New York Racing Association President and CEO Ellen McClain is about ten paces before a firing squad eagerly led by New York Governor Andrew Cuomo.
The mighty hammer crusheth. Even Thor would be impressed by Cuomo’s for-profit, I-get-to-nominate-eight-people on the board for the New New NYRA.
Privatization of the Aqueduct, Belmont and Saratoga is on the move and may the tracks go to the highest bidder. Fall is the season of change, but usually the leaves fall off, not entire trees.
A Cuomo aide told the New York Post, “Why not let Churchill Downs compete with Santa Anita, with Formula One, with Madison Square Garden for the best operation of the tracks? The NYRA model won’t work. It’s flawed, and it’s unable to do the job. Privatizing makes the most sense.”
The problem is the for-profit models haven’t exactly made a soufflé that stands up to gravity. Santa Anita successfully nabs the Breeders’ Cup, but then has track surface problems and waffles under public outcry finally going back to dirt. It really likes the Breeders’ Cup.
Churchill Downs Inc has cut race days and if it weren’t for the Kentucky Derby, would it even be relevant? I’m not going to begin to try and unravel the Gordian Knot of Magna Entertainment. And these are the models that promise to make NYRA better?
Governor Cuomo is set to sign legislation that would create 17-member board where he nominates eight, four chosen by the Legislature and five from NYRA’s current board of directors. If it sounds like a big, hairy mess, that’s because this thing looks like a Yeti.
The source told the New York Post at NYRA, “Nobody really had the best interests of the horses in mind,’’ said the source.
Now the wheels are coming off the Mega Bus. Don’t sit there and pretend a for-profit agency gives a damn about animal welfare any more than a not-for-profit. NYRA racetracks got accreditation for safety. Are these guys going to put the “Have A Nice Day” smiley face on the death screen?
For-profit let Life At Ten walk nine furlongs around Churchill Downs. For-profit companies feed bovines corn and stand them up in muddy paddocks flank-to-flank. For-profit companies juice up chickens so fast their legs can’t support them. Yet this for-profit is going to have the best interest of the animals at heart?
We’ll see what happens when the hoof meets the dirt. Will this for-profit let a filly run around the oval at risk to her health and several others? Keep the $2 million?
Or will this for-profit get it right?
24 Sep 2012 at 11:33 pm | #
Aren’t for-profit business the cornerstone of capitalism? Aren’t the number of not-for-profit business a mere blurp in the marketplace.
The track record of NYRA, a not-for-profit association, is deplorable. I can’t even imagine considering keeping the current NYRA in existence.
A for-profit will return sanity to business decisions which seemed to escape the not-for-profit current NYRA, such as following GAAP; thus six figure purses will be evaluated for their profitability.
Or, would you prefer to stay with the current not-for-profit NYRA and knock the idea of a for-profit NYRA?
24 Sep 2012 at 11:56 pm | #
I think a change is needed. That much is clear. And yes, it is the cornerstone of capitalism.
“Communism works in theory, Marge, in theory,” says Homer.
Hopefully a change in economic tactics helps, but the for-profits don’t exactly have a great record either.
I think we can all agree that it’s a mess. Not unlike a child’s barf-colored attempt at finger painting.
24 Sep 2012 at 11:57 pm | #
FYI, Ellen McClain is not the CEO of NYRA. There isn’t one. That one I won’t blame on you as F. U. Dicker has repetedly made that mistake. However, you could spell her name correctly.
25 Sep 2012 at 12:04 am | #
You know, OTM Al, when I read that in the NY Post story, that struck me as odd. I thought she was the Prez and CFO. Maybe she’s not even the CFO anymore. She’s not going to be anything soon. But with Harvard and Brown degrees hanging on her walls, something tells me she’ll be just fine.
25 Sep 2012 at 12:12 am | #
Said a Fred Dicker inside source: “No one really had the best interests of the horses in mind,” is, on its face, unfair. Anyone who has been in or around the game for any length of time is disgusted by and truly saddened at the sight of a horse in catastrophic distress.
But I can see how it could appear to the non-fan, who can do the math and also knows a little something about human nature: Racing is a game that, for whatever reason, whatever the argument, allows its animals to run with medication on raceday when, in almost every case, R&R;is the best prescription of all. Enter the economics of cost.
Now along comes “free money” where a horse can earn twice the worth it has on the open market. Do you think owners and trainers might be tempted to spot their horses more aggressively than they would under other circumstances?
I spoke with many racetrackers in the aftermath of the rash of breakdowns. Coming from different perspectives, it is interesting to note that no one pointed an accusatory finger at the track surface. It had to be something else.
In the heat of the Salix argument, proponents of the continued use of raceday medication have made the argument that public perception is not a factor.
Well, here’s an example of someone in a position of authority, or speaking for one who is, that doesn’t know one end of a horse from the other.
So, while that quote is hard to digest, or accept, you can see how the situation that prevailed at Aqueduct last winter might look to an outsider who perceives the nature of a problem and has the power necessary to jump up unexpectedly and bite you on the ass.
25 Sep 2012 at 12:17 am | #
Brendan, she was the CFO. Her correct title is President and COO. She was made COO after Hal Handel left that post.
25 Sep 2012 at 12:38 am | #
Thanks, OTM Al!
John, It looks like the new bidders will leverage horse safety as a reason they should get the contract. Great move to win over the public without addressing the reason, which you already said: horses running for twice their value is a worthwhile risk to those willing to cash in and maybe get their un-sound horse claimed.
25 Sep 2012 at 12:52 am | #
Over-racing sound horses will create problems down the road.
What I believe the state is most interested in: Get a private for-profit firm to come in and make NY racing a profitable venuture, that way the state eventually can pull the plug on casino-enhanced purses.
25 Sep 2012 at 01:36 am | #
I have not been on here for awhile,staying away from the horses.To many reasons and problems in the industry.Belmont was my last bet.I will not be t on a NY track,west coast track.or any track owned by CD.I’ll stay with the card games,that way any funny #### that happens is my fault.No stewards to disqualify me from winning.No takeout...free rooms,free food,free air fare,even a free hooker if you are interested.....
As far as CD getting involved in NY racing,will not happen...they see the $$ coming from slots and table games.They are more interested in opening up more casinos.Horse racing to CD is becoming an afterthought...Within a few years there will only be racing at CD for 1 week...Derby Week...insiders are not interested in the Breeders Cup any more...If they can’t make the rules they don’t want it.....it was a great ride I had,but time for a change.....
25 Sep 2012 at 04:12 am | #
Will a for-profit be allowed to adjust takeout to optimum levels to increase handle and make us bettors happy? Or will legislators continue to make the rules?
25 Sep 2012 at 04:37 am | #
I’d like to see a for-profit entity spread out its money-making tactics. For example: look at concessions at ball parks and movie theaters. Exorbitant, but that’s how they make money.
Now, why don’t they lower takeout significantly, put more winnings in people’s pockets and get your racetrack operating revenue from food and entertainment?
I bet you see privy horse players play more off track. But that’s fine. At least they won’t feel disenfranchised. People who win more on-track will likely buy more goodies.
The problem then becomes shoring up poor on-track attendance at Aqueduct and Belmont. Baby steps.
25 Sep 2012 at 05:02 am | #
It has been written here at HRI by Mr. Pricci and others that they will not wager on Parx racing because of the takeout.
Ya know, takeout on a pick three at Parx is 26%. Now, if Parx lowered the takeout on a pick three to 16%, just what is the monetary difference? Well, you would get 13.5% more bucks in your pocket. As an example, if the pick three paid, today, $78 you would (at 16% takeout) receive $89.
A difference of $11; a pick three of $208 today, would pay $236. Indeed, it benefits all of us bettors if takeout is lower, but what about a variable? What if some bloke dumbs on the same pick three numbers you have wagered on? Suddenly, your pick three at one minute to post drops thirty bucks in payoff; or stated another way, your payoff now has a takeout of, say, 40%.
There are three things to be considered: 1) ya gotta pick winners to even consider takeout, 2) no matter what the takeout rate is, if ya don’t pick winners, you lose no matter what the takeout rate is, and 3) the changing odds, to me, make takeout a poor reason to avoid a racetrack. How about this: you like a plodder who’s morning line is 3-1, yet at post time the odds are 6-1 - are you the bettor worrying about takeout now?
In summary, takeout does put more money in a bettor’s pocket, but there are many other variables that make takeout just one of many gripes that bettors complain about - again, just pick the winners and takeout will no longer concern you. Takeout is probably the fifth or sixth reason that Thoroughbred racing is declining, in fact, maybe it isn’t even a reason.
25 Sep 2012 at 05:24 am | #
I think a few tracks should work together and schedule their races so as to not overlap. Track #1 starts their races at the top and bottom of the hour, Track #2 ten minutes later at 10 after and 40 after, Track #3 at 20 after and 50. You’d have a race every ten minutes and they wouldn’t take away from each other. Concievably you could get even six tracks together and run 5 minutes apart. Everybody could be happy, including bettors. The pace would be fast, almost like casino gambling.
I believe Mr. Pricci has suggested something like this in the past. It could probably work better with private ownership. Last Winter I was at Gulfstream for Sunshine Millions Day and they did it with their tracks, they even had a Magna Pick 5 or 6 using multiple tracks. Very interesting.
25 Sep 2012 at 05:29 am | #
Denny, current evil NYRA already has been doing this. They coordinated with Gulfstream in the winter, then with the Keeneland meet and then with Woodbine both before and after the Saratoga meet
25 Sep 2012 at 06:35 am | #
OTM,
You’re right. I had read about it, but, forgot. BTW, I don’t think NYRA is evil, just incompetent in some ways.
I know there are roadblocks, but, would like to see just one major track reduce takeouts noticeably and see what happens.
25 Sep 2012 at 07:02 am | #
#15: You write that you ‘would like to see one major track reduce takeout’.
You should realize that over 90% of wagering is off-track; thus, wagering hubs, racinos, and OTBs rely on their ‘cut’ of takeout. The racetrack receives about four or five cents from every dollar wagered off-track (forwarded to them from the hubs, racinos, and OTBs). If takeout on the 90% plus were reduced, the track would still receive their four or five cents, but the hubs, racinos and OTBs would receive less; their profits would diminish and when it became no longer profitable they would close their doors. So, where do you or I wager, unless we go to the track?
Takeout isn’t the problem, and never has been.
25 Sep 2012 at 08:23 am | #
#16 - So, you’re opposed to a track lowering it’s takeout? What if the track advertised and promoted the reduced takeout? What if handle from all-sources went up dramatically due to lowered takeout? Wouldn’t it be at least worth a try?
25 Sep 2012 at 11:21 am | #
BOM,
When trees fall at a racetrack, can anyone hear it?
The curse of capitalism is greed; that undeniably undesirable underpinning when unregulated and unrestrained.
Once Team Cuomo gets wind of your comparison with cattle and chickens, can horsemeat on the menu be far behind? After all, an inconvenient law can always be rewritten.
If one is the titular President and COO – and there is no titular CEO – would that not make one the effective or “virtual” CEO? When McClain became COO, who performed the function of CFO?
According to Dicker, “Acting Inspector General Catherine Leahy Scott, nearing the end of a five month investigation, concluded that former NYRA CEO Charles Hayward and General Counsel Patrick Kehoe, along with “virtually everyone else in a position of responsibility,’’ knew of a legal requirement to lower the amount the association took from bets being placed at the three tracks but failed to act, said a source with knowledge of the report.”
Isn’t the crux of the matter WHEN they knew AND SIMULTANEOUSLY failed to act?
Was McClain—whatever her title(s) (and however many)— virtually or effectively kept out of the loop? How do wearers of multiple (and sometimes virtual) hats, communicate with themselves, anyway?
I suppose we’ll know the answer once we know what happens when a virtual tree falls in the office of a virtual NYRA executive.
26 Sep 2012 at 01:32 am | #
Drugs destroy horses, people and societies.
“Now along comes “free money” where a horse can earn twice the worth it has on the open market. Do you think owners and trainers might be tempted to spot their horses more aggressively than they would under other circumstances?”
This makes no sense. Only initially, I can see that when what you call “free money” is offered a horse’s worth could be less on the open market than what it could earn. As these monies stay in place, the market will quickly correct itself, and these horses will become worth what they should be in relation to the purses. With respect to the Lasix issue, large purses are not destroying horses, drugs are. Those advocating lowering of purses for the health of the horse are terrible liars, and don’t care anything about horses. Large purses without drugs will only serve to ensure that trainers/owners take great care of their horses, as without proper care, they will not win races. These half measures that are being put in place to get rid of Lasix are laughable. I am not naive, I realize how difficult it is to put the genie back in the bottle. Let the purses rise to the heavens. Ban Lasix, and let the motto be H.O.W.L. (Hay, Oats, Water and Love).
TTT