As if the racing industry in the Golden State didn’t have enough problems already.
This is what we’ve learned from racing activist and horseplayer, Andrew Asaro, a member of the Horseplayers Association of North America:
Tomorrow, Friday, January 15, there will be a meeting before the California Horse Racing Board, a regulatory agency. On the docket at this meeting is the following:
“Discussion and action by the Board regarding an increase in the take-out on conventional and exotic wagers on races conducted by quarter horse racing associations, as permitted pursuant to Assembly Bill 246, Chapter 226, Statutes of 2009.”
The HANA organization has been active in the area of takeout legislation, as regular HRI readers are aware. This site believes in the pro bono work being done by HANA on behalf of all horseplayers.
HANA believes, as do we, that any takeout increase is bad for racing. The takeout in a majority of racing jurisdictions is too high already.
Takeout increases, as HANA and do others who understand the economics of parimutuel wagering, have been proven time again to lower handle.
Resultantly, racing, as a sport and industry, has lost many of its constituents and will continue to do so, such is takeout’s immutable law.
The concept is known as churn: The more bettors win, the more they bet in return. Put another way, horseplayers can’t bet what they don’t have. Keeping players in the game is paramount.
Without viable bettors, the interest in racing on any level erodes. An entire industry, from breeders to hot walkers, from the boardrooms of racetracks the Thoroughbred Bloggers Alliance, lives off betting handle.
The president HANA, Jeff Platt, will be at the CHRB meeting speaking out against the proposed increase. Platt will be make the case against high takeout and cite recommendations from some industry subsidized studies.
If you agree and want your voice your opinion, you will be heard. As the e-mail advisory I received suggest, simply cut and paste the message below and email it to the public comments e-mail address of the CHRB.
Be sure that you “sign” it by typing your name at the end of the message, sending the message to: .
In the subject line, type: “Please say no to any takeout increases.”
And, if you have the time, why not provide your take on the subject? Here’s Platt’s*, short and sweet:
“Takeout has an optimal pricing point. The racing industry has spent several hundred thousand dollars for economic studies confirming that fact.
“The studies have shown that when takeout is increased, the long term result is detrimental to racing. Unfortunately, so far racing has chosen to ignore recommendations found in their own studies.
“As a horseplayer and racing customer, I would like to voice my strong opposition to any takeout increase in California, whether it be for quarter horses, harness, or thoroughbred racing.”
Couldn’t have said it better myself. Please send your e mail to the address above. Do it for yourself. do it for all of us.
Then, please, send one betting unit, whatever yours might be; $2, $10, $100, to a legitimate Haiti Relief organization of your choice. Thank you.
* Correction made January 14, 1:36 pm
14 Jan 2010 at 12:19 am | #
Thanks for the kudos John but I can’t take credit for the language in the article. I beleive that was done by Jeff Platt or Dean Towers (the smart guys). I can take a little credit for the coordinated effort by email to the CHRB. It was one of my suggestions some months ago.
I have been pushing for a more aggessive posture on the part of HANA for a long time and I hope this will be a sign of things to come.
It would be nice if California chose to be a leader and not a follower in the area of takeout. In fact they ought to consider dialing back to 14% and 19% takeout rates. Short term thinking on the part of Racing Executives and Racing Officials has gotten us into this mess and as usual the Horseplayers are asked to bail them out with higher takeout.
Tracks are always asking Horseplayers to take a shot and play their tracks so how about them taking a shot with us and lower takeout rates.
The next thing I have to convince them to do is a coordinated campaign against synthetic surfaces in areas with good weather. Fat chance. LOL
14 Jan 2010 at 12:24 am | #
By the way, kudos to you for drawing attention to the tragedy in Haiti. When you see the suffering and misery in Haiti it makes some of the stuff we (I) complain about seem pretty small.
14 Jan 2010 at 02:09 am | #
I have stated the following several times already at this website.
Yes, a reduction in takeout will keep bettors longer in the game, but there is a Catch-22 to a proposed reduction. You all, I’m sure, know that on-track wagering is less that 10% of total handle, thus racetracks only receive a takeout mix on various wagers of approximately 20% on the wagers made on-track; they receive something like 3% to 5% on all off-track wagers (referred to as signal fees). A reduction in takeout will have minimal affect on racetracks putting on the show, and will have a huge affect on the income of off-track facilities that operate racinos, OTB’s, and ADWs (think of the number of racebooks in casinos around the country - a reduction in takeout reduces their profit).
Racetracks obviously have little incentive to reduce takeout, and those racetracks that receive slot revenues (or casino dole) have basically forgotten about takeout.
Churchill Downs is really into casino gambling and ADW wagering, income from takeout of little importance; and once NYRA starts receiving slot revenue they will become more interested in operating as a casino than as a racetrack.
With the situation the way it is (above), it is apparent to me that any initiative to propel a racing organization to lower takeout will be fruitless - isn’t it obvious?
14 Jan 2010 at 04:00 am | #
Andrew,
Well then, good going to Jeff and Dean, and thanks for your efforts on behalf of all of us. We all know the game is bigger than all of us, anyway. Of course, with the horseplayers, THERE WOULD BE NO GAME.
Is there anybody alive out there?
Wendell,
It doesn’t really matter what the tracks and/or simulcasters want anymore. Yes, tracks get to keep more money wagered on track than off. But the simulcast/online market is the only area of growth and the only way that, or any other horseplayer will survive, is to stay in the game.
Everyone knows the current model makes no sense on so many levels. We as a group need to take this one day, one step at a time. Only economic viability will save this game; no amount of promotion could ever have the same effect.
Survival is about two things: Money horseplayers get to keep and re-bet, and the kind of events and exclusivity that serves to get them there in the first place.
Thank you both.
JRP
14 Jan 2010 at 06:10 am | #
JP,
“Survival is about two things: Money horseplayers get to keep and re-bet, and the kind of events and exclusivity that serves to get them there in the first place. “
Perfectly stated and right on the money! And to reiterate a point both you and others have made in the past. Somehow this industry has to find a way to keep the political shenannigans down to a minimum. A co-operative effort that would bring the industry together as one combined with keeping the political BS and confiscatory tactics of any government agency down to an absolute minimum.
As I’ve said before, the tracks in many ways have themselves to blame for the mess they are in. However, all those years ago when somehow, as is usually the case, state governments began raping and pillaging the industry for their “rightful share” again combined with idiots who don’t know anything about the industry trying to justify their phony baloney positions, they managed only one thing. Assine policies have in effect driven a near fatal stake into the heart of a sport that was already on life support at best. Government does not create! It takes! Unfortunately, the politicians involved everywhere cannot stop dipping into the trough, and there’s almost nothing left at the table now.
14 Jan 2010 at 06:10 am | #
The more dollars you allow the customers to take home, the more customers you will have, and they will “last “ longer.
If you do not present the game the customers want you will have fewer customers. The racing managers have run the game for themselves and the customers are a necessary afterthought.
The CHRB should do its job and uphold its primary mission and protect the customer.
More customers would ease everyones problems.
14 Jan 2010 at 07:48 am | #
Rwwupl,
“If you do not present the game customers want,you will have fewer customers”
Let me ask this question of the CHRB:
How many of your customers wanted you to mandate synthetic surfaces?? How many of those customers are former customers today?
14 Jan 2010 at 09:04 am | #
People who last longer are way more likely to expose others to horse racing. Someone who is temporarily tapped out generally doesn’t do any handicapping or watch races. Even if it is done at home on TV or a computer, the more people handicap, watch and play, the more likely family members, friends and even coworkers might get intrigued about the horseplayer’s habit.
Also, if someone plays horse racing longer because they last longer, the less likely they are to spend their disposable somewhere else.
This phenomenon can be seen in slots. It is the reason why slot take is 8% and not 16% or 20%.
14 Jan 2010 at 12:11 pm | #
You are as always right on track.
The damage done by Stronach,
the bankruptcy of NYC OTB, and the Possible
Return of NYRA to bankruptcy has killed this
industry. I will be amazed if any of the tracks
have the money to survive.
The Horsemen are in deep trouble and are just
starting to realize it.
Keep up the excellent work - It is all about Money.
14 Jan 2010 at 01:54 pm | #
Haiti has been kicked hard. Top to bottom. Rich to poor. So many lost, so many hurt, suffering and missing.
But, they, like us, need to be of good cheer. Wall street profits are setting new records. Bonuses derived from all that government money is setting new records. Obama still has hopes of raping America by delivering the health package written by Big Insurance. Stronach settled a law suit so he gets to keep his big 3 tracks. I never doubted his success. All is really true and good in the world where it counts.
Those footprints on your back are from God, carrying the rich, privileged and their governments over the mud holes we live in using us as steps.
Give thanks and give, give, give… The rich and Obama will appreciate every penny.
Racing??? Lol… Don Quixote never beat those windmills, did he? The future shaped by Racing’s decisions have never and do not now include anything positive for the player. Nothing. Even the cheap beer and dogs has been taken back.
Have any of you even looked at the quality of the product being offered today? Honestly???
I support the Red Cross and the Salvation Army. They have stellar track records. Be careful who you give your money to. Most roads paved with dollars lead through Wall street and Big Brother.
Racing has earned its misery and demise. The players have not. Anyone up for a beer and a game of poker? Hope to see you at a table.
My prayers go out to those who are suffering through no choice of their on. No mercy for those who keep drinking the water even though they can see it is being pissed in.
16 Jan 2010 at 08:56 pm | #
http://www.bloodhorse.com/horse-racing/articles/54840/takeout-hike-okd-to-help-simulcast-sites
http://www.bloodhorse.com
Takeout Hike OK’d to Help Simulcast Sites
By Jack Shinar
Updated: Saturday, January 16, 2010 5:18 PM
Posted: Friday, January 15, 2010 8:08 PM
Responding to what track owner Dr. Ed Allred called “a desperate situation” at the state’s simulcast wagering locations, the California Horse Racing Board agreed to hike takeout on Quarter Horse wagers at Los Alamitos Racecourse by 2% on Jan. 15.
Allred told the board during its meeting at Santa Anita Park that roughly half of the projected increase in revenue as the result of the increased takeout would go to the struggling simulcast network. The other 1% would belong to horsemen and the racing association. The board approved the rate increase by a 6-1 vote with commissioner Keith Brackpool in opposition.
Satellite facilities have lost ground in recent years in California due to the increasing popularity of home betting through advance deposit wagering.
CHRB staff calculated the 2009 Quarter Horse takeout rate at 16.09% for win, place and show wagers, and 21.53% for exotic wagers. It projected that the additional 2% withholding would net an increase of $955,338 on win, place and show bets, and $2,847,429 on exotic wagers.
Allred said he was forced to seek the increase because a number of satellite facililites were threatening to close their doors on the night Quarter Horse industry due to the decline in wagering.
“We absolutely have to do something to increase the amount of money to (satellite facilities),” he said. But Allred added, that as a horseplayer, he would be opposed to the action.
“This request is totally alien to my way of thinking,” he said, “but I don’t know what else to do. This is a desperate situation.”
The increase was opposed by Jeff Platt, president of the Horseplayers Association of North America. Industry representatives supported the action.
Under legislation passed in 2009 to allow such hikes in takeout, satellite facilities would receive an additional 1% on the first $50,000 handled per day, provided they accept all available signals from the Quarter Horse racing association. The remainder of the additional revenue would be split between the horsemen’s organization at Los Alamitos and the racing association, according to track representative Rod Blonien.
It was not clear when the increase would take effect. It will remain in place until Sept. 8, closing day of the Del Mar Thoroughbred meet. Allred pledged to keep the board informed of how the takeout increase was affecting overall handle.
That was Platt’s main objection. He told the board that staff projections of revenue increases were “flawed.”
“It assumes handle will remain the same,” Platt explained. “It will not. Every study done shows that as you push up takeout, handle goes down.”
Platt said his group, HANA, has more than 1,500 members who wager more than $65 million annually, and that a primary issue on which tracks they bet on is the takeout rate. He noted that California has maintained the lowest win, place and show takeout in the country.
Afterward, he said his membership “would not take it (the takeout increase) well.” He said that while he understood the reason for the action, the decreasing handle problems tracks are experiencing are their own fault.
“If they were doing a better job of satisfying what customers want, they wouldn’t be in this situation,” Platt said. “It’s just a shame.”
17 Jan 2010 at 06:19 am | #
JP,
I posted this on another column of yours as I hadn’t come back to this yet in regards to the last post from Dennis in Ohio.
“BTW: California, as you know went ahead and raised the takeouts. This from Jeff Platt (HANA) which in one sentence explains the idiocy of entites raising take outs based on “projected” handles. Racing everywhere is is deep trouble as long as this kind of political and corporate insanity reigns, be it NY, Cal or where ever.”
Be it racing, or government in general, raising any fees, taxes, takesouts, etc. based on projected revenues always ends in disaster. How racing has not learned this lesson yet is almost beyond unbelievable!
18 Jan 2010 at 07:33 pm | #
Article is a must read!
I am extremely happy to announce that:
http://www.bloodhorse.com/horse-racing/articles/54900/rachel-alexandra-named-horse-of-the-year?utm_source=BreakingNews&utm_medium=email
Rachel Alexandra Named Horse of the Year
By Evan Hammonds
Updated: Monday, January 18, 2010 11:58 PM
Posted: Monday, January 18, 2010 11:40 PM
Rachel Alexandra was the first filly in 85 years to win the Preakness Stakes (gr. I) and she was the first filly in history to beat males in the Woodward Stakes (gr. I). She won all eight of her starts, dominating her own division with victories in the Fair Grounds Oaks (gr. II), Fantasy Stakes (gr. II), Kentucky Oaks (gr. I), and Mother Goose (gr. I). Against the boys, she added a victory in the Haskell Invitational (gr. I) between the Preakness and Woodward.
By Medaglia d’Oro , Rachel Alexandra is out of the Roar mare Lotta Kim.
Zenyatta, owned by Jerry and Ann Moss, won all five of her starts, winning the Breeders’ Cup Classic (gr. I) in her season finale.
The final tally of first-place votes was 130 for Rachel Alexandra and 99 for Zenyatta. Voting was conducted by members of the National Turf Writers Association, the Daily Racing Form, and the NTRA.