Point by Point
While waiting to learn more about the New England horsemen’s counter-proposal to Suffolk Downs, and the track’s response, it seems worthwhile to dig into a couple points under discussion. Where last left off, negotiations had come to a standstill over the number of race dates, the total purses to be paid, and the simulcasting revenue split. Suffolk, awarded the state-mandated minimum of 100 days in 2011 by the Massachusetts Racing Commission, proposed racing 67-76 days for average daily purses of more than $100,000 — the level sought by the NEHBPA — instead of the $75,000 initially offered. The NEHBPA rejected racing fewer than 100 days, which would require legislative approval, citing the importance of maintaining the Massachusetts breeding industry, and holds that the higher purse level, which would total approximately $10.6 million instead of the $7.5 million Suffolk projects, could be funded by a more equitable split of simulcast monies.
What is not in contention at this time is the purse formula posted by Suffolk Downs on its website (PDF), or revenues after financial documents previously requested from the track were provided to the NEHBPA on Tuesday.
Responding to a dispute fact-sheet published by Suffolk last week, the NEHBPA posted a “Truth About Suffolk Downs Fact Sheet” (PDF) on Wednesday. We’ll pass over item one, which questions track management’s commitment to live racing. It’s been my opinion since Richard Fields bought into the place in 2007 that management has consistently demonstrated good will and concern for the track and its community, history, and future. Fields and company have never hidden that their goal is for expanded gaming — preferably a casino — to come to Suffolk, but their support for racing appears genuine.
The NEHBPA takes issue with Suffolk’s claim that it raised purses in 2007 and 2008 in item two, writing that 2008 purses were $200,000 less than in 2007, and 2009 purses were $2.3 million less than 2007. That’s a decline of 19% for the period, which the group ascribes to Suffolk paying less on the simulcasting split. What this ignores, though, is that race dates also declined in 2008 and 2009, and much more importantly, that handle declined. In 2009, simulcasting handle was down 26.2% and live handle down 27.6% over 2007. Comparing 2010 to 2007, purses were down 23.6%, simulcasting handle down 35.6%, and live handle down 36.2% (all figures based on data supplied by Suffolk). In other words, purses have declined less than total handle since 2007.
Item three has to do with the “overpayment” of purses by Suffolk, which the track calls voluntary and the NEHBPA contractual, writing that “the NEHBPA knew that the requirement to pay purses at the levels set forth in the contract would result in Suffolk paying more in purses than the revenue accumulated from the various sources as set forth in the contract.” I could be reading this wrong, but it sounds as though the NEHBPA knowingly extracted more money for purses than revenues could support, and that the group wants a new contract with the same deal. No wonder Suffolk balks.
[2/11/10 Edit: NEHBPA lawyer Frank Frisoli clarifies the above:
As discussed in greater detail in postings on the NEHBPA website, we have always considered the “overpayment” of earned purses as an additional share of the simulcasting revenue and a consequence of the terms of the contract. The contracts signed in the past required Suffolk to pay towards purses simulcasting revenue in accordance with state law. State law requires the parties to negotiate between a minimum and maximum percentage. So the contracts signed required Suffolk to pay an amount between 4% and 7.5% of the gross simulcast handle to purses which translates approximately to a minimum of 25% of the net commissions to a maximum of 50% of the net commissions.
I stand corrected re: more for purses than revenues could support.]
Coming back to the track’s commitment to racing, item four spells out the horsemen’s fears regarding expanded gaming:
If Suffolk Downs is granted a casino license, the profits that could be realized from developing for gaming use the portion of the Suffolk property presently used for racing will significantly exceed any profits that could be realized from continuing live thoroughbred racing. So the future of thoroughbred racing at Suffolk Downs appears to be clearly conditioned upon legislated conditions being attached to the gaming bill requiring Suffolk to continue thoroughbred racing.
Well, yes, and that’s what makes the slots trade such a treacherous one, as Bill Finley recently wrote. But the New England horsemen are not helping themselves by attempting to buck the trends driving the industry these days, such as shorter meets. The NEHBPA actually attempts to make an argument for a longer meet in item five, seeking to increase the number of race dates to a minimum of 125 days annually in order to support the Massachusetts breeding program. Ray Paulick responded to this seeming flight from reality:
So according to the legislature, the NEHBPA, and the Massachusetts Breeders Association, the state needs four racing days for every live foal it produced three years ago. Using that formula, Kentucky would require more than 30,000 racing dates a year.
There’s just no market for 125 days of Massachusetts racing (or 100 days), not at the level the game currently exists in the state. The handle bears that out.
Because I’m determined to keep this post to a reasonable length, we’ll skip over the rest of the document, which largely reiterates points already made. The exception is a late charge, in item 10, that Suffolk is negotiating with the intention of not holding a meet. “The negotiating posture of Suffolk Downs clearly evidences its intent not to conduct live racing in 2011,” reads the fact-sheet. Track management has said elsewhere, and repeatedly, that a live meet is planned, whether an agreement is made with the NEHBPA or another horsemen’s group, and I see little reason to doubt the sincerity of their statements, although I do agree with the NEHBPA that average daily purses of $75,000 for 100 days are “insufficient.” The solution, though, is fewer days.
Negotiations to Resume?
After days of stalemated negotiations, the New England HBPA plans to present Suffolk Downs with a counter-proposal to the track’s January 26 offer. It’s a bid to end an impasse that has led to the blocking of simulcast signals from Florida, New York, Ohio, and Oregon, and threatened the running of a 2011 meet. During a closed meeting on Tuesday, after financial information the NEHBPA had been seeking from Suffolk was provided, the board “authorized submission of the new offer which will be issued to Suffolk Downs no later than tomorrow,” said NEHBPA lawyer Frank Frisoli this morning.
Frisoli declined to discuss the details of the proposal or whether resuming negotiations would result in the blocked signals being made available once more to Massachusetts bettors. “I will not address the terms of the offer until after it has been made,” he said, noting that the horsemen’s group only has control of the New York signal. “The NEHBPA had no involvement whatsoever relative to the Tampa Bay signal,” said Frisoli, “and it is entirely inappropriate to demand action beyond our control as a condition to further negotiations.”
Related: There’s been some confusion about whether Massachusetts statutes only allow ADWs to take wagers from state residents on tracks that simulcast through Suffolk Downs. TVG has closed off betting on the blocked signals to customers, but TwinSpires has not. “We will continue to offer wagering on these tracks to Massachusetts residents because the dispute does not involve us or our contracts,” said a company representative. Sounds like a reason to sign up, if you don’t already have an account!
2/10/11 Addendum: More on the counter-proposal from Lynne Snierson, as well as notice that Suffolk plans to reduce hours and staff due to lost revenue.
The Impasse, Cont.
As the dispute over terms for a 2011 Suffolk Downs meet continued, the union representing the racetrack’s workers warned of possible job losses and the number of bettable tracks available to Massachusetts horseplayers declined by one when the Oregon horsemen blocked the Portland Meadows signal in support of the New England horsemen on Monday. That’s in addition to the loss of New York last month and the Ohio and Florida signals last week.
Unless bettors travel to the simulcasting halls at Plainridge or Raynham, which are not affected by the dispute and retain signal rights, leave the state, or open an offshore account or ADW account with an out-of-state address — options discussed by horseplayers on forums and Facebook — they won’t be able to play Aqueduct, Gulfstream, or Tampa races on track or by ADW beginning today, a shut-out Suffolk called “a slap in the face” to fans.
I asked NEHBPA lawyer Frank Frisoli on Tuesday morning what the horsemen would like horseplayers to know about why the signals have been blocked. He replied that he was unable to provide a response at that time, but would have one by mid- to late-afternoon. No further reply was forthcoming*.
How long before the dispute is resolved and what resolution might look like is uncertain. Suffolk Downs COO Chip Tuttle told Matt Hegarty that there was no progress in negotiations as of Tuesday afternoon. “We’re still waiting on a counterproposal to the proposal we offered on Jan. 26.” The NEHBPA board met in a closed meeting last night.
Suffolk management considers itself “free to discuss parameters of the 2011 season with any individual owners, trainers or organizations” (PDF), and a new organization representing Massachusetts horsemen, the Thoroughbred Horsemen of Massachusetts Association, is reportedly being formed, although those who may be involved in it are reluctant to speak publicly about the group or its positions on purses, days, and revenue splits. The Facebook page for the group that has been viewable on-and-off since late last week is on again, but has no followers or messages other than the original posting, reported here on Sunday. “If this association were to become a reality,” said a horse owner who approved of the group’s apparent stance, “I would pledge my support to them to keep racing at Suffolk Downs a reality.”
The most visible support for a new group came from horsewoman Laurine Barreira on Monday when she wrote on the Suffolk Downs Facebook page, “I am more than glad that people are working on making a mass hbpa! we as horseman need someone representing us that actually cares about the future of racing in massachusetts!” Barreira is the granddaughter of horseman and breeder Lloyd Lockhart, the third generation of her family involved in Massachusetts racing, and a co-owner of Ask Queenie, the exceptional Mass-bred retired last fall with 27 wins and $780,365 in earnings.
The effects of the impasse are being felt among the Suffolk community, scattered to other tracks for the winter, reports Lynne Snierson:
“I can’t believe what a nightmare this is,†said one trainer currently stabled in Florida who requested anonymity. “We need a contract in place and it’s already late in the game if we’re going to be able to ship in and start racing again at the beginning of May. We need to submit stall applications and firm up plans. It won’t be easy to get stalls at other places because all of the other tracks on the East Coast offer higher purses and space there is at a premium. Even if we could get in, we don’t have the horses to compete.”
Or, as a horseman succinctly said to me when I asked for impressions of the situation, “If they can’t get it together, we’re fucked.”
*11:45 AM Update: Frisoli replied this morning, stating that “action to deny permission for transmission of the NYRA signal was taken as authorized by state law only after all other alternatives were exhausted” (the NEHBPA does not have control over the other blocked signals), and provided a fact-sheet produced by the NEHBPA in response to one posted by Suffolk Downs earlier (PDF), which includes additional details about the purse structure in dispute.
The Gaming Trade
Bill Finley on the approaching end of slots-supported racing:
… now things are starting to change. Where will the sport be when the slots money starts to go away? Whatever the answer is, it’s not a good one.
NYRA president Charlie Hayward speaking in support of full-fledged casinos:
“The racing industry will get 16 percent of the racino’s net earnings,†Hayward said. “We can take a little bit of pain in terms of reduced handle.”
In Hayward’s favor, NYRA numbers are strong post-NYC OTB.
“A Slap in the Face”
The Thoroughbred Times reports on weekend developments in the Suffolk Downs-New England horsemen’s dispute, making mention of an open letter placed by the track in the Sunday edition of the Daily Racing Form:
The tone of the letter reflects the bitterness of the dispute, calling the horseman’s decision to block simulcast signals “a spiteful, punitive action toward Suffolk Downs, NYRA and its horsemen, and a slap in the face to the bettors of Massachusetts whose wagering dollars supply the purses.â€
It’s a smart move by Suffolk, stepping up as defender of bettors. Much like the TOC with the takeout increase in California, the NEHBPA board has made a crucial mistake in pursuing its agenda by taking Massachusetts horseplayers for granted. When the full impact of the blocked signals from New York and Florida are felt on Wednesday, bettors won’t be interested in parsing the dispute’s fine points — blame will fall where it lands easiest. And to the extent that this story has any legs beyond Massachusetts among racing fans, it’s that yet again, it’s the horseplayers who pay when horsemen and tracks fight.
When Bukowski was horse racing’s customer, the perpetual maltreatment of horseplayers didn’t have much power as a meta-narrative. In an era in which most of the game’s customers are online (and increasingly organized), it does.
2:30 PM Addendum: Another take, from a commenter on the Suffolk Downs Facebook page: “If Suffolk really thinks fans will blame the HBPA on this, that’s crazy. They own the signal(s) and it’s really the only card they have to play.” True, that the signals are the most significant leverage the horsemen have, but the NEHBPA hasn’t sold the story of why such drastic action — and the resulting losses, along with the inconvenience to bettors — is necessary.
2/8/11 Addendum: The full text of the letter published in DRF (PDF).
Digging In
New England HBPA lawyer Frank Frisoli told Paul Daley on Thursday that other horsemen’s groups might pull simulcasting signals from Suffolk Downs “out of solidarity” with the Massachusetts group, which is negotiating with the track over 2011 race dates, purses, and the simulcasting revenue split. Lynne Snierson reports that the Ohio and Florida horsemen have now done so:
On Jan. 29, the New England horsemen withdrew their consent for races from the New York Racing Association to be simulcast in Massachusetts and now races from Beulah Park are no longer available. As of tomorrow (Sunday, Feb. 6), races from Tampa Bay Downs will not be available and Gulfstream Park must stop sending its signal on Monday. Under Massachusetts statute, Advance Deposit Wagering account holders in the state are also prohibited from betting those tracks through TVG, Twin Spires, XpressBet …
Unbelievable. Unsurprisingly, there’s not a word in Snierson’s piece from the NEHBPA acknowledging, much less apologizing for, the affect blocking the feeds has on Massachusetts horseplayers. I would complain about how bettors — the people who fund much of the purse account at the center of this fight — are the only ones getting hurt at this point, but Suffolk kicked the backstretch assistance center, the Eighth Pole, off its grounds, and not being able to play the Whirlaway at Aqueduct this afternoon really pales in comparison to being shuttled to a homeless shelter for medical treatment and social services.
So, the situation is ugly, and complicated, and seems likely to become more so before anything is settled. I heard a few days ago that there were horsemen unhappy with the NEHBPA’s handling of the negotiations, none willing to talk even anonymously, which Snierson confirms, and a group calling itself the Thoroughbred Horsemen of Massachusetts Association appeared on Facebook at this URL before disappearing early Saturday. [2/6/11, 4:00 PM Update: The group’s page has returned. “We are a newly formed organization reaching out to the horsemen of Massachusetts who race regularly at Suffolk Downs,” reads its description. “If you feel that the New England HBPA is misrepresenting Massachusetts horsemen in their quest to sign a purse agreement for the Suffolk Downs 2011 race meet, then we want to hear from you!”]
Meanwhile, the track is apparently planning for a meet beginning in May. “I hope there is room for an agreement [with the NEHBPA],” Suffolk COO Chip Tuttle told Snierson. “But if not, we intend to run a race meet in 2011 regardless.” This makes about as much sense as the NEHBPA’s earlier claims of seeking an alternate venue for live racing. There’s nowhere else to race in Massachusetts, and there’s no one else who wants to race in Massachusetts.
(And if there is? Are these horsemen wanted at Suffolk? There have been years, not recent, in which stalls have been given to unsavory trainers banned from other jurisdictions for the purpose of bolstering the local horse population. Even at the higher purse structure under discussion, the average daily purses will still be lower than any other track on the East Coast. Rogues will apply.)
But I also hope agreement is possible. This just isn’t the way for racing at the last thoroughbred racetrack in New England to end. Suffolk posted on its website this morning a dispute fact sheet (PDF), and a copy of the track’s response letter to the NEHBPA when negotiations initially broke down last month (PDF). A few things jumped out on reading, not least:
The letter also omits other elements of the proposal that further demonstrate SRR’s good faith negotiations. These include a willingness to spread the racing days over a 23- to 26-week meet and to keep the barn area open from late April until at least early November, which you have conveyed is important to your members but creates considerable extra expense for SSR. The SSR proposal also would have committed SSR to adding racing days to the season in the event that the handle generated at Suffolk Downs approaches the level it was at last year.
Suffolk is proposing a shortened meet, and is offering to spread out race dates and keep the barn area open for almost seven months. That doesn’t just sound like good faith, it sounds like a perfectly viable solution, considering the current state of the racing industry and the never-ending, ever-surprising expanded gaming maneuvering on Beacon Hill. The NEHBPA wants the state-mandated minimum 100 days and total purses of $10.6 million, but there’s just no market for that much Massachusetts racing, and there’s no money to support that much Massachusetts racing without slots.
“Even running for a little bit of money is better than no racing and no money,” horseman Charlie Assimakopolous told Snierson. That’s the bottom line.
Stalemate Update
Paul Daley reports on the Suffolk Downs-New England horsemen dispute:
It is Frisoli and the NEHBPA’s contention that shortly, if a contract cannot be ironed out, other HBPA’s around the country — such as Gulfstream Park — will block their signals from being sent to Suffolk out of solidarity to the New England horsemen’s plight. Stay tuned for that one.
Pity the horseplayers, caught between.
Noted and Noticed
Penn National chairman Peter Carlino and CHRB vice chairman David Israel don’t agree on the value of supplementing purses, but they do on racing’s demographic. “There aren’t sufficient numbers of racing customers in the world anymore because they died,” Carlino said today in an investors and analysts conference call. “The average age of our ontrack customer is deceased, and the average age of our satellite customer is decomposed,” Israel told attendees of the UA-RTIP symposium last December. At least Israel went on to talk about reaching out to potential un-dead fans.
HANA president Jeff Platt, a racing customer very much alive, talks to Jack Shinar about the month-long players’ boycott of California. “Right now I believe there are a number of people in track management that are considering going to the CHRB to ask that it rescind the takeout increase,” said Platt, who took part in recent meetings with track executives. “The TOC is being very tight-lipped about this. This was a horsemen’s idea, after all, not a track idea.” No comment on the boycott from the TOC to Shinar. (Are they just considering, or have they already had discussions about rescinding the takeout increase? That’s an interesting question, considering the depressed handle and what must be growing concern re: the purse account.)
The equine California makes his debut in race eight at Gulfstream on Saturday in the first race at Gulfstream on Sunday. Trainer Todd Pletcher scratched the Madcap Escapade colt from a race that included barnmate Cal Nation, a half-brother to graded stakes winner Bluegrass Cat, and re-entered him in a race that came up a little less contentious. John Velazquez is named to ride on Sunday, instead of Ramon Dominguez, who had the mount in Saturday’s race.
2/7/11 Addendum: California finished third in his first start.
The Other Side
Yesterday’s post may have been intemperate. Via Twitter, I heard from a New England horseman that the dispute with Suffolk Downs is one of fairness. “[W]e … just want what every other racing jurisdiction gets, a 50/50 split on simo revenues, not 75/25 split for suf.” For another, who prefers anonymity, it’s about protecting the state-mandated days the horsemen have now and the Massachusetts breeding program, which registered two foals in 2010. “If the Downs runs less days this year, it won’t run more next year,” he said. “We’ll never see those days again.” Underlying the fight over purses and dates is also the memory of purse reductions last August following the failure of expanded gaming legislation, cuts that left many on the backstretch feeling demoralized.
That the horsemen have legitimate concerns isn’t in question. They’re fighting for their livelihoods, and they’re in a desperate spot. And, of course, there’s the possibility of slots. Everyone wants to hang on, in case …
And yet, Lynne Snierson’s Blood-Horse report on Suffolk’s “militant” horsemen was a stunning read. The NEHBPA’s stance belies broader trends in racing; there are reasons contraction is a hot topic across the industry. The tactic was tried at Rockingham; there is no thoroughbred racing at Rockingham anymore. Suffolk, legislatively freed to run shorter meets, may not run 100-plus day meets again, but horses won’t race at all in East Boston if the track is closed, and very few outside Massachusetts would notice. “If [horsemen] continue to thumb their noses at Suffolk Downs in hopes for a currently non-existent alterative venue in Massachusetts in which to conduct thoroughbred racing,” writes Foolish Pleasure, “do they seriously believe anyone outside of their little circle will care when the lights go out for good there?” A Paulick Report commenter certainly doesn’t: “Good luck running those horses anywhere else.”
Wild Talk in NE
Frustrated by a breakdown in negotiations with Suffolk Downs over 2011 purses and race dates, the lawyer representing the New England horsemen’s group is considering alternate venues for live racing, reports the Blood-Horse:
“If Suffolk Downs doesn’t want to work with us, we’ll find someone else that does. There is no reason we have to have live racing at Suffolk Downs.â€
The New England horsemen are good people, but this is mad, as is their lawyer Frank Frisoli’s assertion that, “Suffolk [management] can recognize that we’re a partnership, or they can continue to stick their head in the sand.”
It’s not management that’s playing ostrich. Over the past four years, Suffolk has restored parts of the cut stakes schedule, fixed up bits of the grandstand and backstretch, celebrated a 75th anniversary — and lost $40 million keeping racing going. That’s not because Suffolk management is filled with altruists — if expanded gaming ever comes to Massachusetts, the track expects returns on that money many times over — but it has gallantly sustained the unsustainable. The message being sent this winter, and which the horsemen can’t seem to hear for the sand in their ears, is blunt — no more.
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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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