NEHBPA Discussions Continue
The NEHBPA board met on Monday night for round two of a discussion on the latest offer from Suffolk Downs for the 2011 meet. There was no resolution to the dispute at the meeting’s conclusion. Via email, NEHBPA lawyer Frank Frisoli said this morning that the board “is continuing to discuss the matter and is seeking to discuss alternatives and modifications with Suffolk Downs.”
As Lynne Snierson reported for the Blood-Horse yesterday, and a Railbird source confirmed, the net simulcasting revenue split remains contentious, and days may be a matter of dissension within the board. The horsemen have sought 100 days of racing this year. Suffolk, which originally offered 67-76 days, has now proposed 75-85 days. What does not seem an issue at this point is the track’s total purse offer of $8.4 million. That’s about the total paid last year, and matches up with the horsemen’s last offer to the track.
Regarding the proposal, Frisoli noted, “we believe [it] remains open.” Contrary to a report yesterday that Suffolk has threatened to shut down in March if the blocked simulcasting signals were not restored by February 26, a source indicated that there is no deadline to the proposal, although it is based on revenue assumptions that may not hold if signals are not restored soon. The board will meet again to discuss the offer on February 23.
9:30 PM Addendum: Lynne Snierson has more on Monday night’s meeting. As mentioned above, days remain an issue. Snierson’s source says that that board is in agreement on 100 days; Frisoli’s response is a study in lawyerly parsing:
“Part of the problem is that the number of live racing days is more important to some of our members than it is to others. As a board, we are trying very hard to do a good job of representing the entire membership. I think the board is doing that.”
Also clarified is the possibility that the purses and days on offer will be cut if simulcasting signals are not restored quickly, as a racetrack source told Railbird yesterday. “[T]he offer Suffolk has on the table now is contingent upon all simulcast signals being turned back on no later than Feb. 27. After that, Suffolk will start cutting race days and total purses,” reports Snierson.
No Consensus (Yet)
The NEHBPA board met on Sunday to discuss the latest offer from Suffolk Downs for the 2011 meet, but a consensus on the terms could not be reached, reports Lynne Snierson:
“There was a lot of talk but there is no agreement yet,†said one board member who asked not to be identified. “Our discussions were mostly about clarification, of both exactly what Suffolk is offering and of what we want and what we can accept. There is no consensus among us at this time, but one may be within reach.â€
Details of the proposal have not been confirmed. Both sides may have moved toward a compromise on purses and days, with Suffolk reportedly upping its offer for total purses to $8.4 million* from $7.5 million and the horsemen giving way on the 100-day meet minimum the group has sought. Snierson indicates that the simulcasting revenue split, which the horsemen have argued should be 50-50, may also still be in contention. The board will meet again tonight to discuss the proposal; updates here as available.
*The total of the new offer from Suffolk is in line with the counter-offer made by the NEHBPA to the track on February 10, which proposed purses based on available revenue and 100 days. A source confirms the track is proposing average daily purses of $103,000 to $110,000 for 75-85 days of racing.
1:15 PM Addendum: More from Snierson:
Suffolk Downs has threatened to shut down in March if the New England Horsemen’s Benevolent and Protective Association and other chapters across the country do not restore simulcast signals by Feb. 26, according to a source close to the negotiations in the ongoing dispute …
A racetrack source said there was no deadline for the offer, but indicated that it was important for the blocked simulcasting signals to be restored quickly or purses and days on offer for the meet were in danger of being cut due to lost revenue. During the weekend of February 12-13, the first full weekend Suffolk was unable to simulcast such tracks as Aqueduct and Gulfstream, handle was down approximately 50% over the equivalent weekend the year before.
Saturday Notes
The Suffolk Downs-NEHBPA dispute has made Paul Daley pessimistic:
Sadly, within the next month, live thoroughbred racing in New England may become the stuff of history books.
Despite the resumption of negotiations on Thursday with the NEHBPA, six simulcasting signals are still blocked at Suffolk Downs. For the second consecutive Saturday, Massachusetts bettors will take their money elsewhere: “My good friend, suffolkdownslova, has to drive all the way to Raynham-Taunton Greyhound Park to place the bets he so lovingly needs.”
Monmouth’s experiment has been mentioned as a model for Suffolk’s future, but a more instructive success might be Tampa Bay Downs, where many Massachusetts horsemen winter. Ed DeRosa highlights just one example of what the track has done well — the reduced takeout Pick 4, up 31%.
Orlando Bocachica, Suffolk’s leading rider in 2009, is hot at Gulfstream.
2/20/11 Suffolk Dispute Update: The track has presented the NEHBPA with a new offer for the 2011 meet. More information will be available on Monday.
Horsemen, Suffolk Talk
The NEHBPA and Suffolk Downs resumed negotiations this afternoon, one week after the horsemen offered the track a proposal for the 2011 meet, and almost four weeks after talks over purses, days, and the simulcasting revenue split initially broke down. No details of the discussion were divulged. Frank Frisoli, the horsemen’s lawyer, sent the following statement:
The NEHBPA conferenced with representatives of Suffolk Downs this afternoon. It anticipates receiving a proposal in the very near future from Suffolk Downs which will be presented to the Board of Directors of the NEHBPA.
The NEHBPA will have no further comments on this matter pending receipt of a proposal.
Track officials have not yet commented.
Hopefully, that the horsemen expect a proposal soon from Suffolk is a sign some progress was made today in finding a resolution to the bitter dispute.
2/18/11 Addendum: Lynne Snierson reports on the Thursday conversation:
“We had a good dialogue today and some of it is encouraging,†said Chip Tuttle, chief executive officer of the East Boston, Mass., track. “There are some places where we still have additional work to do to reach a consensus. We will keep the process moving forward.â€
In light of the past few weeks, that’s a promising statement.
9:00 PM Update: “Constructive” talks continued on Friday …
Later Today
Suffolk Downs and the NEHBPA will resume talks, reports Lynne Snierson:
Frisoli said on Feb. 16 that a conference call among the negotiating teams for both sides has been scheduled for late afternoon on Thursday (Feb. 17)….
“We want to race this year and we want to have a good relationship with them,” said Frisoli. “We have been flexible and they have been rigid. But now they want to talk to us, and that is a good sign.”
Regarding revenue lost to simulcasting signals blocked as part of the dispute, NEHBPA lawyer Frank Frisoli told the Blood-Horse: “Although we believe that Suffolk caused this dispute and should therefore equitably be held accountable for the loss, we are still agreeing to share the loss.†That’s magnanimous.
Elsewhere: A Saturday Afternoon Horse praises the NEHBPA, chastises Suffolk:
Isn’t it the responsibility of the business owner to keep his customers happy? And with that in mind, didn’t management know that the simulcast signal would be pulled if they weren’t serious and sensitive to the horsemen’s interests and concerns? Of course the fans are unhappy, but that’s managements’ problem to resolve.
No, it’s not. We’ve heard several times during this dispute that the track should treat the horsemen as equal partners. If equal applies to revenue, then it applies to taking care of customers. Bettors fund purses — in slots-less Massachusetts, it’s as simple as that — and each time a simulcasting signal is cavalierly cut, or a bet is blocked on an ADW because of a squabble, revenue is lost not only at that moment, but later, because fans leave the game. The more customers alienated, the smaller purses paid — making unhappy horseplayers a problem for the horsemen as much as for the racetrack.
More on Tuttle’s Tuesday letter: “… little to endorse and much to dispute …“
100 Days or No Days
A view from Michigan on the news from Massachusetts and Maryland:
Now it is the Track Management’s that are finally coming under fire from the years and decades of rage that’s been building up from taking all this crud. And the Horsemen & Women have finally said ENOUGH.
We may die, but with us SO WILL YOU….
Now you know what they’ve felt like all those years of your threats. For once some are telling you what will be. For they will decide their future, not you.
Fiery.
I haven’t talked to anyone, on either side, in the dispute over the 2011 meet between Suffolk Downs and the NEHBPA who has framed negotiations as such an existential struggle, but there is an undeniable touch of the apocalyptic in the New England horsemen’s bargaining stance. What’s being fought over isn’t just the terms for one summer, it’s the very survival of Massachusetts racing.
When the horsemen charged in a fact-sheet posted to the NEHBPA website last week that Suffolk wasn’t negotiating with the intention of running a live meet this year, they made it clear they believed there was nothing less at stake.
From Suffolk’s perspective, the horsemen have also made it “clear that the HBPA’s position on the 2011 season is 100 days or no days at all,” wrote the track’s COO in a letter to the NEHBPA yesterday, in which he reaffirmed that Suffolk plans to race in 2011. “[W]e have been consistent about our intention to run a live meet in 2011 and still hope to do so.”
Days could be the sticking point. “From a breeding standpoint, we need a long meet,” New England Stallion Station owner Ken Posco told me yesterday. “I’m with the 100 days minimum.” I asked him why a shorter meet wouldn’t work for the local breeding program. “It will in time,” he replied, “if we get legislation for gaming.” Until then, it’s essential to protect racing as it exists.
That’s the horsemen’s position on days, and they want — not unreasonably — average daily purses at a level that will allow people to care for themselves and their horses. In 2010, horsemen raced without a contract; purse cuts last August left many feeling betrayed and vulnerable. A justifiable determination to avoid the same exposure this year suffuses their statements.
The problem is, as the handle and revenue numbers for the past four years released by Suffolk show, that there isn’t much of a market for 100 days of Massachusetts racing. Since 2007, total handle has dropped more than a third.
In my exchanges with NEHBPA lawyer Frank Frisoli, he’s expressed optimism that the recovering economy will keep 2011 numbers consistent with 2010, and been insistent on the horsemen’s demand for an equal simulcasting split, which would fund purses at the level (approximately $95,000 per day) horsemen seek in the proposal the group submitted to Suffolk last week.
But an equal split would mean less revenue for Suffolk, a tough sell to any business, and certainly so to a track that’s lost $40 million in four years. When I asked Frisoli about this, he replied, “Suffolk Downs controls its expenses.”
In abstract, 50-50 sounds fair. In reality, the horsemen are asking the track to cut back or operate at more of a loss this year for their benefit (a proposition that must seem less attractive to management each day simulcasting revenue is lost to blocked signals and nearby simulcasting parlors).
In our conversation, Posco summed up the situation, the issue at the root of the rest: “Without slots, there’ll be no racing or breeding in Massachusetts.”
It always comes back to slots. Without the prospect of expanded gaming, racing would have ended at Suffolk years ago. With it, though, perspectives skew toward an imagined slots-rich future. Instead of looking for ways to make racing better now, for all involved, the focus is on getting through another year, squeezing what there is from dwindling revenues for 100 days, hoping for a jackpot. The existence of Massachusetts racing depends on it.
Suffolk Responds
It’s not a break in the lengthy impasse, but it is communication between Suffolk Downs and the horsemen — in a letter sent today to the NEHBPA (PDF), the track requests that the blocked NYRA simulcasting signal be restored (and that the NEHBPA ask other horsemen’s groups to restore their signals), and attempts to clarify several issues in the dispute with the horsemen over the 2011 meet. The letter is not a formal response to the proposal submitted by the NEHBPA to the track last week, which management is still considering.
A few points from the letter of particular interest to Massachusetts racing fans:
1) Regarding the blocked signals, which have sent local bettors to nearby simulcasting parlors with all tracks available, costing the track simulcasting revenue (and horsemen the portion that would have gone to purses), Suffolk Downs COO Chip Tuttle notes, “… the most troubling aspect of the conduct of the NEHBPA and other HBPA chapters is the complete lack of respect it shows to our customers…. In all the back and forth of the last month, the HBPA’s disregard for bettors has been most stunning.” Again, track management shows that it’s keenly attuned to how the impasse looks to horseplayers — in a way that the horsemen have not so far — and to the very real risk that some bettors won’t come back when the dispute is resolved. That’s money and support the Massachusetts racing industry can ill afford to lose.
2) The horsemen are arguing for an equal simulcasting split. “We have simply asked Suffolk to share the net profit from simulcasting in the same manner as it is shared in virtually every other racing jurisdiction in the United States,” NEHBPA lawyer Frank Frisoli said last week, pointing to a split over the last three years that has declined from 60-40 to 65-35 according to the horsemen’s numbers. Tuttle puts the split at 62-38 and questions the prevalence of 50-50 simulcasting splits in the industry:
We have anecdotal evidence from other jurisdictions that contradicts your claim and indicates many jurisdictions use similar percentages as we have in our most recent contracts (e.g., Penn National 33% to purse from simulcast revenue; Parx Casino 31% to purse from simulcast revenue; Lone Star Park 40% to purse from simulcast revenue).
It seems noteworthy that the two tracks with slots have a less equitable split. And if the sample splits are representative, it’s another indication that Suffolk has acted in good faith since 2007, despite a significant drop in total handle.
3) Raynham/Taunton owner George Carney has said that he’s interested in picking up racing days for his Brockton Fair track (closed since 2001) if fewer than 100 days were run at Suffolk this year. Noting concerns about purse inequities and safety, Tuttle suggests the track could work with that:
We remain open to any discussions that would give your members additional opportunities to race locally, especially if such opportunities could offset our current schedule and reduce the duration of keeping our barn area and training facilities open.
A two-track Massachusetts racing circuit in 2011? That would be a twist in this drama, and one that would suit Suffolk, which has proposed a shorter meet of 67-76 days. A reduced calendar would better fit the current market, but the horsemen are reluctant to agree to anything less than the state-mandated minimum of 100 days, fearful the cut would become permanent.
10:00 PM Addendum: More from Lynne Snierson in the Blood-Horse:
Frank Frisoli, the attorney for the NEHBPA, said that he had received the letter Feb. 15 and sent a reply to Tuttle the same afternoon. He did not discuss the details of the horsemen’s response but did say, “This appears to be heating up. I don’t know if we’re headed to court or to a resolution.”
Let’s hope things are moving toward resolution.
Betting Elsewhere
Not only was this past Saturday one of the first big days of Kentucky Derby preps, it was the first that local bettors couldn’t wager on several popular tracks through Suffolk Downs due to the dispute with the NEHBPA over the 2011 meet. Unsurprisingly, many opted to go elsewhere. “Not a lot of cars in the Suffolk Downs parking lot. Definite change from Saturday afternoons before the mess,” tweeted Jen Montfort, a CANTER New England volunteer.
A few of the missing cars were surely parked at Rockingham, less than 40 miles away in New Hampshire. Tom Gagney in the mutuels department didn’t have attendance numbers, but he did say that the former harness track turned simulcasting hall enjoyed a jump of approximately 30% in handle over the previous Saturday. “It went from $250,000 to $320,000,” said Gagney.
At Suffolk Downs, track officials indicated simulcasting handle on Saturday and Sunday was down about 50% from the equivalent weekend a year ago.
Officials at nearby Plainridge and Raynham simulcasting parlors, as well as Twin River Casino in Rhode Island, were unable or unavailable to comment.
At least one bettor went to Mohegan Sun* in Connecticut, where he reported being given a $50 voucher and a rebate on his wagers. “[T]he money that is leaving the state of Massachusetts during the days leading up to Triple Crown is huge,” warned Robert Antonelli in a post on Facebook.
The money leaving is also lost to the Suffolk purse account. So long as the dispute drags on, the less there will be this summer to fund purses, which are a point of contention along with days and the simulcasting split.
There’s little to suggest the impasse will end soon. The NEHBPA presented a counter-proposal to Suffolk’s January 26 offer last Thursday. The same day, Suffolk threatened to sue the group, NEHBPA lawyer Frank Frisoli told the Blood-Horse. As of early this afternoon, the horsemen had not received a response to their offer. “We’re still evaluating the proposal,” said Frisoli, is the last the group heard from track management, and that was on Friday.
Meanwhile, Suffolk has cut Wednesday from its simulcasting schedule because of revenue lost since the start of the dispute, when the NEHBPA pulled its permission for the NYRA feed. Horsemen’s groups in Florida, Maryland, Ohio, and Oregon later pulled feeds in solidarity, blocking six tracks. Suffolk is now open for simulcasting only Thursday to Monday.
8:45 PM Addendum: More from Lynne Snierson on the simulcasting cut: “A racetrack source said that staffing has also been cut back.”
*2/15/11 Update: The Mohegan Sun racebook did see a small spike in total handle on Saturday, said a casino spokeswoman, however, “[the racebook] can’t directly correlate the slight increase to that of the Suffolk Downs simulcast block in Massachusetts.”
Sharing the Risk
Following up on a question about the proposal made by the New England horsemen to Suffolk Downs on Wednesday and the potential risk of racing this year without purse guarantees, NEHBPA lawyer Frank Frisoli replied:
The proposal just advanced by the NEHBPA offers to fund purses for 2011 based upon the share of revenue generated for purses in accordance with the offer. In this manner any reduction in revenue because of this dispute would be shared by both Suffolk and the NEHBPA…. It certainly appears the economy is recovering so that we can reasonably anticipate business to be at least as good as the prior year. In any event if the revenue is shared as we propose (and as virtually every other venue shares it), and the risk of decreased revenue is likewise shared equitably.
Frisoli describes the offer, partly based on an increase in simulcasting revenue this winter (before signals were blocked), as “very generous.” I would say it’s very interesting, and reminiscent of aspects of Fred Pope’s recently published scheme for paying purses, in that horsemen would have a vested interest in increasing revenues for the purse account. The proposal relies, though, on a 50-50 simulcasting split, about which the NEHBPA is adamant.
Suffolk, which has not yet commented on the horsemen’s proposal, seems just as determined to split toward the lower end of the range allowed by state law (4-7.5% of gross simulcast handle, which equals 25-50% of available revenue). According to numbers provided by the NEHBPA and drawn from track financial documents, Suffolk has paid less each year since 2008, when the simulcasting split was 40.92% to purses, 59.08% to the track. In 2010, 34.49% went to purses, 65.51% to the track. “We have simply asked Suffolk to share the net profit from simulcasting in the same manner as it is shared in virtually every other racing jurisdiction in the United States,” said Frisoli.
Track management has previously pointed to the loss of more than $40 million over the past four years and declining revenues as evidence that a more equitable split isn’t feasible without expanded gaming in Massachusetts.
“The issues are quite simple. Suffolk Downs controls its expenses,” said Frisoli, citing the track’s investment in the Wonderland dog track and expenses related to work on gaming legislation, passage of which would benefit the horsemen as well as the track. “We are not quarreling with Suffolk’s right to choose how to spend its money. But we are contesting its claim that it was ‘forced’ by declining revenue or other economic factors to act as it did.”
The horsemen’s desire for an even split is understandable, I said to Frisoli, but considering the declines since 2007 in total handle (down more than a third) and revenue, the NEHBPA seems to be seeking more of less. “The NEHBPA continues to seek only an equitable share of whatever revenue exists,” he replied, “and will work with Suffolk Downs to increase revenue.”
The Laurel simulcasting signal to Suffolk was cut beginning today, bringing to six the number of blocked tracks. “It is a long-standing practice of the MTHA and its predecessor organization, since the enactment of the Interstate Horse Racing Act, to withdraw the simulcasting signal of Maryland races if there is a contract dispute between a racetrack and its horsemen’s organization,” said Maryland Thoroughbred Horsemen’s Association counsel Alan Foreman. “We don’t take sides. We don’t profess to know the details. It is automatic.” So, nothing personal, Massachusetts bettors! (Thanks to Thoroughbred Times correspondent John Scheinman in Maryland for the assist.)
Racing at Brockton if not at Suffolk? George Carney appears on the scene.
New Proposal, Laurel Cut
The New England HBPA’s response to Suffolk Downs’ proposed terms for the 2011 meet was presented to the track this morning and posted to the group’s website this afternoon. You can read the whole thing — it’s a two-page letter (PDF) — the gist of which is that the horsemen will race for the number of days required by state law for an equal split of the simulcasting revenue, “without the guarantee made in previous agreements as to the total amount of purses to be paid during the course of the meet.” No purse guarantees is the concession* — the rest of the proposal is what both sides stumbled over earlier in negotiations, leading to the breakdown in talks. Suffolk confirmed that it received the new proposal, but declined commenting until management reviewed it. My sense is that a breakthrough isn’t in the offing.
Suffolk’s simulcasting menu shrinks again on Friday. The Laurel Park signal will be blocked beginning tomorrow. The action, being taken by the Maryland Thoroughbred Horsemen’s Association in solidarity with the NEHBPA (joining the Florida, Ohio, and Oregon horsemens’ groups), brings the number of blocked tracks to six and could be taken as another sign that the impasse isn’t about to end soon. Here’s one Massachusetts bettor mad about the mess.
10:35 PM Addendum: Funny, I didn’t expect confirmation that the situation wasn’t on an upswing to come so swiftly. “[T]he racetrack threatened legal action against the horsemen and demanded they remove their office trailers from the grounds,” reports Lynne Snierson. At issue, apparently, is the NEHBPA’s fact-sheet posted yesterday (and which I delved into a bit below).
*2/11/10 Addendum: Additional info on what the NEHBPA projects for purses:
The proposal requires racing for the minimum number of days required by statute which is presently 100 days of racing. Daily purse distribution would be determined based upon available revenue. Assuming revenue consistent with 2010, the NEHBPA projects a daily purse distribution of about $95,000 per day would result from implementation of its proposal, with the prospect that the daily purse distribution could increase to $100,000 per day based on increases in simulcasting revenue consistent with increases experienced for the month of January 2011.
Assuming that 2011 revenues will remain consistent with 2010 seems risky, considering the downward trend in handle across the industry, as well as at Suffolk Downs, which is down more than a third since 2007.
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Jessica Chapel writes and edits in Massachusetts. Railbird is a Thoroughbred horse racing blog published from June 2004 to July 2019. More / Contact
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