Thursday, December 29, 2011
You’re Entering the Wondrous Dimension of Imagination. . .Welcome to the Spin Zone
SARATOGA SRINGS, NY, December 29, 2011—When it comes to managing the fallout from the takeout error made by the New York Racing Association by which bettors were overcharged by more than $8 million over a 15-month period, it turns out that NYRA and several media outlets know more about spin cycles than a Maytag repair man.
After keeping a low profile for nearly a week during the Aqueduct Christmas hiatus, NYRA CEO Charles Hayward surfaced in a Daily Racing Form interview Tuesday. “I’m the CEO, ultimately I’m responsible,” before adding the qualifier “a lot of people both inside NYRA and the state [had a chance] to review [the statutory reduction] and the bottom line is that we missed it.”
In Thursday’s Saratogian, Adirondack Trust Co. president, CEO and board chairman Charles V. Wait, also a NYRA Board of Trustees member, said the incident was “clearly unintentional,” that “these things happen in business from time to time” and that no one should lose a job over this, only that “it’s something for the [NYRA Board] Audit Committee to review.”
Beneath the headline “NYRA’s Hayward says takeout reduction permanent,” somewhat akin to a NYRA press release on this situation last week (“NYRA lowers takeout)” came a second admission of culpability and a belated apology: “We’re trying to do what we can to fix that for the customers,” Hayward told the DRF, “but it doesn’t eliminate the fact that we made a mistake, for which I apologize.”
Hayward also said that the 2% compensatory takeout reduction on five exotic wagers would be permanent, “not for only 15 months as had been reported by some outlets.” Those outlets, however, were only reporting what the language led them to believe.
A New York State Racing & Wagering Board statement from a hearing on this situation read in part: “Chapter 115 of the Laws of 2008, Section 238 of the Racing Law… the matter remains under review; the Board approved the request to bring NYRA’s takeout on exotic wagers into compliance with statute. Furthermore, the Board approved the following actions in relation to approval of this request and consequences of the use of the excessive takeout rate for approximately 15 months.”
Those who blamed state racing law as being very complex seemingly knew what they are talking about. The language “approximately 15 months” apparently can be taken to mean forever, even if the minimum amount of reduction time proscribed must be in place for at least that length of time. If, then, NYRA does not
request an increase back to higher pre-existing levels, the 24% takeout rate would remain in effect permanently.
The language in the statute relating to the Pick Six is also parsed, the bet defined as a “super-exotic.” All combination bets consisting of at least three elements up to five are termed merely “exotic.” Since NYRA is permitted to charge anywhere up to a 36% rake on the Pick Six—who conjured up that number?—the 26% rate Pick Six bettors were charged during the 15 months in question falls within the parameters of the statute.
HRI has not seen any language that governs what measures the state’s harness tracks or Finger Lakes Thoroughbreds must take to correct overcharges made on their customers. All simulcast organizations were unintended beneficiaries of the illegal rate. The SRWB did, however, instruct the state’s OTB corporations to follow NYRA’s lead to make bettors with documentation whole.
The 15-month error was in all probability an oversight, albeit one of enormous magnitude, falling between the cracks of a betting chasm as wide as the Grand Canyon. But it makes no sense, especially given that Genting’s New York City Casino on the grounds of Aqueduct Racetrack is a sign that happy days may be here again. That the Association would take such a gamble and show such utter disregard of racing law seems unreasonable, although history could contradict that notion.
However, it would have been better had Hayward’s apology come quicker, getting out in front of the flack before setting the spin cycle on high. It would have appeared more sincere had he not pointed out in the DRF story that the Association has been acting without a designated chief financial offer since October 5, or that takeout rates are published daily in the official track program, Daily Racing Form and off-track locations. This was not a time for playing the caveat emptor
Nor was it timely to state that NYRA was “opposed initially” to the 2008 takeout increase as part of the franchise agreement because “it was bad for business.”
And so the action taken by the Association “brings NYRA into compliance with the statutory provisions. NYRA states that they are requesting to lower the takeout rate an additional one percent to 24% to compensate their customers for the prior higher rate. It should be noted that the allowable range set forth in statute for exotic wagers is 15% to 25%. The requested rate is within the allowable range.”
That means that if it wanted, NYRA could request takeout reductions in “exotic” pools as low as 15%. But what are the odds, especially after Hayward declined to comment on whether NYRA would seek a takeout reduction on straight win, place and show wagers, and two-horse wagers such as the exacta and daily double?
Written by John Pricci
Wednesday, December 21, 2011
When Will the Industry Finally Bet On Itself?
SARATOGA SPRINGS, NY, December 20, 2011—It matters not which side of the exchange betting argument you’re on, the fact that several jockeys were recently barred for “race-fixing” in Britain does little to advance the cause of Betfair or any other outfit to bring an alternative form of horse betting to America, even on a limited basis.
In fact, the latest just might have killed the chances of ever getting exchange betting in this country.
But let’s be honest. In games of chance such as horse racing, or other more popular sports in which betting is part of the landscape--albeit underground--there’s always someone willing to take an edge. Just ask Tim Donaghy.
Or ask Mark Cuban if he thinks “the whistle” once cost him an NBA championship. Come to think of it, why do “Jordan rules” exist?
Can any NFL bettor recall an incident when one bad call didn’t tilt the course of a winning pointspread?
Judgment calls, whether tied to gambling results or not, will always be subject to suspicion. Why is it widely accepted that some umpires give pitchers the low strike zone, or others three inches outside? Isn’t a strike a strike? Need I go on?
How about “fixing” a horse race? Try having the trainer not draw the feed tub before his horse races that afternoon? How about having him give the wrong instructions and watch the jockey as he burns the horse out on a needlessly fast early pace?
But the easiest way to make a score at the track, honestly or otherwise, is betting against a bad favorite, something that’s done each and every day without having the outcome predetermined.
But isn’t this why it’s called gambling in the first place?
In a poll taken after
the jockey fix story broke in Britain, seven out of every 10 bettors said they “trusted” horse racing as a wagering sport.
In a Racing Post online story, British Horseracing Association official Paul Scotney said that racing is generally perceived in a favorable light. This came on the heels of a BHA investigation that found 11 people benefitted from betting against losing favorites never allowed to do their best. All were banned for a period of from six months to 14 years depending on their involvement level.
Scotney would not lay the blame on the exchanges, however, telling the Post “betting exchanges offer another way of cheating and that's a fact - anyone can lay a horse to lose. But I think if [exchanges] didn't exist there would still be people trying to cheat simply because there is money involved…
“I do want to stress that we are not talking about racing having a serious problem, but I think it's important people out there see that if there is cheating we will go after [the cheaters…] and throw them out of racing.”
It’s widely accepted horse racing needs to develop other wagering paradigms because handle is down 25 percent in recent years, trending to fall under $11 billion this year, the lowest since 1995. And those are not inflation-adjusted dollars.
If exchange betting, which wagering company Betfair and the Thoroughbred Owners of California are pushing for some time in 2012, is met with resistance, fixed-odds betting is another possibility to help grow handle.
Neither concept will jumpstart sagging handle if not given an excellent chance to succeed. Only through lower takeout could that occur quickly and more effectively.
Takeout on the Betfair exchange in Britain averages about 3%, depending on the size of the winnings. [An exchange pits one bettor against another, establishing a narrow range of market prices upon players can bet either on or against the odds. Takeout is extracted only from the winner.
If enacted in California, the hold would be 10 percent. A big improvement over standard pari-mutuel rates, yes, but whether that number is low enough to truly jumpstart the new concept quickly is arguable
There is another option, recently discussed at the annual Arizona University symposium and widely perceived as a safer “risk” to bettors; fixed-odds wagering. The concept is based on pari-mutuel principles but allows bettors to lock-in the win payoff at the time a wager is placed.
Fixed-odds wagering could stand alone, but given that the industry and many of its fans are resistant to change, it probably should be used to complement the existing pari-mutuel model. Both options can be made available at racetracks, bet shops and online.
By creating a fixed-odds market, overall handle could grow because of the arbitraging possibilities fixed-odds betting affords. It also is a way to eliminate last-minute odds fluctuations since the price you take at the time you bet doesn’t change.
Fixed-odds wagering should be explored as an alternative to exchange betting if the latter isn’t embraced, for whatever reason. It’s time for the industry to take a chance.
Written by John Pricci
Wednesday, December 14, 2011
As “Luck” Would Have It
SARATOGA SPRINGS, NY, December 13, 2011—I must have missed the memo that said David Milch was supposed to create a dramatic piece meant to promote horse racing and attract new fans to the sport.
Hopefully that cause is not lost already, on Milch or anyone else, but neither should it be one person’s responsibility to change the course of an industry that for too long ignored or treated its fans poorly, many of whom have either left or in the process of leaving.
There recently appeared on this site a piece that tried to put the checkered career of the recently retired Patrick Valenzuela in some perspective by recalling a movie line, “wasted talent,” to help describe the life of one of the most gifted race riders the sport has known.
Well, here’s another quote, delivered by George C. Scott as General George S. Patton as he surveyed the human carnage of a battlefield the morning after an epic conflict had been waged: “God help me but I do love it so.”
And yet another, this from an honest-to-goodness Kentucky Derby-winning Hall of Fame horse trainer, Leroy Jolley, who, after the tragic “Great Match” that took Ruffian’s life, said: “We don’t play this game in short pants.”
In that spirit, then, I believe the pilot episode of HBO’s “Luck” captured the game at its core; the highest of highs, the lowest of lows, all in the same race.
Now everyone can sit back, relax, and watch a narrative unfold.
I spoke with one of my daughters the morning after the sneak preview and, somewhat surprisingly, she became emotional. Her favorite part of the game, like mine, takes place on the backside during training hours. For her, it’s about the animals.
In all the reviews I read online, it was very surprising that more wasn’t made of the breakdown; the gruesome view of a bloodied left foreleg hanging by a thread, the mercy killing that followed, all of it commencing with one horrific snap.
“Oh no,” I cried out when I heard it. I've felt the anguished passion expressed by jockey Ronnie Jenkins who explained to the triple-bug apprentice as they walked back to the jocks’ room: “You never get used to it. That’s what the Jim Beam is for.”
If all eight episodes turn out to be as good as the pilot, it’s very clear that series creator Milch, who’s owned horses for a few decades, gets it. This game is dangerous on so many levels and never discriminates between the animals and the people around them.
It’s the textbook backdrop for what lead character Ace Bernstein and his people have in mind; “the perfect Trojan horse,” his intention to turn a failing racetrack into a casino cash cow.
For anyone that didn’t see the pilot episode, pay no attention to the few naysayers and nitpickers. It’s scary how many scenes were pitch perfect, like ‘the Old Man’ sitting in a lawn chair and talking to his grazing “big horse.” Not to mention thr eclectic, talented cast.
Anyone who has seen Dustin Hoffman play Meyer Lansky or Dutch Schultz knows how menacing and volatile his criminal persona can be. Dennis Farina has deceptively great range, from Lt. Mike Torello, to “Bones” Barboni, to “Empire Falls” ’ Walt Comeau.
Who doesn’t love John Ortiz as the “crafty” Turo Escalante? Does Nick Nolte’s “the old man” remind anyone of Frank Whiteley Jr.? Is Richard Kind a jocks’ agent in real life, too? I think I know that guy.
And Gary Stevens, the Hall of Fame jockey? Stevens seems a natural born actor with more than a modicum of intensity in front of a camera.
The racing scenes were amazing, too, snapshots of real life on the racetrack, right down to closing the tailgate on a vet’s SUV. Shedrows were captured authentically. Tight cuts to horses racing, training, galloping; great job. Then there is the postcard that is Santa Anita.
There was one scene that did hurt the eyes, however. It was one of the early shots of a racethat looked more like a morning gallop with horses all over the track than an actual race, something I’m sure went unnoticed to an untrained eye.
The people I really know best in “Luck” are the gamblers,of course, and a degenerate lot they are. I’ve seen more than my share. I grew up, hung out, with guys like them. I guess I was more of a nerdy DG, believing there was more to the game than just action.
Jason Gedrick’s character Jerry, like many of the guys I knew, would bet on anything. I hope Jerry’s character doesn’t become too prominent a player in the piece. Too many sidebars about high stakes poker with “ricers” would distract from the racing storylines.
There was one egregious error that, for a work so rooted in honest detail, was a careless, unnecessary mistake. There were nine runners in the final race of the Pick Six sequence. Hence, the 3 x 1 x 4 x 5 x 3 x ALL ticket would cost $3,240, not $846.
Michael Mann, whose visual style began by watering the streets for scenes shot at night on the original hit series “Miami Vice,” gave that show the slick, modern look that’s become standard fare. The quick-cut, tight shots convey action and urgency at once. I wish Mann were directing all nine episodes.
As the pilot showed, there are many sub-texts that should keep the series moving at a fast pace. When coupled with greed, intrigue and danger, the beauty of Santa Anita should enable "Luck" to continue to be a visual treat as well.
“Luck” is an action drama made by a racetracker for other racetrackers and non-racing fans alike. It conveys the sense of a bubbling underworld of excitement that only horse racing can provide--moments capable of blowing up in a minute flat, going from zenith to nadir and back again.
One final thought: To hell with the learning curve. Viewers that become engaged with “Luck” will want to catch-up on the lingo. Those who aren’t, won’t. Racing’s not going to convert those people, anyway. You don’t choose this game. It chooses you.
Written by John Pricci