Fair Grounds Must Pay Record Fine in Clean Water Act Settlement

In an attempt to resolve years of federal Clean Water Act (CWA) violations at its Fair Grounds racetrack in New Orleans, Churchill Downs Louisiana Horseracing Company, LLC, has agreed to pay a $2.7 million penalty–the largest civil fine ever paid by a concentrated animal feeding operation in a CWA matter.

Under the terms of the settlement announced Sept. 29 by the United States Environmental Protection Agency (EPA) and the Department of Justice (DOJ), the limited liability company that runs Fair Grounds must also implement $5.6 million in operational changes and construction projects to eliminate the unauthorized discharges of manure, urine, and wastewater from the track’s stable area.

“We are pleased to announce an agreement with Churchill Downs to address years of CWA violations at its Fair Grounds racetrack in New Orleans,” said principal deputy assistant attorney general Jonathan Brightbill of the Justice Department’s Environment and Natural Resources Division. “This consent decree will stop the flow of untreated process wastewater into the local sewer system, which leads to local waters used for fishing…in a way that recognizes the challenges presented by the racetrack’s urban location.”

According to the joint EPA/DOJ press release, the federal complaint alleges that Fair Grounds violated the CWA, “including the terms and conditions of its Louisiana Pollutant Discharge Elimination System permit. Specifically, the complaint alleges that since at least 2012, Fair Grounds has regularly discharged untreated process wastewater into the New Orleans municipal separate storm sewer system that leads to the London Avenue Canal, Lake Pontchartrain, the Mississippi River, and ultimately to the Gulf of Mexico.”

According to the release, Fair Grounds’s permit prohibits any discharge unless there is a significant rain event (i.e., when 10 inches of rain falls in 24 hours).

“In violation of their permit, Fair Grounds has discharged wastewater after as little as a half-inch of rain, as well as in dry weather,” the EPA/DOJ release stated. “The complaint alleges that unauthorized discharges of contaminated wastewater occurred more than 250 times between 2012 and 2018. The untreated wastewater contains manure, urine, horse wash water, and other biological materials that are ‘pollutants’ as defined by the CWA, the facility’s permit, and the applicable EPA and Louisiana Department of Environmental Quality regulations.”

The release stated that the consent decree “includes a provision requiring Fair Grounds to implement additional remedial measures if these measures do not successfully eliminate unauthorized discharges.”

The settlement was lodged Tuesday in the U.S. District Court for the Eastern District of Louisiana and is subject to a 30-day public comment period. The penalty is due within 30 days of the effective date of the consent decree, the release stated.

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New Jersey Purse Subsidy Cut by Just $5 Million

After a $20 million purse subsidy that was used to bolster purses at New Jersey’s Thoroughbred and Standardbred tracks was left out of an initial budget proposal from Governor Phil Murphy, lawmakers have approval a final budget that will include a $15 million subsidy for the 2021 racing season.

The money will be divided evenly between the two breeds.

“I am pleased that the governor has seen fit to give us back 15 of the $20 million that is going to go support purses next year,” said Dennis Drazin, Chairman and CEO of Darby Development, which manages Monmouth Park. “Since it was taken out of the budget, we have worked hard on this and, fortunately, through leadership in the Senate and the Assembly, as well as a lot of our local politicians who supported the effort, the Governor saw fit to put it back in the budget. We would have liked to have had the full $20 million, but given that he is cutting everybody, I am thrilled that the Governor has our back and recognizes the importance of the industry and how important it is to save a lot of jobs and keep us competitive.”

Though Monmouth will have $2.5 million less to put toward its purse account, Drazin said he didn’t anticipate that there would be a purse cut next year.

Approved prior to the 2019 meet, the purse subsidy was a much-needed shot in the arm for New Jersey racing that brought its purse levels up to a point where they were competitive with neighboring states that benefit from revenues from casinos.

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Horseracing Integrity and Safety Act Passes House

By a unanimous Sep. 29 voice vote, the United States House of Representatives passed a years-in-the-making bill that, if eventually signed into law, will develop and implement anti-doping, medication control, drug testing, and racetrack safety standard programs enforced by an independent authority whose powers would supersede the long-standing state-by-state regulation of the sport.

HR 1754, which has existed in various proposed forms since 2015 and was amended Sep. 9 to match the Horseracing Integrity and Safety Act (HISA) companion legislation that got introduced in the U.S. Senate that same day, passed on Tuesday after five members of Congress from both parties spoke in favor of it while no representatives voiced objections. The Senate version of the HISA (SB 4547) does not currently appear on the near-term calendar of that chamber for voting. But it was introduced by Senate Majority Leader Mitch McConnell (R-KY), who determines which items come up for action, and McConnell has previously indicated he’s strongly in favor of a vote happening prior to the end of the current legislative session.

McConnell’s press office issued a laudatory statement after the House’s passage that did not indicate a timetable for a Senate vote, only noting that “work continues to pass this bill into law.”

If the HISA next passes the Senate, President Donald Trump would then have the opportunity to sign it into law.

The House was meeting Tuesday under a “suspension of the rules” session that is routinely employed a way to speed up voting when a large number of bills have bipartisan support and do not appear to face any objections from voting lawmakers. Debate time is limited to 40 minutes and no amendments can be offered in a rules-suspended Congressional setting.

HR 1754 was one of 26 bills up for discussion in this manner Tuesday, and although no formal vote count was tallied, it was clear from the strong chorus of “ayes” without a single dissenting vote that the measure received the required two-thirds support to be passed.

The low-key, matter-of-fact passage on Tuesday lacked any of the polarizing discourse that has defined the controversial measure within the sport over the past half-decade.

Although numerous industry organizations, including The Jockey Club, the National Thoroughbred Racing Association, various horse-health coalitions, and a number of top-tier racetracks have supported passage of the Integrity Act, other entities, including the National Horsemen’s Benevolent and Protective Association and the Association of Racing Commissioners International, have spoken out against it, claiming at times that their input has not been sought or considered as the legislation has been crafted.

The passage with nary a dissenting House vote on Tuesday also marks a stunning turnaround for a bill that 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) once gave only a 2% chance of being enacted back in 2015.

The five Congress people who spoke in favor during Tuesday’s debate session testified mostly in general terms while advocating for the bill’s passage, and at times even lapsed into congratulatory language before the voice vote came back affirmative, taking the time to thank long lists of industry and governmental supporters.

There was no mention of the nuts-and-bolts implementation of the HISA, nor any detail-oriented talk about one of its most important concessions that helped to achieve a recent degree of compromise: the phasing-out of race-day medications, instead of banning them outright, like previous versions of the bill had sought to do.

Rep. Frank Pallone Jr. (D-NJ), who chairs the House Committee on Energy and Commerce, which had advanced the amended the bill to the House floor by a 46-5 vote, stressed the need for uniformity in the sport’s oversight that he said can only be achieved by doing away with the current model of disparate regulation in which rules are set by the 38 individual states that allow pari-mutuel horse racing.

“The bill establishes uniform standards for medication and anti-doping control, and racetrack safety for Thoroughbred horse racing,” Pallone said. “This will help ensure that we can maintain a safe, thriving horse racing industry. It also applies stronger safeguards and enforcement against performance-enhancing drugs [PEDs]. For a sport in which fans place billions of dollars of bets, trust in the authenticity of competition is crucial. The very legitimacy of the sport is undermined if the competitors and public cannot trust that all racehorses are competing on a level playing field.”

Rep. Paul Tonko (D-NY), who has co-sponsored three different versions of the Integrity Act (including the current amended version), framed the House’s passage of the bill as an opportunity to lock in a better future for horse racing.

“That patchwork system simply doesn’t work. This national approach brings great hope to the integrity of this great industry. If horse racing is to thrive as an industry and once again capture the public’s imagination, we must do better,” Tonko said.

Tonko explained how the new board of the independent authority would include “voices representing a spectrum of perspectives within the horse racing industry.” Yet he also stated how representation on that board would be “subject to strict conflict of interest rules.” He did not offer specifics on how to achieve that difficult balance of inclusion and objectivity.

Several representatives who spoke in favor of the bill referenced an honor roll of America’s great racehorses when championing for passage of the HISA. Yet Rep. Andy Barr (R-KY) spoke instead about the raw economics of the horse industry, which he said contributes between $26 billion and $50 billion (depending on the estimate source) in direct economic impact to the U.S. economy, while employing 988,394 workers.

“Advocating for this industry requires more than just celebrating its proud heritage,” Barr said. “I’ve always believed that the future prosperity of this sport depends on uniformity of the rules of racing.”

Barr, who co-chairs the Congressional Horse Caucus and who, in conjunction with Tonko, has co-sponsored three versions of Integrity Act, said that the current lack of uniformity “has impeded interstate commerce. It has compromised the international competitiveness of the industry. It has undermined public confidence in the safety and integrity of the sport, and the industry is in desperate need of certainty.”

Barr continued: “As a conservative who believes in federalism and states’ rights, I nevertheless understand that the Constitution gives Congress the power to regulate interstate commerce precisely for the purpose of eliminating these kinds of impediments to interstate exchange. And as I’ve said many times as a limited government conservative, this legislation is not about more regulation. It is about creating a single, nationwide set of rules that will result in smarter, more effective, and streamlined regulation for the industry.”

Barr said McConnell’s version of the bill that the House adopted “materially improves on our previous versions by adding a focus on track surface safety and by making reasonable, minor changes that have enabled us to enlarge our coalition of support.”

“I appreciate the willingness of all constituencies within the industry to compromise and to forge a consensus product,” Barr concluded. “This was not easy. But it was necessary to get us to this day [and to] enable the industry to attract a new generation of fans and investors to strengthen the Thoroughbred breed.”

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JCSA Reveals Plans for 2021 Saudi Cup, Issues Update On Maximum Security

In a press briefing held Tuesday, The Jockey Club of Saudi Arabia (JCSA) announced that the 2021 running of the $20-million Saudi Cup will be held Feb. 20, one week earlier than the date for the inaugural edition of the world’s richest race. The announcement was made by HRH Prince Bandar Bin Khalid Al Faisal, Chairman of the JCSA, who, during a question-and-answer session with the media, also addressed the unresolved situation concerning Maximum Security (New Year’s Day) and his former trainer Jason Servis.

Shortly after Maximum Security crossed the wire first in the 2020 running of the race, Servis, his trainer, was among 27 individuals indicted for allegedly giving his horses performance-enhancing drugs. Subsequently, the JCSA announced that his owners would not be paid their $10-million share of the purse pending a further investigation. Prince Bandar indicated that the JCSA will base its final decision on the outcome of the legal preceding against Servis in the U.S.

“We will have to await what are the results of this investigation (in the U.S.) and act accordingly,” Prince Bandar said. “There are only two choices ahead of us. Either Maximum Security and his team are vindicated and therefore we can pay out the prize money and this becomes history. If not, as per our rules, there will be a disqualification and the prize money will go to the horse who finished second and all of the prize money after that will be adjusted. These are the only two options available to us…We are every encouraged that the U.S. is taking a very serious position when it comes to performance-enhancing drugs and we all know what happens in the U.S. matters.”

Despite the Maximum Security situation, the inaugural running of the Saudi Cup and several supporting stakes races was widely viewed as a major success in terms of the quality of horses that came in from all over the world to participate.

“It’s hard to overstate the success of Saudi Cup 2020 when you consider that in year one of a brand-new international racing event, we attracted some of the very best horses, trainers, and jockeys in the world,” Prince Bandar said. “We witnessed 22 individual group or grade 1 winners, who had accumulated an impressive 34 wins at that level between them. That would be an excellent statistic for even the most well-established race meetings in the world, let alone to have that caliber in year one.”

In an effort to continue to build the event, the JCSA has increased the purses of three races on the undercard, which will raise the total amount of prize money paid out over the two-day meet from $29.2 million to $30.5 million. The most significant increase will come in the Saudi Derby, a 3-year-old race run at 1,600 meters on the dirt. Its purse will go from $800,000 to $1.5 million.

About 10,000 fans attended the 2020 Saudi Cup, and Prince Bandar said efforts are underway to increase the attendance in 2020 by about 30 percent. He acknowledged, however, that the COVID-19 pandemic has meant those plans may be subject to change. He anticipated that, at the very least, owners will be able to attend the races come February.

“Take into account that the situation here in Saudi Arabia is a lot better picture than most parts of the world,” he said. “The question is how accessible will the Kingdom be come February to people from all over the world. That largely depends on how the COVID-19 pandemic turns out in the upcoming months. We will arrange for the teams around the horses and the owners to attend. It remains to be seen what we can do when it comes to spectators.”

JCSA Director of Strategy and International Racing Tom Ryan said it was too early to know which horses will be pointing toward the Saudi Cup. But the JCSA’s presentation included a video clip from Bob Baffert, who said he would be pointing Mucho Gusto (Mucho Macho Man) to the race. Owned by Prince Faisal bin Khaled bin Abdulaziz of Saudi Arabia, Mucho Gusto finished fourth this year.

The International Jockeys Challenge, to be held Feb. 19, will also return and will include seven female jockeys, five international male jockeys and two Saudi-based riders. The jockeys will compete for $100,000 plus 15 percent of prize money. The 2020 challenge featured the first ever appearances in Saudi Arabia by female jockeys.

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