Who says the print media is dead? An investigative report by the Arizona Republic, claims Jeremy and Ronald Simms, brothers feuding about the control of Turf Paradise Racetrack in Arizona, could be jeopardizing the future of the state’s horse racing industry by reducing track business and race purses. (The report is here http://www.azcentral.com/story/news/local/arizona-investigations/2017/05/14/turf-paradise-feud-jerry-simms-ronald-simms-horse-racing-thoroughbreds/97308762/)

That’s a good one. Track owners killing racing. Who’d have thought?

I’ve been to Arizona many, many times, and I have family there. I’ve always had some difficulty trying to describe the politics in Arizona. They had a bad run of elected Governors  when Evan Mecham and Fife Symington were indicted, and one of the more underwhelming Governors in their history in Jan Brewer, who ascended to the governorship after Janet Napolitano bolted for the Obama Administration.

I have a funny aside about Governor Jane Dee Hull, the Secretary of State who moved into the Governor’s office after Fife Symington resigned. I was at a state dinner when, unknown to some of us, Governor Hull was called away after the speeches because part of Northern Arizona was on fire. Once the diners were finished, a band took the stage and the bar was open. Someone propped a smiling, life-sized cardboard cutout of the Governor on the side of the stage, looking at the band admiringly. A few songs and a few drinks into the festivities and one of the people with us says, “She hasn’t moved the whole time she’s been on the stage.” He wouldn’t believe it was a cardboard cutout until he got up close to the stage and saw it for himself. Anyway…

In a lot of ways Arizona is still a “good old boy” state (or good old gal if you count Rose Mofford, Jane Dee Hull, and Jan Brewer) and the Racing Commission fits that bill. The racing commissioners are probably more typical than not of the composition of racing commissions.  If you read their posted bios, you have to wonder how many long time race-goers are just as qualified to be a racing commissioner.  You have an estate planning/corporate lawyer who is a “fan” of thoroughbred racing. There is a financial advisor who has owned horses. A greyhound guy (which is not a bad thing if you are a state with greyhound racing). And another fan who owned horses. No medication experts. No veterinarians. But some good friends of Jerry Simms.

According to the Republic, “two commissioners — Tom Lawless and Jay McClintock — acknowledge close personal ties with Jerry. They socialize at Turf Paradise and one another’s homes. They hang out regularly at an off-track betting bar on Camelback Road, near their homes. A third commissioner, Chairman Rory Goreé, employed one of Jerry’s attorneys for personal legal matters.”

This is not so uncommon either. It’s not unusual for the qualifications of the racing commissioners to be thin, and the relationship between the racing commission and the track management to be, well, let’s just say very friendly.

And would people be shocked that Jerry Simms contributed $15-$20K a year to political campaigns, more in big election years?

You can’t make this stuff up. Again according to the Republic,

“Ron Simms points to his sibling’s past role in a California political-corruption sting, and to financial dealings with a former mob-tied casino operator. Ron alleges Jerry misappropriated millions of dollars from Turf Paradise while using Arizona courts, politicians and prosecutors in a “secret backdoor scheme” to cheat him.”

For his part, Jerry Simms managed to get his brother declared an undesirable with regard to track ownership by the racing commission over the findings of an administrative law judge who found Ron to be a decent man and a victim of a smear campaign by “the Jerry Group.”

Inspiring family, eh?

All I can say, is if we’re depending on a couple of racing fans and a greyhound guy to sort all this out, we may be placing unrealistic expectations on them.  But clearly something is wrong. By every statistic the Republic was able to provide, Arizona racing is in big trouble.

As might be expected, Jerry Simms and Vince Fancia, General Manager of Turf Paradise, offered the same explanations we hear from most track officials. Blame goes to an industry-wide slump that has closed many tracks, Indian casinos have siphoned away gambling dollars, and a shortage of thoroughbred horses has forced tracks nationwide to run fewer races.

But Turf Paradise also insists it is thriving with special promotions such as wiener dog races and a Kentucky Derby Party.  General Manager Francia added, “There is no impact between the Simms brothers’ litigation and the vitality of the Arizona horse-race industry and the future of Turf Paradise.”

I believe that is code for, of course a feud over the way the track is managed and by whom will have an effect on racing. It certainly stretches credulity to insist that sort of distraction is irrelevant.

I’m going to go out on a limb and suggest the weiner dog races are not the answer racing has been searching for.

Turf Paradise is not alone, either as a track in trouble because of the state of racing or as a place where the regulated and the regulators have unnaturally close relationships. We cannot expect the kinds of conditions at Turf Paradise – and plenty of other tracks for that matter – to always lead to decisions that are in the best interests of the horseplayers. In Arizona, there is at least the appearance that what Jerry Simms wants, Jerry Simms gets, and anyone who gets in his way, even his brother, may suffer as a result.

The money Arizona is spending on legal fees will ultimately result in the state wondering if it is worth it just to have horse racing in Arizona. According to the Republic, in just three years, the state has paid $739,248 to private lawyers representing the Department of Gaming in connection with the Simms controversy, according to agency records, with some of that money coming  from racing purses. It won’t take long at those rates for the State to get fed up with the situation, and it is hard to say how they will react when they do.

Arizona, and plenty of other states, need to come to a frank realization that as you turn over the racing commissions to people whose only chance to succeed involves overcoming a long and steep learning curve, especially when racing is in the midst of a crisis as bad as it has ever seen, is a surefire way to ensure the conditions that led to the crisis do not improve. We need racing commissions that are not so intertwined with track ownership that that they are unable to make decisions in the best interest of the other stakeholder groups – racegoers, owners, trainers – instead of reliably putting track ownership ahead of them. We need racing commissions that adequately represent the gamut of stakeholders. We need racing commissioners who come to the job with knowledge in the areas in which they are asked to make decisions.  We need racing commissions that can think outside of the box when that sort of thinking is necessary.

The situation at Turf Paradise may provide us with some comedic relief, but the issues are deadly serious. And if horseplayers and horsemen continue to put up with it, then they deserve nothing more than what they’ve been getting.

One of the great ironies of racing is that the people in charge seem to be the only ones who don’t have the answer to “how to fix horseracing,” at least according to social media. Ask any serious racing fan and you’ll get a “slew” of suggestions on improving the sport. So here goes with my best shot at revitalizing horseracing, in no particular order.

1.Simplify the betting menu and you can drop the take and keep revenues constant or increasing. The question for the racing authorities is simple: how much will adding bets increase handle? If a player brings $200 to the track, will increasing the potential number of pools increase handle or revenue or is he just going to spend his $200 either way? The well known formula for gambling revenue is

Gaming Revenue = Volume x House Advantage

In the case of horse racing volume equals handle and house advantage equals the take. In very simple terms either you have to increase volume or increase the house advantage while keeping volume the same to increase revenue. But, as has been shown in numerous studies, raising the take has the effect of lowering the volume. So the less enlightened jurisdictions raise the take again and lose even more volume.

The ideal for horseplayers is to raise the volume while reducing the house advantage. This gives the good horseplayer a better advantage, while maintaining revenue for the house, a win-win. The problem is it is much harder to do when you have a Cheesecake Factory sized betting menu. Even if a track drops the take on a win bet, they may not realize a net gain in revenue unless people pull out of the other pools, usually pools with a higher take

My hypothesis? Reduce the number of betting pools and if the track does it right, (1) they’ll increase the volume in the remaining pools enough to increase total volume AND (2) increase the churn because people will be experiencing more collections. Increase the volume and you can drop the take and still keep revenue constant. In my opinion the two things have to be done coincidentally.

The fact is that the so-called jackpot bets, like the Pick-6 create little churn. Horseracing is not the lottery, and they are never going to be able to compete with the lottery. How do you compete against walking into a 7-11, saying quick pick and handing a clerk $2 for a chance to win a few hundred million?

If our $200 a day bettor decides to get into the Pick-6, he won’t be able to cover very many of the combinations (assuming there are 8 horses in each race, that’s 262,144 combinations) and he won’t be in a pool where the track picks up the churn. The track will get their percentage of the $200, the guy loses, and starts wondering what he’s doing at the track. Without some sort of addiction, nobody is going to play a game where they are mainly donating their money.

Here is my suggestion for a betting menu:

• Win betting every race;
• Exactas on every race, and no quinellas;
• Combine the place and show pools into a single pool, but pay to the first three spots. This may also cut back on negative pools;
• The take on win, place/show, and exactas would not exceed 14%;
• Trifectas only on races with at least eight starters and superfectas only on races with at least nine starters, and the minimum bet is $1. No 50 cent or 10 cent bets. Lowering the minimums not only dilutes the prices, but it encourages people with no business betting into those pools to switch from the pools where they have a better chance of winning;
• A maximum of five Daily Doubles, three Pick-3’s, one Pick-4, one Pick-5 and one Pick-6 a day, with a minimum bet of $1 on everything but the Pick-6 where the minimum would be at least $2, if not $3. At the very least, you’ll keep the undercapitalized out of the Pick-5 and Pick-6 pools. I used to know a lot of serious Pick-4 players who gave up the bet when it went to a fifty cent minimum. Yes, tracks can get more small bettors into the pool, but if it comes at the expense of the bigger players, the tracks are basically shooting themselves in the foot. The arithmetic is simple. 10,000 bets at 50 cents is less revenue than 6,000 bets at $1. Same for the superfecta. 100,000 bets at 10 cents is less than 11,000 bets at $1. Small tracks, at the least, figured out years ago that dropping the minimums doesn’t increase the volume. And when you hit a big superfecta it can be one of those life-changing collections.
• Stagger the bets so there are not more than two horizontal exotics on a respective race. So Race 1 might be Daily Double/Pick-5, Race 2 — Pick-3, Race 3 — Daily Double/Pick-4, Race 4 — Pick 3/Pick-6, and so on.  This focuses the exotic money;
• No take percentage on the combination/exotic bets should exceed 22.5%, and even that sounds like it should be lower.

And that’s it. Enough exotics to keep the professional player happy, but a focus on the bets the lower capitalized players can win. Increase churn, increase volume, lower percentage, and at least revenue neutral.

2.Cut operating costs. This entails at least two things. One, getting rid of, or at least redesigning, cavernous plants that were built when 15,000 people would attend the races on the weekend. It makes no sense to maintain a huge facility that is all but empty except for two days during the season. Two, automating to the maximum extent possible. There is no reason I should have to wait in a line at the track to bet – ever. If I have a tablet, I should be able to connect to the track ADW and bet, and funding/unfunding my account is as simple as walking to a window. There should be plenty of self-service machines for those without a tablet, and they don’t have to be the big clunky sort. It’s 2017 for goodness sake. I’ve been to restaurants where you barely have to interact with the wait staff once you sit down and there is no waiting to order. Someone brings you water, there is a tablet at the table, you order, you slide your credit card, your meal shows up a few minutes later, and the staff does the obligatory checking on you. You can’t tell me you couldn’t do the same thing at the track. Yeah, there are a few old guys and a few neophytes that the track might have to coddle, but if we’re talking about new customers in the millennial age group, they will love the technology.

3.Make the track a destination for more than racing. Realistically, how do you justify a facility that is used by the public only part of the year for five or six hours a day? You’ve got to have additional revenue streams, and I don’t mean a casino or upping the prices for parking, admission and programs. In fact, general parking should be free, the grandstand admission should be $5 and you should get a $3 betting only voucher in return.

I was at the South Pointe Hotel and Casino recently. It’s on Las Vegas Boulevard,  but about seven miles from the wall-to-wall casino part of the strip, so it has to be relatively self-contained. It had 11 restaurants, a big multiplex movie theater, a large bowling alley, a bingo parlor, meeting rooms, a show room – you could stay there for three days and never get outside, which thinking about it is probably the point. Tracks should have a great sports bar, a nightclub, some good shopping – and I don’t mean just the gift shop – for those who might bring someone who isn’t quite as interested in the horses, good restaurants where you would be happy to stay after the races and eat dinner, recreational opportunities for the kids that are out of any area where people are betting – you get the idea. Design a destination that will generate traffic from morning until late at night. And if people show up for lunch or dinner and only bet a few bucks, that’s still more than the track would get if they never showed up in the first place.

In the right location, a conference center would be a good revenue source. The shops and restaurants should have separate outside entrances, and if you spend any money at one, your track admission is free. The track makes money on a lease, people have a reason to go to the track other than horseracing, and you can accommodate people who wouldn’t go to the track unless they could induce family/friends to come along. The track also becomes a year-round destination if it is designed right.

One last thing. We’re all used to paying a premium at a sporting event, but how about making the prices just a smidge above the normal street price.

4.Standardize the medication list and thresholds nationally. If you believe the anecdotal evidence, a lot of people believe chemical substances are rampant in racing. Whether or not that is your opinion, it makes no sense to have 37 different permissible medication lists and thresholds. Get every jurisdiction together, have them agree on the list and the thresholds, and trainers will not be able to complain about not being aware of differing thresholds between jurisdictions. Same threshold in Arizona as in Florida, same in Nebraska as in California. Between the HBPA, ARCI, and the NTRA, there are plenty of opportunities to convene and facilitate the meetings. There is no reason to usurp the authority of the states to enforce the thresholds, if that is at all a concern, but if there is interest standardizing enforcement, that  can also be put on the table.

We have been enforcing medication/drug standards the same way for decades. To expect a different result is absurd. There are two obvious issues. One is that most of the thresholds are less related to performance enhancement than you might think. The nature of most thresholds is to identify a level which a horse should be below after dosing a certain period before the race. In other words, it is the residual after metabolization. The threshold doesn’t necessarily mean a level above which there is performance enhancement. There are certain medications that have no performance enhancing effect beyond their therapeutic value. While it is fine to set the threshold for those medications and call a positive, it makes more sense to treat those violations as a traffic ticket rather than a felony, and the punishment would not involve retroactive disqualification from the finish position and purse. Like traffic tickets, an accumulation of violations within a specified period of time upgrades the punishment. There is no essential difference between the level of violation for a single positive for omeprazole (Prilosec) and clenbuterol (a bronchodilator) in most racing commission rules, yet abuse of the later can be performance enhancing. Would it really be bad for racing to treat therapeutics that have no real performance enhancing impact differently than therapeutics that have the potential for performance enhancement, and to even treat those differently than illegal substances?

Second, the vast majority of enforcement money is spent on catching violations after the fact. The key for racing would be to prevent a horse likely to test positive from ever entering the starting gate. And no, out of competition testing is hardly the answer for legal substances because testing a horse 48 hours out from a race and finding the presence of a legal therapeutic isn’t of much value, and that is what almost all the tests will show. The very few cases of finding something illegal a few days before a race – and that would be pretty much only anabolics or Class 1 substances – could get the harshest penalties, but that may not be sufficient justification for a costly OOC testing program.

The answer is two fold. There needs to be an automated record keeping system that shows exactly which medicines a horse has been given by amount and time. Those records should be available to the track medical director, who would have the power to flag anything suspect. The medical director could order testing if there is time, or recommend to the stewards that the horse be declared. If the trainer is shown to have followed all dosing and withdrawal requirements any subsequent positive moves into the traffic ticket category. If the trainer and vet have altered the records, they both lose their license for some period that makes an impact and the owner is ruled off the track for a similar period. Any honest owner would tell his trainer that real “cheating” will not be tolerated.

Vigilance and investigation before the fact can go a long way to avoiding post-race positives.

Punish any violation that show a real intent to gain a chemical advantage harshly, but don’t make as big a deal over violations that aren’t performance enhancing, or where trainers made every effort to comply.

5.Consistency in evaluating inquiries or objections. This would only apply in cases where there is potential for disqualification. In my opinion, it would be fine for the stewards to call an inquiry or for the jockey to object, but much like major league baseball, there should be a central location that makes the decision to disqualify or not. If MLB can handle 15 games a night, racing could handle simultaneous tracks running. This is as close as we can come to consistency across the country and should quiet most of the critics. Nobody can successfully make the argument that there is a substantial difference between adjudicating a foul in Maryland vs Florida or Illinois. The only thing we know is that the stewards in each jurisdiction can take the same foul and make three different decisions. You want credibility in racing – it starts with consistency and having a reliable system for making the right call.

And for the most part, the stewards still have most of their responsibilities for enforcing the other racing rules. No doubt they will be irritated with the change, but it’s best for the fans and best for racing.

6.Information should be free. That includes basic past performances and whatever other data the tracks want to provide. If you don’t think simulcast racing forms that sell for $7 or $8 on track don’t keep people out of the game, you don’t understand simple economics. I used to joke that between parking, clubhouse admission, racing form, and a Pepsi, I was down $20 at Saratoga before I made a bet. The “nut” is too high, and tracks need to recognize they’ll get a lot more people betting money at the track if they subsidize information. And it can only apply to people who are attending the races in person so that the tracks aren’t subsidizing other venues.

Ever see the supermarket ads where some food item is on sale for half price? We know the supermarket isn’t making money on the product – it’s what they call a loss leader – but the purpose is to get you into the store so you buy things where they are making money.

Sell the premium products – the serious players will still probably use them –  but make it so that if someone shows up at the track (or my attached sports bar) they can get enough free (or really cheap) information to make an informed selection.

7.Increase customer service. Let me ask a question. Do most of you believe your track or ADW treats you as you should be treated based on your action? While many states do not allow for rebates, they certainly allow comps. I actually witnessed an official at Saratoga seek out a valued player and ask him how many of that day’s giveaways he would need. A small thing, but something that made him feel special. Too many tracks make customers feel like the track is doing them a favor by allowing them to bet the races.

Customer service for new players should be easily obtainable as well. Free betting and handicapping seminars should occur throughout the day. There should be somebody available to help people with betting machines. There should be a customer service representative available throughout the racing day. And they shouldn’t have an attitude.

While I’m thinking about it, POST TIME MEANS POST TIME AND TRACKS SHOULD COORDINATE POST TIMES WITH OTHER TRACKS. And if we make the automation changes, there is no reason to have 35 minutes between posts. 20 minutes should work just fine.

The racetrack has enough crusty characters. The people who work there shouldn’t be among them.

8.Start catering to millennials. According to the Motley Fool,

• Millennials find games like the current slot product uninteresting;
• Millennial gamblers want to be engaged and empowered, and to exert some control over outcomes;
• Millennials prefer night clubs to sitting at a gambling table;
• Millennials are more interested in online gaming, poker and daily fantasy sports (DFS);
• Millennials want skill-based games;
• Millennials want experiences;
• Millennials want to be social;
• Millennials demand fairness.

The question is, why would they not be a lot more interested in horseracing? It can’t be that picking a fantasy team is orders of magnitude easier than coming up with a winner. You want daily action? No problem. Skill-based. Check that box. Exerting control? You make all the decisions.

So what could horseracing do to compete for millennials?

Most of the suggestions I’ve already made fall into that category, like dropping the take or giving away information for free or having it be an entertainment venue.  Millennials still go to Vegas, but for nightclubs and entertainment. Horseracing could learn something about adapting. Do you have to pay for fantasy sports statistics? Of course not. I’m not sure how to get the take low enough to compete with things like fantasy sports, but the race tracks can have the advantages of being social and providing experiences, something you can’t get if your only option is on line.

Somebody has to figure out what creates “fairness,” because the current regime has done little to convince even ardent supporters that it is a clean sport.

9.Racing, like casinos and fantasy sports, has to disengage from the state. They have to become a for profit business that pays taxes based on profits and not a percentage off the top. That would help them they drop the take enough to make a difference.

The state can continue to regulate racing, as they do other gambling ventures, but you have to allow the business to function as a business. They would negotiate with the jockeys and the horsemen, just like other sports do.

What other business pays tribute off the top before accounting for all the operating expenses? Sounds like the old protection racket, doesn’t it.

10.There has to be contraction in terms of the number of racetracks. All things considered, most jurisdictions would be happy to be OTB’s or ADW’s. There are two reasons why that would be a problem. First, there are enough national ADW’s that most of the betting revenue might never stay within the state. Second, horsemen have strong influence, and they will work hard to fund a breeding industry in the state. Without sufficient revenues from handle (and purses), the breeding industry doesn’t survive. Horsemen have also been very effective in convincing legislatures that the breeding industry contributes a significant amount to the state economy.

I understand that, and believe it is a legitimate concern on the part of horsemen. But it has been the case for years that the pool of horses is shrinking. Small fields are too often the rule. On a nine race day, we should have at least 80 horses or so. Last Sunday at AQU there were 62 entries for the nine races. That’s slightly less than seven horses per race. Under my proposal for a revised betting menu, three races would have been trifecta eligible, and only one race superfecta eligible. That is totally unacceptable.

One obvious way to increase field size is to reduce the number of tracks available for racing. This may also have a tangential positive effect. It could be easier to put healthier horses on the track and allow horses with health issues more time to recover.

Contraction doesn’t simply mean watching the smaller, class C tracks close. That is not the problem. They are either the last stop for the marginal racehorses, or playgrounds for the state breeders. No, contraction means eliminating some of the mid-level venues too.

The ultimate outcome should be two-fold: increasing the handle at the remaining tracks – by a lot I might add – and increasing field size.

Have you ever read The Tragedy of the Commons, a famous essay written by Garrett Hardin in 1968? Say you have a common grazing area for cattle and you have one cow and another grazer has one cow. You realize the grazing area has unused capacity, so you bring in a few more cows. Your competitor sees the same thing and he also adds cows. This goes on until there are so many cows they use up the entire grazing area and instead of having long term grazing land, the grazers will have to move to a different area.

Same thing in racing. Each jurisdiction only functions in its own best interest with little regard for the commons, in this case the industry as a whole. No state has a real incentive to give up racing as long as they are making money and the horsemen are happy. In fact, in some states, in order to run a simulcast operation there have to be a certain minimum number of racing days.

But in order for some states to make money they do things that deteriorate the game, like raising the take. It can be a vicious circle.

How do we create contraction?

• Revenue sharing. The tracks that keep running have to help keep the tracks that shut down revenue whole so that they can fund breeding programs. If it works out, volume increases at the active tracks and there should be sufficient revenues to share.
• For those states that have an active track there is no problem running races for state-breds. For the states that don’t have an active track, they can run an abbreviated meet for “state-breds only”  and some of the major stakes in an adjacent state. For example, when Colonial Downs closed, the Virginia Derby became the Commonwealth Derby and was run at Laurel.
• The formula for getting the simulcast signal to states that gave up racing should be at a favorable rate.
• States that lose tracks should pass rules that set up an in-state ADW and that require all bets originating in that state to go through that ADW or be placed at OTBs.
• FOR ILLUSTRATIVE PURPOSES ONLY, here is a hypothetical list of tracks that would remain active. This would not include harness or quarterhorse tracks. Albuquerque, Arlington, Belmont, Canterbury, Churchill Downs, Del Mar, Emerald Downs, Fair Grounds, Golden Gate, Gulfstream, Keeneland, Kentucky Downs, Laurel, Louisiana Downs, Monmouth, Oaklawn, Sam Houston, Santa Anita, Saratoga, Sunland, Tampa Bay Downs, Thistledown, Turf Paradise.  You’ll notice a number of the tracks with attached casinos were left off the list, probably to the joy of the casino owners. 23 tracks nationwide.

There you have it. My proposal to save racing. Not the only ideas and maybe not even the best ideas, but a place to start debate.

The issue of medications and drugs in racing is not going away, and the solutions to this contentious issue are along a continuum from the existing system is fine to we need federal legislation.

Last November I did an article about H.R. 3084, the Thoroughbred Horseracing Integrity Act of 2015. You can read it here. In that piece I pointed out that not only was the Act seriously flawed, but it really may not be about the administration of drug testing at all but about the great boogeyman of horseracing, Lasix. I urge you to take a look at it. The piece is factual and clearly points out why, in the end, the balance sheet tips away from the horseplayer.

Recently two letters to the editor of the Thoroughbred Daily News (TDN) reiterated support for H.R. 3084. Matt Iuliano, executive vice president and executive director of the Jockey Club (a supporter of the bill) took W. Duncan Patterson of the Delaware Racing Commission and the Association of Racing Commissioners International (ARCI) to task for opposing the legislation. (See Iuliano’s letter here). As is common with these things, Iuliano’s first salvo was to accuse Patterson of being part of a campaign of misinformation against the bill.

According to Iuliano, those against the federal legislation say,

It is a campaign notable for the extent to which it mischaracterizes the provisions of H.R. 3084 and for the vehemence of the rhetoric it employs in condemning both the mischaracterized legislation and those who support it.

And it is all premised on the bedrock assumption that everything is totally fine in the realm of Thoroughbred medication regulation.

And then he provides a quote from Patterson that has nothing to do with everything being alright, but instead worries about whether the U.S. ADA medications list would have to be incorporated into the ARCI list.

Mr. Patterson states: “The medications that are approved by USADA are some medications which we do not allow in racing at any threshold level. By the same token, there are other medications we allow that they don’t allow. So our whole medication schedule would have to be revamped under this.”

The major question should be, would the medication schedule have to be revamped and the answer is maybe. Patterson’s statement may sound hyperbolic, but his point is that the new Thoroughbred Horseracing Anti-Doping Agency (THADA) would have the authority to set standards, and none of us knows exactly how the schedule would be revamped, although I think we can all agree that drugs specifically for human and not equine consumption are not in danger of being on the list.

Unfortunately Iuliano takes the first part of Patterson’s statement and turns that into the misinformation campaign. It is, in the glossary of magician terms, misdirection. It is as if Iuliano is saying, watch me discredit someone by accusing them of taking an absurd position while I ignore the basic issue.

Patterson also mentions the cost of testing.

“Currently USADA does 8,400 tests a year. Nationwide, we do 300,000 tests. Travis Tygart, the head of USADA, is obviously very knowledgeable, but when asked what plan he had to ramp up his testing by almost 40 times, he had no plan. When asked about the costs of their tests we were told about $1,000 a test. Currently, we spend, nationally, $30 million on testing. Simple math will tell you we will go from $30 million to $300 million. Who in the hell is going to pay for that?”

Iuliano then blasts Patterson for more misinformation, noting that no U.S. racing lab tests 300,000 samples. Of course, that is not what Patterson said, and all you have to do is read the sentence. Iuliano goes on to say it is all the labs taken together that test 300,000 samples, which is what Patterson said, unless he believes the word “we” in Patterson’s statement means something other than the the agglomeration of racing jurisdictions. Again, Patterson asks the right questions if you’re paying attention. How does THADA ramp up to 300,000 tests when U.S. ADA (the ostensible model) doesn’t have experience doing more than 8,400? How much more is it going to cost than what we are currently laying out? It simply means, we have a whole new ball game with a ton of details to figure out.

As they say on the informercials, wait, there’s more. THADA would be implementing a new out-of-competition testing program. No doubt that would add to the testing numbers (and cost), once we know exactly what that means. Are we talking about random testing of horses not entered for a race? The reason the U.S. ADA does that is to try to stop the use of anabolics and blood doping, and while some use of anabolics does go on (horses suffering from failure to thrive are often given stanozolol) it is most often therapeutic. If a horse has any level of an anabolic steroid in its system post race, it is a positive, so trainers might have to wait 45-90 days if they treated a horse with a drug like stanozolol.

Iuliano then gives us an important fact as stated in the bill. THADA could contract with the existing laboratories (assuming they got certified) to do the testing. What Iuliano doesn’t say is that the bill doesn’t give THADA disciplinary authority – that still stays with the state.So there is a distinct possibility we’ll have the same system we have, except one more oversight agency.  But, the good news is that there will be no problem paying for all of THADA’s work in setting up the system we already have, with the exception they get to make the standards. THADA just charges the states. Plus, Iuliano cites a report from McKinsey & Company that the incremental cost for having the THADA would only be $19.95 – no that’s my April Fools Joke. It would be $60 per start. I don’t have the math handy, but that has to be a pretty big number. What Iuliano doesn’t mention is who would be paying for the new charge. Anyone what to hazard a guess? Your clue is that it begins with horse and ends with players. If you read the bill, it says in plain english, Nothing in this Act requires the United States Government to provide funding for or to guarantee debts of the authority. The funds necessary for the establishment and administration of the Thoroughbred horsearacing anti-doping program shall be paid entirely by the Thoroughbred horse racing industry…

Ultimately, that means the bettors, whether it is through the take or the money spent on live attendance.

Finally, Iuliano takes Patterson to task for contradicting a statement ARCI made in 2011, which stated Lasix is the thing that doesn’t pass the public credibility test, by suggesting Lasix is a necessary drug for racehorses. Yes, the leadership in 2011 said that, although it was not the position of all the racing commissioners, but it is the current ARCI policy that we need to focus on.

He asks,Where in the bill is there an immediate prohibition of race-day Lasix?

The answer is in fact nowhere, but unless Iuliano wants to suggest we are all blind and feeble-minded, the groups in favor of H.R. 3084 are the same groups that oppose race day Lasix, and a strategy where you only have to convince one group – THADA – to ban the medication might just work out better than the current need to convince 39 jurisdictions. ARCI won’t take on the banning of raceday Lasix, so it is a pretty foxy strategy to put all the decision making authority in a place where they may get a sympathetic ear, especially when you looks

Iuliano closes by saying that while ARCI supports the National Uniform Medication Program, local influences and the wide differences in rule making processes among the states reaffirm the need for change. What Iuliano doesn’t say is that some of the “local influences” are highly respected equine pharmacologists like Dr. Steven Barker in Louisiana, who believe some of the standards were not set using valid scientific testing methods. The problem isn’t the local influences  but the potential failures of the existing standard setters, and that is a problem that can be solved without adding another layer of bureaucracy if they simply choose to do their job correctly.

The second letter was from Russell S. Cohen, a veterinarian who also manages Tri-Bone Stable. You can read it here.

Cohen starts out by agreeing with Iuliano that the assumption that everything is totally fine within the realm of thoroughbred medication regulation is totally false. Other than the fact Iuliano implied that Patterson was saying that when there was no indication he was, most of us would agree thoroughbred medication regulation is not fine, although perhaps for different reasons.

Interestingly, while Cohen seems to lament the use of Lasix on his horses, he is compelled to use it because he doesn’t want to be at a competitive disadvantage. Pretty much the same argument I used in college to explain why I needed to be stoned to enjoy the Laser Floyd show at the planetarium.

He also tells a story about one of his horses.

One of our horses recently had a medical issue before a race that required a steroid anti-inflammatory that, due to testing, could not be administered. I consulted with two other vets in the state that has medication rules I am not clear on. The only option that was legal was 10cc of Bute (2000mg) or 10cc Banamine(500mg). I chose Banamine and called both vets but they were at another track. A third vet was called, and walked into the barn with a 35cc syringe filled with 15 cc (750mg) of Banamine. I told this vet who I was, who the horse is, the race he was in and the post time. I questioned him a second time, and then asked the vet again, can you administer 750 mg? I was told that there would be no problem.

Still, I asked the vet to spill in the shed row 6cc, and administer the rest. I revisited this with the other two vets, racing officials and those responsible for the drug testing. I was told by the head of drug testing program that the horse, if administered 750 mg. of Banamine, “would be in serious jeopardy of testing positive,” which contradicted what the vet had told me.

Notice that Cohen used the word “required” to justify using a steroidal anti-inflammatory. Not that it was a treatment option, but that it was required. He also doesn’t mention (but perhaps expects the reader to know) that Banamine and Bute are non-steroidal anti-inflammatories.

He uses the word “legal” to describe application of either of the common NSAIDS. The fact is that both drugs are on the list of approved medications, and the dosage is a recommended dosage (along with a  recommended 32 hour pre-race withdrawal time) to avoid a post-race testing positive and not the legal limit of either medication.

He doesn’t actually mention when the incident with the other vet occurred other than recently, but if he had read my story on Bill Brashears and Banamine (read it here) which was written a year ago he wouldn’t have had a problem with a vet who, if the story is accurate, didn’t actually know what he was doing. Of course, that also doesn’t speak well of Cohen, who as a vet who has been in racing for “over 30 years” shouldn’t have been getting bamboozled by one of his colleagues.

Cohen suggests a three strike rule, like baseball, and at some level this might not be a bad idea. But there actually needs to be an intent to cheat, meaning a trainer knowingly tried to gain an advantage, not like in the case of Brashears where he had a picogram positive even though he was trying to comply with the rule. Plus, you can’t give the racing commissions unfettered authority to wait to tell a trainer about a violation and then treat three violations for the same medication as separate incidents. Otherwise, it would be too easy for the racing commission to just target a trainer for extinction.

Cohen provides two more recommendations, neither of which is an enormous game changer, but would be worth discussing, especially if vets like the one that was trying to get Cohen in hot water are the rule rather than the exception.

Regardless of your position on Lasix, there is a way to resolve this issue without resorting to federal legislation, which from at least one perspective appears to be an attempt by the Coalition for Horseracing Integrity to end run the individual state racing commissions that haven’t so far proven interested in given the anti-Lasix crowd its way.

Let’s focus on two things. Developing a forum where all the stakeholders representing all the various positions agree to work for future regulation of Lasix, and spending a lot more time and effort ensuring the standards in the National Uniform Medication Program  are set using good, scientific testing studies. But let’s not spend any more time on a piece of poorly crafted and thoroughly unnecessary legislation.

So Gary Contessa is doing seven days for having one of his horses test positive for 2.3 nanograms/mL of cocaine. For those not flashing on the measurement, that is 2.3 billionths of a gram of coke. To give you some perspective on a billion:

• A billion seconds ago it was 1984.
• A billion minutes ago the Roman Empire was at its greatest extent.
• A billion hours ago our ancestors were living in the Stone Age.
• And my favorite, if you sat down to count from one to one billion, you would be counting for 95 years.

If it sounds like not much cocaine to have in a 1,400 pound racehorse, that’s right. Of course, given the current standards and the absolute insurer’s rule, the amount of cocaine measured is irrelevant. It is a zero tolerance substance in Florida and Contessa is presumptively guilty for its presence since he was the trainer of record at the time.

You can argue that however harsh the system may seem, trainers know the rules going in and it is their responsibility to make sure they aren’t broken, whether by them or their employees, and for the most part you would be right. Unfortunately, trainers are not able to control for everything that could result in an environmental positive. Everyone from the person who transports the horse, to the state vet, to the person who checks the horse’s identifying tattoo, to the owners in the paddock could potentially contaminate the horse. Should the trainer be held responsible for them as well? A system that cannot discern between guilt by commission and guilt by proxy is broken. I suggest nothing more than putting yourself in Contessa’s position. If you knew yourself to be innocent, do you simply accept the punishment as the cost of doing business?

I went through the pertinent issues in the case of Kellyn Gorder and methamphetamine, and I’m not going to do the same thing here. Instead I’ll focus on three issues that continually come up in these instances.

First is the amount of time it took to resolve the case. The positive was for Jeremy’s Song, a horse that finished second in a maiden race on March 8, 2014. It took close to two years to close the case and that is simply too long. The system is clearly broken if it takes that long to adjudicate a case, especially when the excess time was not related to digging for the truth.

Second, the issue of environmental contamination has to be resolved once and for all. The test used to determine a cocaine positive is for a metabolite of cocaine called benzoylecgonine. In the real world (say professional sports), a human urine test that shows less than 300 nanograms/mL for that metabolite (or 150 nanograms on a retest) is not considered a positive, although that number is an arbitrary result of discussion by scientists. That’s an eye-opener.  A level orders of magitude higher than what was found in Contessa’s horse doesn’t get you busted by football or baseball, or even in some racing jurisdictions. 2.3 nanograms is only indicative of cocaine exposure at some point in the recent past and certainly does not represent a level at which it could influence performance.

The stewards and the racing commission are in over their heads when it comes to something like environmental contamination. Other than the medical directors, who are often not expert in pharmacology, stewards and commissions are forced to look outside for expertise on environmental contamination, and even when they receive the testimony they cannot bring themselves to excuse the trainer. The fear is that the first trainer who gets excused for a Class 1 violation sets a precedent for all future cases. It is racing’s version of Pandora’s box.

In the case of Contessa, the commission resolved nothing. A $500 fine and seven days for a Class 1 substance was essentially a concession that Contessa was not likely guilty of purposely drugging his horse. They emphasized this fact by not changing the result or redistributing the purse. Why would a trainer feed a horse something like cocaine not less than four or five days BEFORE a race, when it could do no good at all for the horse’s performance on race day? It isn’t like an anabolic steroid, where the muscle built is still there weeks after the steroid has been withdrawn. It makes no more sense than taking two ibuprofen on Wednesday to deal with a headache on Saturday. Why would a commission issue such a light punishment for a Class 1 substance if they truly believed Contessa knowingly drugged the horse?

Finally, I’ve argued in favor of doing in depth investigation. Does the commission understand the mechanism by which cocaine can be transferred from human to horse and did they rule this out? Were all the stable personnel tested? Did all the people who had contact with the horse get tested? Racing commissions are among the few places in America where due process only means a trainer gets a hearing before the inevitable hanging, and nothing has to be proven beyond any reasonable doubt. At the very least, a fact-finding mission gives some credibility to the assignment of punishment.

At the end Contessa still has his record stained with a Class 1 violation. The fact that he accepted the punishment was surely indicative that the commission was never interested in letting Contessa off the hook completely. His only real option was to negotiate for the mildest punishment possible.

There is a great cry by many horseplayers to rid the sport of the drug cheats. As laudable a goal as that may be, how do you accomplish it without metaphorically throwing out the baby with the bathwater? Contessa’s case is nothing similar to Kirk Ziadie, but in the minds of those looking to denigrate racing, they both may be equally symptomatic of the problem. If Contessa was not guilty beyond the language of the absolute insurers rule, then racing did itself no favors by insisting he must be punished. Despite consistent statistics to the contrary, racing is still marked with the stain that a great number of trainers are cheaters and that illegal drug use is rampant.

I’ve pointed out a need to do proactive testing and enforcement because obviously once the race is run, all the damage is done. The goal should not be to wait and catch violations after the fact, but to prevent them from ever happening. Don’t the tracks get it that horseplayers are screwed every time a result is posted official and one of the horses in the money tests positive? Don’t they realize the only win for all of us is a clean result? An ounce of prevention, is worth….you know the rest.

Perhaps if Contessa stays clean, in time people will forget the positive for cocaine. Perhaps owners will see it as the environmental contamination Contessa argues for. But as I’ve learned from the trainers I have previously written about, there are owners that will simply not be associated with a trainer with a Class 1 conviction. There is every reason for Contessa to be concerned about the rest of his career, about whether he will miss out on a potential champion because of the stain of the cocaine positive.

Who actually won here? Not the horseplayers, not Contessa, and not horse racing. It’s one more unsatisfying moment in a history of unsatisfying moments.

 

First, congratulations to Paul Matties for winning the 2016 NHC. Given the odds against the players, it is a spectacular accomplishment. I also believe it takes a special kind of horseplayer to thrive in that environment. 53 races over four days, and multiple tracks. While I’ve learned to make money by staying in my element – primarily win and exacta betting at the NYRA tracks – doing well at the NHC would be highly unlikely for me, or anyone, without an incredible amount of preparation. The discipline and commitment it takes to break into the top tier makes the winners more than deserving of the recognition they get.

I was thinking about the NHC during the Super Bowl this weekend. 100 million people were distracted with what can be alternatively called the National Football Championship, or if you are concerned about the NFL suing you for some sort of copyright infringement, The Big Game. On the other hand, other than horseplayers nobody knows or cares about the NHC. I did a “man on the street” survey where I asked random people on the street if they knew who won the National Handicapping Championship. The answers were unsurprising.

Most people thought it had something to do with handicapped people, at least those who didn’t think it was some “goddamn gummint” attempt to raise taxes. The most common response – “Is that like the wheelchair Olympics?”

Obviously expecting anyone outside the community to pay attention to horseplayers would be a massive longshot, but it does point out how horseracing has become a niche sport. It also points out that the common meaning of the word we use to describe the selection process – handicapping – has a generally lame connotation, excuse the pun.

It also is the description of only half the equation. When horseplayers talk about handicapping, they are talking about the process of coming up with selections. The other half is betting. Of course, changing the name of the contest to the “National Horseplayer Selection and Betting Championship” would be even more lame than the current incarnation.

National Handicapping Championship doesn’t have the same brand identity as Super Bowl or World Series or March Madness. If you’re going to come up with a brand name, alliteration is always a good way to go. Horseracing Hootenany is still available.

I know history is on the side of the word “handicapping.” In the old days, like the 70’s – that’s the 1970’s – racing secretaries regularly used weight to even out the ability between horses, essentially giving them a “handicap.” In one of the greatest races of all time, the 1976 Marlboro Handicap, the mighty Forego slipped by Honest Pleasure in the last stride under 137 pounds. Today, if a racing secretary wanted to give a horse 128, the trainer would threaten to pull out. There are no real handicap races anymore. Most races for the best animals are stakes races with fixed weights based on age and sex.

The term handicap is an anachronism. Tracks rarely handicap horses enough to really make a difference, and whatever it is that we do to find horses to bet, it has nothing to do with handicapping a horse. We analyze, we select, and we bet, and we use an archaic term to describe it. It’s a term that came into vogue in horseracing when there were other descriptive words for people with disabilities, and now that there is an entire federal act to cover the disabled, maybe it’s time we came up with our own special word.

What do you think? Are you happy being a handicapper or do we need to come up with a new word for what we do and a new name for the Championship?

The latest state to parlay with Daily Fantasy Sports (DFS) is Florida, and this time the mighty mavens of DFS are looking for a deal instead of a fight.  Rather than going to court again, they are uniting to do what all good Americans with and ax to grind  and money to spare do – buy themselves some legislators.

The big hitters – Draft Kings and Fan Duel – as well as some of the upstarts have banded together to push $220,000 in the direction of some key legislators. All the DFS operators ask in return is the ability to run their games without the interference of government regulation.

Remember the famous words spoken by Abraham Lincoln in the Gettysburg Address?

Four score and seven years ago, our fathers brought forth on this continent a new nation,  conceived in liberty, and dedicated to the proposition that all men are created equal.

Inspiring words, but when Lincoln talked about equality, he must have known it to be a celestrial ideal, an abstraction, because it can never be an absolute that applies without limits to all. If everyone and everything was equal, we would have never developed the Bell Curve and the Supreme Court would have come down on the other side of Citizens United. No constitution can change the immutable law of politics: money talks, and bullshit walks.

This isn’t about whether DFS is a game of skill versus gambling. Anyone who decides it is or isn’t a game of skill is right. Anyone who decides it is or isn’t gambling is right. DFS is whatever you want or need it to be.

There is no aspect of life that comes completely risk free. And there is no betting game that doesn’t have an element of chance. The best poker players, horseplayers, or DFS players will always rise to the top in the long run, but that makes no difference to those who want to equate betting and gambling. Skill becomes irrelevant if it is your mission to make sure everyone “pays to play.”

In the case of DFS, the going rate in Florida would be an initial license fee of $500,000 and an annual renewal fee of $100,000. The best part would be no government interference in the activites of DFS. Are you kidding me? Horseracing is supposed to compete with that?

It gets even better. The Seminoles, who would like a gambling monopoly in Florida, sent $500,000 to Gov. Rick Scott’s political action committee called Let’s Get to Work. It should be more fully titled, Let’s Get to Work Getting Rick Scott More PAC Funding. According to a column by well known Florida writer Carl Hiaasen, Scott recently signed a new gambling compact that would give the tribe’s seven casinos exclusive rights to roulette, craps and blackjack. In return, the state would be guaranteed at least $3 billion from profit-sharing over seven years, beginning in 2017. Of course, the deal is contingent on the legislature approving it, but another few hundred thousand should take care of that.

The best part for Florida legislators looking to fill their campaign war chests is that the Seminoles oppose DFS. This means both sides will spend freely to support or oppose the tribal compact. In the meantime, horseracing gets no help, no equity.

Equality means all the gambling groups – Indian casinos, DFS, horseracing tracks – should all be regulated and taxed so that one doesn’t get the competitive advantage over the other. Let the market decide who succeeds and fails the old fashioned way. As long as horseracing has to pay up front to do business, they will always be at a competitive disadvantage against the other groups. And if DFS and the Seminoles get their deals, the uphill climb for horseracing just got a little bit steeper. What we need is fairness for all, but as long as we are reliant on having to line the pockets of governmental executives and legislators before they decide which laws and compacts they’ll support, horseracing is at a clear disadvantage. Horseracing cast its lot decades ago when the sport was king and profit was plentiful. It’s time to revisit the deal in light of the broad expansion of gambling markets. Forty years ago if you wanted to play table games your option was Vegas, and betting football in the rest country was limited to coded phone calls and conversations with local bookmakers. The times, they have a’changed.

Horseracing will not survive in its current incarnation without some relief, and I don’t mean slot machines or instant racing. I mean internal and external structural relief. Some companies, like CDI, have decided to join the casino business, and other tracks, like the Pennsylvania tracks, Delaware, and Charles Town, have simply become casinos with a side of horseracing. They will all tolerate the horseracing only as long as they have to. Starting with Florida would be fine, especially considering they are apparently wide-open for business, and someone like Frank Stronach may just have the clout to pull it off.

Horseracing simply cannot survive if it is forced to compete on an uneven playing field. If the industry doesn’t get smart and play the game that creates wins for all the stakeholders, then it will continue to deteriorate while DFS and Indian casinos prosper.

 

The New York State Gaming Commission has adopted new rules aimed at repeat violators. Essentially, they adopted the same sort of point system other states use to target trainers with multiple violations. Each violation will accumulate points, with the humber of points per violation dependent on the severity of the offense.  Reaching certain point levels will result in suspension. For example, accumulating 3 1/2 to 5 points would result in a 30 day suspension, while 11 points would bag the offender a year off.

Nobody seems to have any serious opposition to this sort of rule, and I expect you won’t hear any until someone gets pinched for multiple violations of the same medication, much like what happened to Bill Brashears. (http://halveyonhorseracing.com/?p=1351) In any case, if the rule snags offenders looking to gain an edge, it’s a good tool for the toolbox.

What may be more interesting are the proposed rules still under consideration.

This includes an idea to reduce exercise-induced pulmonary hemorrhage incidents. The NYSGC wants to more specifically use episodes of epistaxis (bleeding from the nostrils) to restrict horses from racing. This includes mandating disclosure of such cases to future owners, and requiring endoscopic exams after such episodes. I’m not how the rule will work out in practice, but it doesn’t sound like a bad idea.

The proposed rules also call for something I have advocated for a long time – requiring a log of all medications given to a horse, both by veterinarians (already required in NY) and trainers and their employees. According to an article in the Blood Horse,

“The package of proposed rules also include efforts to eliminate “the unnecessary administration of metabolism-modifying drugs,” [state equine medical director Scott} Palmer told the board, as well as new requirements involving drug prescription renewals, and the effort to ban the administration of drugs “in the absence of an actual medical disorder.”

That last part was targeted at trainer Steve Asmussen who was accused by PETA of unnecessary administration of the thyroid medication thyroxine.

While the medication log is an excellent step, I’ve suggested that for the strategy to be most effective it has to be accompanied by an audit requirement. One of the problems with enforcement is that most of the money and effort goes to post-race violations. By doing, say, monthly audits of the medication log, you have a real opportunity to catch a problem before it manifests in a race result, and this should be priority one. After a result has been declared official, the horseplayer is already screwed if one of the horses has a violation level. I don’t know what the exact division should be between pre-race and post-race testing and investigatory funding, but it currently is too heavily weighted toward getting offenders after the real damage is done.

Putting away bad guys may keep them from committing crimes, and that is one element of enforcement, but I will continue to push for the idea that tracks need to increase proactive efforts to find violators before the bettor is taken advantage of. They need to hire real investigators and not incompetent hacks (http://halveyonhorseracing.com/?p=1742). I’ve outlined a series of proactive efforts in the article about Kirk Ziadie’s suspension (http://halveyonhorseracing.com/?p=2911) and if tracks are serious about protecting bettors, they will start taking the proactive part of enforcement more seriously.

What everyone who works in enforcement knows is that a violation prevented is far better than catching someone after the fact. Make the bettors believe the races are being run fairly and you are on the road to helping the sport rebound, but if all we ever read about is suspending a Kirk Ziadie after 18 violations, racing may have won a battle, but unless it uses all the potential tools, it will never get the necessary public confidence or win the war.