"Players Up" blogger Indulto is a retired computer programming residing in SoCal and has been betting Thoroughbreds since the days of Kelso, cashing his first ticket at Saratoga while in college.

Indulto is well known in racing's cyber world as a participant on the Ragozin Sheets message board, the PaceAdvantage Forum, Paulick Report, and has made important contributions to the industry's audience as an HRI Readers Blog contributor.

Indulto was active in the formation of the Horseplayers Association of North America and with former HANA colleagues worked on the Players' Boycott of California racing when takeout rates were increased by the legislature there.

Taking his nickname from the King Ranch color-bearer of the 1960s, Indulto now devotes his time to advocate for the recreational player and hobbyist, but prefers lower takeout rates for all rather than subsidized rebates for the few.

Indulto supports the creation of a centralized racing authority to establish uniform rules for racing and wagering and for those standards to be enforced consistently.

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Thursday, September 06, 2012

Reality Bites

As we await the details of the implementation of “New NYRA," a few updates to some topics already discussed here are in order:

ITEM: Neil Milbert of the Chicago Tribune reported that Churchill Downs rejected Hawthorne’s appeal to include its Illinois Derby among the qualifying races for the Kentucky Derby.

“We flew down there for a meeting and it was suggested that moving the date would be of significance," Carey said. "We were willing to move (from the first Saturday in April) to March to be part of it and we got back to them. About three days later we got a letter from (Churchill track President Kevin Flannery) saying 'No, we can't do it.'"

What strikes me as self-defeating about this “redistricting” of horsemen is that -- unlike most UAE Derby starters -- Most Illinois Derby starters have Kentucky Derby aspirations. Can anyone name any U.S. horseman likely to ship to the UAE and back in order to qualify? Couldn’t Aiden O’Brien just as easily ship here to qualify, and get better results to boot?

ITEM: Media focus resumed on the hopefully soon-to-be-announced “New” NYRA leadership. One could almost hear the “Star Wars” theme blasting in Paul Moran’s reference to the State’s chief executive at ESPN, where he discussed the “… void left by the overthrow of a hapless board of trustees larded with those due political consideration and the announced intent to replace it with a hapless board almost purely composed of those due political consideration, the immediate period, post Saratoga, is critical.

“It is important that the inevitably inept be able to recognize and hire those who are highly capable, a difficult equation to balance. This will reveal immediately much concerning the intent of Gov. Andrew (Darth Vader) Cuomo regarding the future of racing and breeding in New York.

“For starters, NYRA needs a battle-tested chief executive officer with chops and the authority to carry out the remainder of a stem to stern retooling that results in more real production and fewer vice presidents. If a nation can function with one vice president, so can NYRA.”

Unfortunately no individuals were identified to play the Luke Skywalker and Hans Solo roles Mr. Moran subsequently defined. Others, however, did mention some possibilities.

ITEM: On August 15, Vic Zast blogged, “… Lou Raffetto, president of the Thoroughbred Owners of California and a person with 30 years experience of operating racetracks successfully in Maryland, New Jersey and Boston, was on the grounds, looking snappy. If the appointment of a new general manager for Saratoga was left up to fans, he’d be the selection.”

ITEM: On August 19
, HRI Executive Editor, John Pricci, wrote; “Do I have any special knowledge about who will take the reins? No, but I hear rumors like anyone else. As for former President Charlie Hayward’s replacement, the names heard most often are Lou Raffetto’s and Bill Murphy’s, by a margin of about 2-1.”

In comment #18 to the preceding, Sean Kerr, who leads a group of increasingly influential supporters of a National Horse Racing Commission called “Bladerunners,” opined; “We need a Jeff Seder - we need someone who has succeeded in taking a business and turning it into an innovative success.

“We need audacity: but that word is antithetical to the political world for the most part. And without audacity - NY racing is doomed.”
I assume Mr. Kerr was referring so passionately to the gentleman interviewed here.

ITEM: On August 28, Bill Finley wrote; “There are a handful of terrific racing executives out there who would likely accept the job, even though the head positions at NYRA have always paid way less than they should. He could hire someone like Lou Raffetto, Bill Nader or Nick Nicholson and the future of New York racing would be in the type of good hands that would immediately ease the worries so many have for the sport.”

While Nader and Nicholson would come from two of the world’s most successful racing operations in Hong Kong and Kentucky, respectively, Raffetto would come from dysfunctional circumstances he did not create, but did not improve.

Some would argue that his credentials prior to his current stint in California have been compromised by his controversial role in continued concert with the organizations that control racing in that state in overwhelming deference to horsemen at horseplayer expense. Nader and Nicholson do not suffer from an anti-horseplayer perception.

Nader might be the best long-term choice, especially in New York where he is already a popular figure among NYRA customers. However, it is that very connection with the past that makes his approval by Gov. Cuomo, a longshot at best despite this statement by Bennett Liebman from March, 2007: “Without Bill Nader, is there a soul at NYRA with any significant management experience?”

But here is where my research got really interesting because the same Google search that found the preceding Liebman article, also found an earlier one from June, 2005.

ITEM: Is a villain’s helmet the appropriate headgear for the governor considering it wasn’t exactly a NYRA baseball Cap that Mr. Liebman was wearing when he wrote; “… everyone knew that Bill Nader and Charlie Hayward were good guys. Why wouldn’t a rational State of New York want these guys to run the racetracks?”

“… There should be an effort made to make the majority of the current trustees leave the Board. There may not be a formal basis for removal of these members, but there should be an effort made to persuade the NYRA Board members who have been on the NYRA board since before 2003 to leave the Board.

They have saddled the NYRA with financial, political, and legal problems that are nearly insolvable. If the State sees NYRA as the Board that sat back and did nothing while letting Barry Schwartz’s son-in-law get NYRA’s web contract without a bid, it doesn’t matter how nice Charlie Hayward and Bill Nader may be. For the good of NYRA, these people should go on their own.”

Was Liebman also referring to Hayward and Nader? Why was Hayward not subsequently attributed with “significant management experience’ more than five years ago?

Finally, Belmont survivor, Street Life, was injured in the Travers and has been retired. Like Bob Dylan asked; “How many times can a man turn his head pretending he just doesn’t see?”

Alpha’s sweep of the Jim Dandy and Travers was the second in successive years, but last year’s winner and Derby/Belmont survivor, Stay Thirsty, never won again. Will this year’s co-winner, Golden Ticket, whose victory followed a nearly three-month layoff, be the most likely three-year-old to annex the Breeders’ Cup Classic? Will he try to do it without a prep again?

Written by Indulto

Comments (14)


Monday, August 27, 2012

Safety for Three Year Olds: Several Suggestions

The inspiration for this piece was provided by fellow HRI commenter, Don Reed, whose commentary on racing spans multiple websites. Not only is he usually good for a chuckle or three, but also for cryptic remarks I enjoy trying to decipher.

In response to Bodemeister’s announced retirement at the “Paulick Report”, and the subsequent comments mourning the dearth of this year’s Triple Crown survivors, he wrote, “The ‘stars’ of 2012 look like the New York Mets.”

I ‘m not sure what he meant, but any mention of the Mets always reminds me of their much-maligned catcher, Clarence “Choo-Choo” Coleman, whose career was extended by MLB expansion. Those Mets filled the void created by the carpet bagging Dodgers and Giants and provided the necessary alternative to the enormously successful Yankees.

It now seems that racing’s 3-year-old stars are also disappearing into the sunset, but not to compete against other equine athletes in California. Rather they’re headed for the sidelines and early retirement; ostensibly due to injuries that appeared after their Triple Crown event appearances. The list includes the winners of all three legs and the second place finisher in the first two.

Paynter, who finished 2nd in the Belmont Stakes before winning the Haskell, was sidelined for the Travers, as was Hansen, the Breeders’ Cup juvenile champion who barely beat eventual Belmont winner, Union Rags, in the 2011 Juvenile.

Both horses subsequently were uncompetitive in the 20-horse cavalry charge on the first Saturday in May. Then so were 13 others. Derby survivors Alpha and Liaison started in this year’s Travers, as did Belmont third, fourth, and fifth place finishers; Atigun, Street Life, and Five Sixteen, respectively.

But there were no participants from the Preakness participants Optimizer, who started all Triple Crown races, returned to the turf on the Travers undercard while the Derby pacesetter, Trinniberg, sprinted in the Grade 1 King’s Bishop.

Gov. Cuomo appeared sufficiently concerned about injuries to $7,500 claimers to initiate an independent study on the issue. Shouldn’t he or his racing staff be scrutinizing what seems to be a career-cancelling circumstance surrounding our classiest competitors, and mandate a first safety step, in what is quickly becoming the Cripple Crown?

A few months ago, HRI executive editor John Pricci once again opined that Triple Crown races needed better spacing. I and a few other HRI regulars took a position against “fixing what isn’t broke.” Indeed, had this year’s Derby and Preakness winner been able to win the Belmont – or even compete in it – the situation might not seem as critical.

But now that so many Triple Crown horses are winding up on only three good legs of their own, people might be more ready to reconsider extending the time between TC events and preps. This is, after all, not a one-season phenomenon.

Despite creating a rivalry resembling that of Affirmed and Alydar, I’ll Have Another and Bodemeister both failed to show up for the Belmont after three races in six weeks for the former and three in weeks for the latter.

Changes to eligibility for next year’s Kentucky Derby may relate to this issue. Starters are expected to be more accomplished as a result of being forced to compete in fewer qualifying events -- in particular the major 9-furlong preps three to seven weeks prior to the Derby.

Will the “lucky” qualifiers be less likely to suffer loss of limb and/or life?

Churchill Downs could force a change just by moving the Derby back to give an extra week’s from the preps offering the most points. Hopefully, Pimlico and Belmont would widen their respective intervals to accommodate a schedule change.

Imagine if racetracks were willing to protect the careers of their athletes? However, I’m not going to hold my breath waiting for Churchill Downs to lead the way while they are the biggest beneficiary of the status quo.

If there’s going to be any movement on spacing, it will have to start with the “New NYRA”. Are you listening, Gov. Cuomo?

Innovation that preserves tradition as needs arise is in order. When the same horse wins the Derby and Preakness, the Belmont would remain at 12 furlongs; even if the candidate scratches.

Otherwise, it could be shortened to 9.5 furlongs; the second leg of a bonus-incentivized New York Championship Series for three-year-olds (NYCS) that starts with the 9-furlong Wood Memorial.

When a less likely classic Triple Crown attempt is scheduled for a Saturday, then the Discovery would be run at 9.5 furlongs as Leg 2 of the NYCS on Sunday. If the Classic candidate does not start, the purse for the 12-furlong Belmont would revert to the Grade 1 minimum.

The 3rd leg of the proposed NYCS would be the Travers at 10 furlongs with spacing similar to that between the first two. The first three finishers in legs two and three would receive bonuses based on in-the-money finishes in prior legs. Once the series proves successful, the Jockey Club Gold Cup at 12 furlongs for 3YOs & Up could be added as a 4th incentivized leg in October.

Eventually, the Metropolitan, Suburban, and Whitney could also comprise a bonus-incentivized NYCS for 3YOs & Up, with in-the-money finishers in the Gold Cup being rewarded for all their “money” placings in any of the six preceding events. Such a progression of races would make 12 furlongs at Belmont the true test of champions and stamina.

The immediate advantage to NYRA would be that a berth in the Wood Memorial starting gate would become at least the second most sought-after in racing; likely requiring special eligibility conditions of its own.

Another would be the occasional opportunity to host a 3-day festival anchored by a Brooklyn-Belmont-Discovery sequence that could be expanded to a mini-Breeders’ Cup type series.

Still another is the potential for the Gold Cup to challenge both the Breeders’ Cup Classic and Kentucky Derby as the most important race in North America.

Owners of championship caliber 3-year-olds would immediately benefit from a potentially safer, realistically more lucrative, alternative path to a divisional championship. It would also lessen the control imposed by CDI through its new Kentucky Derby qualifying process.

Finally, it would keep their horses, and the organization, in the public limelight from April through August.

The much-needed benefit to the industry would be the opportunity to promote the positive steps being taken to offset the recent wave of charges against it of insensitivity to--if not lack of concern for--the welfare of thoroughbred horses.

At the very least, there would be more well-known older talent available to race in subsequent years; possibly fueling an NYCS for older horses. Consider the following scenario:

The Wood winner prevails in both the Derby and Preakness, and his connections start contemplating the appropriate course of action. Not since the Zenyatta–Rachel Alexandra controversy are fans so passionately divided.

Traditionalists square off against the progressives, dominating the media as they await the decision.

Written by John Pricci

Comments (25)


Saturday, August 18, 2012

Rebates v Takeout: On Leveling the Playing Field

August 17, 2012--Bennett Liebman, Governor Andrew Cuomo's consultant on all things gaming, equates gambling on races to purchasing consumer items and regards rebates as “free-enterprise ingenuity.” What he didn’t consider, perhaps, is that racing’s customers aren’t simply consumers, they’re competitors.

Unlike fixed-odds events in casino games and sports betting whose customers “play against the house,” racing’s customers themselves determine what the payoff for winners will be. Thus the “free market” is already built-in to racing and it is being tampered with to make it likelier that bettors with the biggest bankrolls will be profitable.

The “ingenuity” that spawned rebating is the same as that which divined off-shore bank accounts, tax shelters, skimming, and other vehicles to divert funds away from their intended destinations.

Even if the ethics involved weren’t suspect, the capacity of rebating to support money laundering, book-making, and excess Advance Deposit Wagering profits (at host track expense), should be a sufficient deterrent.

The rebate “problem” is a takeout problem. Rebates are possible only when direct takeout rates are too high. If rates weren’t excessive, there would be no “wriggle-room” to subsidize a favored few while fleecing the rest.

Not all venues want to keep the playing field tilted against recreational bettors, but they are reluctant to lower takeout rates; afraid of a precipitous drop in revenue if the rates decrease doesn’t immediately fuel a handle increase. They also fear the formerly-rebated will reduce their play without their virtually insurmountable advantage.

Although I was unsuccessful in accessing any examples, perhaps Mr. Liebman subsequently explored alternatives to selective rebating of individuals that could be considered more equitable approaches for ALL bettors/customers. I can suggest at least three and, hopefully, this article will inspire more.

I’ll use the term “Qualifying Pari-mutuel Pool” (QPP) to represent any pool in which an equitable adjustment to payoffs will be authorized once defined levels of handle are reached:

(1) Paying rebates at an equal rate to all participants of any QPP regardless of an individual’s wager size
(2) Paying bonuses at an equal rate to all winners in a QPP
(3) Dynamically lowering equal direct takeout for all participants in every QPP
(4) Others to be determined

Multiple objectives are involved:

(a) Restore a level playing field on which competitors of all bankroll sizes have an equal opportunity to come out ahead given sufficient skills, information, and good fortune.
(b) Increase long-term handle at levels capable of supporting purses, operations, and capital improvements as well as generate revenue for appropriate taxing entities.
(c) Minimize short-term cost of adjustments to existing process
(d) Increase popularity of racing and attendance through greater opportunity and transparency

What is required is a commitment to continually experiment with takeout strategies to find the “optimal” level of direct takeout in support of (b) for each wager-type/race-condition combination at each race meeting. As the relationship among wagering competitors changes so should the distribution of wagers. Depending on the priorities established, some combination of (1) through (4) may be appropriate.

One approach to experimenting, while attempting to minimize negative initial impact, would be to first concentrate on pools where whales actually participate. The TRPB should already know that by now. Handle thresholds for each member of the QPP subset could be established to automatically adjust takeout rates once handle reaches the next defined level.

Of course, bet cancelation policies would be a factor, but - as the rebaters have already demonstrated – where there’s a will there’s a way. We just need guys in white hats establishing the criteria, ensuring they are legitimately met.

It’s my understanding that rebated players were not affected by the 1% overcharge to NYRA customers that the Administration deemed a “scandal” justifying its intervention. That 1% is dwarfed by the 5% minimum rebate that the average player is effectively also overcharged; making rebates racing’s real takeout scandal.

If the state is going to run racing in New York, then there is no justification whatsoever for its providing an “edge” to a tiny subset of its customers comprised predominantly of professional gamblers that is not extended to the overwhelming majority of recreational bettors that includes New York residents, voters, and taxpayers.

Level the playing field, Mr. Liebman, for horseplayers as well as for horsemen.

It should be clear to anyone who has actually sampled the wealth of Liebman’s work available on the Internet, that the man has carefully considered, clearly articulated, and occasionally debated a preponderance of the issues that need to be addressed by the NYRA Board and executives.

The optimist in me believes that at least some needed reform will result from the Cuomo-Liebman connection. On the other hand, there is no guarantee that the Governor will agree with his advisor’s recommendations and priorities, or that he has the political will to overcome established opposition to some of them.

The Governor, the Senate, and the Assembly should not make their chosen board appointments a “fait accompli” without feedback from concerned parties outside the government, politics, and “Old” NYRA – all of which Liebman himself has been a part. The sooner the Administration resumes open communication with the media regarding the takeover of NYRA, the more likely it is that the entire racing community will benefit from the Governor’s act.

Written by Indulto

Comments (3)


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