Tuesday, August 31, 2010

Texas Racing Dates Under Siege

Texas horse racing is foundering. Handle is declining, purses plummeting, quality racing diminishing, bettors bitching, and Fred-the-Beerman grousing that he doesn’t make tips like he used to. So in an effort to do something – because doing nothing has proved to be a pretty poor model – the Texas racetracks and Texas horsemen put their noggins together and devised a proposal: reduce the number of racing dates in Texas, effectively increasing the size of purses thus attracting better horses and fields thus attracting bettors thus increasing handle.

Sounds sound, huh?

Whoa, Nellie! Hold your horses ...

Apparently, not all Texas horsemen were in on this scheme. And they are not happy. Nor are they quiet.

The Racetracks/Most-of-the-Texas-Horsemen proposed a 48% reduction in racing dates, which includes eliminating thoroughbred racing at Sam Houston Race Park and doing something or other with a handful of Retama race dates. Losing that many racing dates would effectively put the small Texas owner/trainer/breeder out of business. It’s their livelihood. And if it were my livelihood, I’d probably put up a fight, too.

The horsemen dissidents – self-described mushrooms (“They have kept us in the dark and fed us crap for years”) – are valiant defenders of the status quo. True to their beliefs; fighting for the cause. Much like the defenders of the Alamo – except that didn’t exactly turn out too good for those guys.

Out of this opposition emerged a leader, Joe Kerby. He operates a breeding business in Salado, just north of Austin. In an impassioned letter to the Texas Racing Commission, he argues his case for 155 racing dates throughout Texas:

More race dates = higher handle = higher purses.

Apparently there is an assumption that “better” horses generate more handle. Lone Star Park’s Grade III races, with their large purses, handle far less than an allowance race bet at places like Gulfstream Park or Churchill Downs, or the New York and California tracks. Quality horses do NOT beget handle. Reality is that bettors prefer to bet on full fields of reasonably matched horses. Write races that will be more attractive to bettors, and handle will increase.

Well, I’m neither breeder, owner, trainer, nor odd-ball horseman. I’m a bettor. And I know numerous other bettors. And bettors want better. So yes, I’m all for writing races that are more attractive to bettors; quit filling cards with older claiming maidens and non-winners of two. But with purses sitting at $150,000 per day, it doesn’t exactly attract the likes of Afleet Express.

The vast majority of Texas horsemen would prefer to run at less money per day with more opportunity to race

This is a troubling assumption. How can horsemen afford to maintain stables? Good trainers – those that provide good feed, excellent veterinary care, and top notch training –can’t afford an operation such as that. According to trainers Dallas and Donna Keen,

It costs on average $2500-3000 per horse per month to have a horse in race training. Lone Star Park was the only track someone could break even at if their horse didn't win at least one race a month, but they still have to run second in an allowance type race to make enough money just pay for their training.

Owners are reluctant to send their horses to Texas, as their horses have to win every race they’re entered. Trainers see their clientele dwindle. Moving their stables to other states, be it Louisiana or even Iowa, becomes attractive. You got to make some money – you still got to pay the hay guy.

So what does that leave? The little operations – stables that can afford to run at that purse level - and a bunch of skinny fillies? Is that going to fill grandstands and increase handle? Truly, is that our vision of Texas racing? Once so promising – hosting the 2004 Breeders’ Cup where superstars Ghostzapper and Ouija Board graced our presence – only to deteriorate to a sad conglomeration of perpetual claimers?

Additionally, there remains a conspiracy theory that racetracks are using their clout to expand gaming. “It’s all about the slots”, as some vocal horsemen proclaim. Now, I’m a conspiracy theorist at heart – I don’t subscribe to the Lone Gunman and Elvis is still alive, retired after years of working for the CIA and is now living under the name of Buford Winnebago in Ochlocknee, Georgia – but this is a case of economics. Racetracks have to sell a product (horse racing) and if the customers (bettors) don’t buy, racetracks go out of business. If the racetracks go out of business, then none of this will matter anyway.

True, there is a burning desire to bring slots and casinos into Texas by the racetracks, as well as other gambling lobbies. And each legislative session Texas horsemen are optimistic; the Almighty Slots will be the savior of Texas’ purses. Perhaps one day when the Baptist Convention isn’t paying attention, this will indeed happen. However, Texas racing is in trouble and it’s time to find a creative solution now.

One can only hope that a consolidation of race dates would be merely temporary and that there could be some sort of compromise between the opposing factions of Texas horsemen. Dialogue. Innovation. Creativity. Work towards a solution that is good for Texas racing.


Teresa said...

Sounds depressingly like the conversations happening around the country. Thanks for explaining the situation so clearly and in so much detail. Keep us posted.

Sharon Kerby said...

I won't dignify the rest of your commentary with a response, but cannot resist pointing out that Andrea Young, COO and President of Sam Houston Race Park, in speaking of the consolidation plan, said "We need gaming, and this move gives us a runway to do what we need to do at the legislative level.” Are you sure Elvis isn't still alive?

suebroux said...

Ms. Kerby,

This is your livelihood - you should respond, dignified or otherwise. I take no sides; I'm merely a little $2 bettor with access to a computer and keyboard that raises a lot of questions and offers no solutions. This is an opportunity for you to tell me and every other racing fan why we should wager on horses running in Texas, and convince owners why they should run their horses here. If purses are at $180,000 what kind of racing product might the bettor expect??

And as for Andrea Young and her politically incorrect wit, that's a whole 'nother issue. At this writing, the issue I wanted to present wasn't expanded gaming. Horsemen and racetracks have been pushing that issue for a number of years - it's neither new, creative, nor innovative.

The_Knight_Sky said...

I remember when Texas Racing first got started and the optimistic projections were bandied about in the media, "Texas Racing is gonna be Big!". etc.

Well Texas has had many chances since then. The Breeders Cup was its pinnacle and some racetracks have had the proper idea of lowering their takeout rates.

But reductions in the takeout rates in one or two pools for short duration is not going to make much of a difference overall.

Texas must be bolder. The reduction in dates is a start, but they have failed to address the pricing of the product.

Slots will only carry the local racing for 4 or 5 years. When the novelty does wear off with the local crowd, there will be less casino revenues and less horse racing fans coming to attend or wager from home. Is that what Texas wants?

Texas may not be able to offer the marquee horses on a consistent basis but they CAN offer the nation's horseplayers more value for their buck.

That is where Texas can succeed.

Sharon Kerby said...


Some of the "better" horses ship in to Lone Star to run at the big races, but do not stay at the track. And a small increase in handle on "big money" races does not offset the handle lost by running fewer days.

It is true that the vast majority would prefer to see purses spread out over more racing days rather than shorten the days to beef up purses. This the majority opinion - not necessarily shared by the handful of "elite" owners and trainers with big stables. The cost to keep a horse in training is very expensive. Most owners cannot justify that expense without being offered the chance to recoup some of that investment through running races. You quote Dallas and Donna Keen, and make reference to "good" trainers. While in no way do I mean to imply that the Keens are not good trainers, they are not among the top 100 trainers in the country, as are some of the "small" trainers.
To imply that the smaller operations are not successful, or do not take care of their horses is not only ignorant, it is disrepectful.

It's easy for armchair quarterbacks who are not directly involved and/or invested in the racing industry to say "Hey, that sounds reasonable to me". But the consolidation of race dates is NOT a good idea. The Texas Thoroughbred Association, the Texas Horsemen's Partnership, and the Texas Thoroughbred HBPA, who had all initially supported this plan, now agree that this is not a good idea, and have chosen NOT to support it. They have also demanded that Sam Houston run the upcoming race dates that they had requested and were granted.

As far as the $2 bettors are concerned, a lot of them are happy just to cash a ticket, even if it pays $2.10. And you can cash a lot of tickets betting on the favorite in a 5 horse field of "better" horses. I'm not knocking the $2 bettors. They are very valuable, and generate a chunk of live handle during race meets.

But the serious bettors, and gamblers betting on the track through simulcast, are a different breed of cat. If you look at the Horseplayers Association of North America website, you will see that among their top five recommended tracks to bet, are Albequerque and Assinoba Downs. You won't see any Kentucky Derby contenders there, I guarantee, and their purses are considerably lower than those at Lone Star Park.

Lone Star Park is still among the top 40 tracks that HANA recommends for wagering purposes. If Lone Star didn't overcharge for their signal and/or put so many restrictions on it, they would undoubtedly be rated higher. Sam Houston's dirt and turf courses are among the best in the country, and their export signal is very successful. Aside for a number of very successful trainers with smaller stables, Lone Star trainers Steve Assmussen, Bret Calhoun, and Karl Broberg are among the top ten in the nation.

The abiity to maintain a racing circuit in Texas has been a major incentive to race here. We have three Class I tracks within a reasonable distance of each other. As long as we can keep that circuit alive, a lot of owner-trainer relationships will be allowed to stay intact. This means that these owners do not have to incur additional expense from shipping out-of-state, and provides a level of consistency to the horses from not having to adapt to the techniques of different trainers.

It is true that the push for slots has been unfruitful for a long, long time. For what it's worth, I think that the acquisition of ADWs is a much more attainable goal, and would give our industry a much needed shot in the arm.

I totally agree with the comments by The Knight Sky regarding takeout. This factor is indeed huge, and a lowered takeout would be of great benefit to all in the long run. I may be wrong, but I don't think it is a concept that will fly under our current track managements. Too bad.

Sharon Kerby said...

Sorry. I accidentally made my previous post twice, and haven't figured out how to take off the duplicate.

suebroux said...

Thank you for your response, Ms. Kerby. I took care of that little "duplicate" issue for you, as well.

Re: HANA recommendations of the Two Big A's (Albuquerque and Assiniboia Downs), I don't know anybody who happily bets those tracks. Hello, HANA?? Who in your group had the Ruckus Rules and Vinegar Bend exacta in the 8th last Saturday?

Re: Simulcast export fees and signals and other things I know absolutely nothing about. Perhaps I can get Mr. Shubeck to respond. And perhaps that might change when track ownership is transferred to Global Gaming; I'll be sure to buy Michael Chang a very nice tie for his input.

Finally, word on the street about yesterday's TxRC meeting is that SHRP will run in 2011, which means "more of the same". I think that anyone who wants Texas racing to succeed would agree that "more of the same" is probably not the most viable of long-term solutions. There's still a lot of room for creativity and compromise.

Sharon Kerby said...

I was at that TxRC meeting yesterday. SHRP wants to run a 28 day mixed meet in the summer of 2011. I have to give credit to Andrea Young for coming up with the idea of having "mixed weekends", with 2 TB days and 2 QH days. I thought this was very creative. We'll see how it shakes out in a couple of weeks. Thanks for the conversation!

The_Knight_Sky said...

Finally, word on the street about yesterday's TxRC meeting is that SHRP will run in 2011, which means "more of the same".


More of the same will not be a hit with the public. If Texas Racing is to improve it's time to put aside the differences at least for one if not two seasons and see how the nation's bettors like the new format.

With Sam Houston racing again, it is obvious that the horsemen's groups will clamor for slots again instead of at least trying to make the Texas product of a better quality.

Slots or no slots, either way horse racing fan-dom does not grow down in the Lone Star State.
And that's sad.