

According to a letter written by NMRC in-house counsel Richard Bustamante, “stopping that improper diversion of purse money will translate to the addition of approximately $700,000.00 a year to purse money.”

The Commission's order cannot stand for several reasons, the court filing by the Horsemen alleges. They contend horsemen were not afforded Due Process, the commission has no authority or jurisdiction over donation by horsemen owners to the horsemen, and the order was made in retaliation.

According to the Appeal and Motion to Stay filed by the NMHA: “The true motive behind the order/directive is to deprive the Horsemen of all or a large portion of funding because the Horsemen objected to racetracks using 'purse monies' for operational expenses [insurance], Horsemen objected to the Commission canceling race meets and/or shortening race meets, Horsemen refused to pay from purse money the operational expenses of the racetracks, and Horsemen were demanding racetracks keep the tracks and backsides in good, clean and safe condition.”

In addition, the NMHA plans to amend its current civil lawsuit against the NMRC to include additional causes of action for both discrimination against the NMHA and for ethics violation of public officials based on alleged conflict of interests of commissioners.

On Dec. 2, 2020, the NMHA filed a lawsuit against the Commission seeking the return of more than $8 million it alleges the Commission has been collecting improperly from horsemen since 2004 to pay liability insurance for jockeys.

That complaint, a petition for declaratory judgement and relief, also alleges that the commission has improperly ordered horsemen to pay a “gate fee or starter's fee” every time a horse races.

“The costs of operating the 'gate' are and always have been an expense of the association putting on the race, that is a cost or expense of the racino and not the owner or trainer of the horse entering the gate for a scheduled race,” the complaint states, adding that “there is no provision in New Mexico law that allows the Racing Commission to access a fee to horsemen for the starter's gate.”

Finally, the Dec. 2 complaint alleges that the New Mexico Racing Commission improperly demands the Horsemen's Association pay a fee for a license. “The Horsemen's Association does not race horses, or train horses and is a benevolent, non-profit organization and no license is required,” the complaint alleges.

The commission subsequently filed a Motion to Dismiss for lack of jurisdiction and failure to state a claim, to which the horsemen responded on May 3, 2021.

A portion of that response reads: “In a stunning admission, the New Mexico Racing Commission admits they have taken the Horsemen's purse money, and now suggest the Horsemen have no remedy, not even in the Courts of New Mexico. The Commission suggests the Horsemen can come to them and seek relief, which is akin to asking the fox to return the chicken.”

The response concludes: “Horse racing in New Mexico was saved when each racetrack was allowed to institute casino gaming. The plan, as set forth by statute, was that certain proceeds from casino gaming would go to purses for horse racing. Casino gaming was meant to save horse racing, not the other way around. The New Mexico legislature clearly wrote the money was to be used for purses. Purses are not defined as operating costs of the racetrack/casinos. The rule-regulation of the Commission is not in compliance with the statutes. There is no administrative remedy for the Horsemen and they have attempted, to no avail, to get the Commission to stop allowing racetracks/casinos to use part of the purse money for operating costs. The Horsemen are correct about what the money can be used for, that is, for purses. The Horsemen request the law be complied with and the Court determine not only that it has the jurisdiction but the Horsemen have no remedy but through the Courts.”

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The bill, HB199, will be introduced before the House Commerce and Economic Development Committee at 1:30 p.m., local time. It was developed in concert by the NMHA, New Mexico Horse Breeders Association, and Jeff True, president and general manager of Ruidoso Downs.

“The overarching objective of HB199 is to Modernize and Digitize our Pari-Mutuel Domain and allow New Mexico residents to wager on horse racing (our New Mexico content) through the use of their own personal electronic devices, i.e., mobile phones,” Erhard wrote. “There are numerous positive aspects of this legislation, however three notable positive outcomes are as follows:

1. Allow further penetration into our pari-mutuel market, therefore creating more revenue for the state of New Mexico and its legendary horse racing industry.
2. Maintain the current level of on-track revenue.
3. Stop bet poaching by out-of-state ADW groups.”

For more information, the full letter to horsemen is available here.

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This week, we found that feel-good story down in New Mexico. At the age of 91, trainer Rey Marquez saddled his first winner of 2020 at Zia Park on Dec. 3. It was his 13th starter of the year. 

It was “just” a $10,000 maiden claiming race on a Thursday, but truly it was more than that. It was a rare moment of joy bursting forth from this challenging year, both for Marquez himself and all those who know him.

“I don't know how many 90-year-olds are still training,” Marquez admitted during a telephone interview, noting that he turns 92 on Dec. 22. “But me, I still danced three times a week 'til the place shut down due to COVID – I do a mean cha-cha, gal!”

The horse, Lincoln County Kid, won by a length, and Marquez danced his way into the winner's circle with his trademark grin. It was a good return on investment; Marquez had purchased the 2-year-old gelding for $1,500 just six weeks prior. 

He'd taken a chance on Lincoln County Kid, sight unseen, to help out an old friend: a trainer forced to sell off his stock and leave the business. Marquez remembers telling his fellow horsemen that if things in New Mexico didn't start looking up, and soon, “there'd be a lot of tack for sale.”

It isn't just the pandemic that's dealing raw edges to the state's horse racing industry. Uncertainty about the future of racing at Sunland Park has sent some trainers and owners rushing for the border, and a recent lawsuit filed by the New Mexico Horsemen's Association against the state's commission alleges the latter has been improperly collecting over $8 million since 2004 to pay liability insurance for jockeys.  

“We have a really plum relationship with casinos – we get 20 percent of their net – but right now casinos are closed,” Marquez explained. “On Thursday when I won it was an $8,000 purse, so $4,800 goes to the winner. Last year when I won a maiden race my share was $16,000. 

“Everybody's having a hard time here. I just keep hoping for a miracle.”

Compounding the issue is the fact that account wagering is not legal in New Mexico. With COVID restrictions firmly established at Zia Park, no fans are allowed and thus there are also no mutuels clerks; that meant Marquez didn't have a bet down on Lincoln County Kid when the gelding paid $31.60 to win.

“It's not the best place in the world to be at right now,” Marquez said simply. 

Still, New Mexico has been his home since he and his childhood sweetheart Josephine got married 69 years ago, and he doesn't plan to leave now. There are too many happy memories tucked in around every little corner. 

He and Josephine were married for 35 years, and she passed away 34 years ago this month. 

Rey Marquez (Bernadette Barrios photo)

“We had a great marriage, and everybody loved her,” Marquez said, emotion causing his voice to catch. “That woman never met a stranger, and she loved the horses.”

Marquez still lives in Albuquerque, where he cut his teeth working for the local Health Department. He always enjoyed attending the races with Josephine and their friends on the weekends, and one afternoon on the way home from Ruidoso Downs, one friend suggested they buy a horse together. 

The idea was tempting, sure, but with two young children to support it just wasn't financially feasible. 

A few weeks later, fate intervened.

“One morning, two blocks away from the office, a cabbie had a passenger who was in a real hurry trying to catch a flight,” Marquez remembered. “He T-boned me at a light, and I got a nice insurance payout. So I guess you could say I got into racing by accident, literally.”

It took three horses before Marquez saw his silks head out to the track in the afternoon – his first two suffered injuries before they made it to the races.

“It was just bad luck at first,” said Marquez. “I asked my wife, 'Do you think somebody's trying to tell us to stay out of this business?' And she said, 'Hell no, go get us another one!'”

At first, Marquez hired an experienced trainer to condition his horses, then spent weekends on the backstretch helping out and learning as much as he could. Eventually Marquez got his trainer's license, and began operating a “working man's stable.”

Ruben Garcia, a friend who owned several Mexican restaurants in the city, was the first to offer Marquez a chance to begin training full time. Marquez took him up on the opportunity after retiring from the health department at age 62.

It was a family operation from the start. Marquez' wife was his biggest fan, and their daughter Threse ran the shed row for 17 years until her eldest child was school-aged.

He had a few nice runners over the years, led by 1984 Santa Fe Futurity winner Dan's Diablo. More recently, Marquez said the stakes-placed Strike A Spider was one of his favorites.

“This sport has been good to me,” Marquez said. “I wouldn't say I'm prudent, but I got my first nickel in it, and I haven't lost it yet.”

Marquez has saddled 266 winners from 3,488 starters during his career, according to Equibase. He's had a winner nearly every year since 1976, and said he never spent more than $4,000 on a horse. 

For Marquez, it's the thrill of watching his horses thundering down the stretch in front that keeps him rising early every morning to see to the needs of his small stable. The racing game also gives him a chance to stay close to the memory of his beloved late wife. 

“Most of my friends have passed on now,” Marquez said thoughtfully, then deflected that grim reality with humor via a story about his doctor.  

“I eat mostly fried chicken, fried chicken skin, pork … about two to three years ago my regular doctor retired, and the new doctor started talking to me and asked me what I ate. She was surprised, she said, 'There's the rule and there's the exception, and you're the exception!' I guess maybe she's right.”

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