Date Posted: 8/31/2010 6:24:21 PM Last Updated: 9/1/2010 11:43:47 AM

An effort to finalize proposed regulations on out-of-competition testing of horses in Kentucky erupted into a lively debate over penalties when two panels met in joint session via teleconference Aug. 31.

The out-of-competition regulations have been drafted, revised, and debated over the course of several meetings and in public meetings conducted by a joint committee of the Kentucky Horse Racing Commission and the Equine Drug Research Council. The Aug. 31 session, in which members of the two bodies participated via teleconference from locations in Louisville, Ky., and Lexington, were designed to finish a proposal to be submitted to the full KHRC at its Sept. 7 meeting.

Four states and Canada currently have out-of-competition testing, which allows the commission to conduct tests on horses regardless of location if there is a likelihood the horse ordered for testing will race in Kentucky. The tests are aimed at detecting prohibited substances, mainly blood-doping agents, that cannot be detected in post-race tests.

During an Aug. 26 meeting, the three-member rules committee and eight-member EDRC settled on a penalty of license revocation of one to 10 years and a fine up to $50,000 for an owner, trainer, or their designated representative when a horse tests positive under the regulations. The same penalties would apply for refusal or inability to have the horse available for testing after being notified, under a set of parameters outlined in the regulation.

But as the rules committee and EDRC, which was empowered by the state legislature to recommend drug policy to the KHRC, went through the final changes in the document Aug. 31, it quickly became clear that some of those involved in the decision-making process were not happy with the earlier penalty recommendation.

Tom Conway, an attorney, horse owner, and rules committee member, recommended that the penalty be amended to between five to 10 years. He and Ned Bonnie, also an attorney and horse owner who chairs the rules committee, said they believed the one- to 10-year penalty provides too much leeway to the regulators who would be imposing the penalties and would not withstand a legal challenge.

State Sen. Damon Thayer, a member of the EDRC who had not attended previous meetings of the two panels working on the out-of-competition testing regulations, strongly suggested that Kentucky adopt the mandatory 10-year license revocation adopted by most of the other jurisdictions that have similar testing.

"I believe we need to have a 10-year penalty so we can have uniformity" with other states’ out-of-competition testing, Thayer said, noting that a stiff penalty would be more palatable to the Breeders’ Cup World Championships. The Breeders’ Cup, which will be held at Churchill Downs Nov. 5-6, has been cited as a reason for Kentucky adopting out-of-competition testing regulations.

Dr. Mary Scollay-Ward, the KHRC equine medical director, pointed out that California’s out-of-competition testing regulation provides only for the same penalty—license revocation of one to three years—applied when a horse is positive for a Class 1 drug in post-race tests.

Bonnie said a 10-year suspension or license revocation would essentially be a life sentence for anyone found in violation of the regulations. He said the five- to 10-year penalty would provide the opportunity for a violator to serve the time and then reapply to the commission for re-licensing. He said that if the commission believed additional time was needed before the individual could resume their participation in racing they would reject the license request.

Alan Leavitt, a KHRC member who attended the Aug. 31 meeting, echoed support for a 10-year penalty. "This is the worst offense you can commit in horse racing," Leavitt said of blood-doping, noting that it has been more of a problem in Standardbred racing than Thoroughbred racing.

A vote on Conway’s motion to recommend the five- to 10-year penalty was 6-4, with the two rules committee members permitted to vote favoring the motion and the EDRC deadlocked at 4-4. (Rules committee member Burr Travis participated in the discussions via telephone but was not permitted to vote because he was not at a location where the teleconference was taking place).

Thayer protested the vote, noting that only the EDRC was empowered by the legislature to recommend drug policy to the commission. In essence, Thayer said, the rules committee votes should not be counted, meaning that the motion failed due to the 4-4 EDRC vote.

Bonnie, however, ruled that the joint vote would be binding.

That set off the lengthy, heated discussion over the manner in which the out-of-competition regulation process had taken place. Conway voiced his displeasure with Thayer’s questioning the joint workings of the rules committee and EDRC after so much work had taken place. Thayer said he had been unable to attend previous meetings due to scheduling conflicts with his legislative duties.

Dr. Jerry Yon, EDRC chair, said he brought the rules committee into the out-of-competition regulation process because so many of the KHRC rules would have to be amended to accommodate the rules.

In the end, the five- to 10-year penalty will be the recommendation considered by the KHRC.

The meeting ended without an official vote on the revised proposed out-of-competition regulation for the commission to consider, an omission that went unnoticed until a reporter pointed it out. At that point, there was no longer a quorum available for a final vote.

Posted: Tuesday, August 31, 2010 7:25 PM

Responding to a 47% drop in betting from each of the account wagering providers that do business in Illinois since regulators imposed a 5% cap on out-of-state wagering fees effective July 12, the Illinois Racing Board on Tuesday voted 7-1 to raise the cap to 9%.

The new cap will take effect Thursday, enabling the account wagering customers to bet on tracks—such as Del Mar Thoroughbred Club and Saratoga Race Course—that charge more than 5% for their signals.

“Whatever is necessary to turn these signals back on, that’s what we want to do,” said Illinois Thoroughbred Horsemen’s Association President Mike Campbell.

Campbell previously had expressed “support for our fellow horsemen in states that have prime content signals …

“They believe their signals have significant value and are not willing to undermine that value by selling to a state that imposes a cap that is less than fair market value,” he said.

Arlington Park President Roy Arnold joined Campbell in urging the board to adopt the 9% cap.

“We want the ability to honor contracts freely entered into before July 12,” Arnold testified. “The problem right now is we have content we want to get and we cannot get it. The 9% cap will allow us to secure the premium content that our customers want. We have serious legal issues with interfering with pre-entered contracts.”

Also lending their support were those that had originally supported the 5% cap: Hawthorne Race Course, Fairmount Park, Balmoral Park, Maywood Park, and the Illinois Harness Horsemen’s Association.

“I understand the reasoning,” said Fairmount President Brian Zander. “I don’t see an issue with 9% but my personal preference would have been to have the envelope a little smaller—higher than 5% and less than 9%.”

“We have a comfort level this will work out,” said Balmoral President John Johnston.

The proponents of the cap had a shared concern that racing conglomerates such as Churchill Downs Inc. and MI Developments Inc. would bundle their tracks and sell the account wagering package at a higher rate. For example, if this were the case, Magna hypothetically could charge the same 9% fee for both Santa Anita Park and Portland Meadows.

“We have no problem paying a higher rate if the signal warrants,” said IHHA executive director Anthony Somone, citing Del Mar, “but not for a ‘B’ track.”

The new rule mandates that each track receive individual consideration and creates checks and balances.

“If there’s anti-trust activity going on the board can act on it,” said the board’s general counsel, Shelley Kalita.

The only board member who voted against the 9% cap was Paul Smith, who expressed fears that it would prompt many tracks with non-premium racing to hike their rates.

“We’re not compelling anyone to pay 9% for the signal,” countered board Chairman Joe Sinopoli. “This is not a requirement. If someone wants 8% and you don’t want to pay 8% you don’t have to. If a track is asked to pay above the market rates just say ‘No, we don’t want it.’”

Sinopoli said the Racing Board office was “inundated with calls from account wagering customers complaining” because they were unable to bet on Saratoga or Del Mar.

Bob Dwyer of Naperville, Illinois, a member of Horseplayers Association of North America, testified on behalf of the rule change.

“It was discouraging not to have those tracks available,” he said. “We’ve seen what happens when a regulation is put in that’s not consistent with the market. I have confidence in the business acumen of the people who run the (‘B’) tracks. It’s in their best interest to keep fees low.”

In other action at Tuesday’s meeting, the board approved Hawthorne’s request to reduce the racing week to four days, reduce graded stakes purses, and eliminate an ungraded $100,000 race during its October 1-December 31 meeting.

The Hawthorne Gold Cup (G2) purse was reduced from $500,000 to $250,000, the Hawthorne Derby (G3) from $250,000 to $150,000 and the Robert F. Carey Memorial Handicap (G3) from $150,000 to $100,000. The Indian Maid Handicap was the ungraded race that was removed from the stakes schedule.

Hawthorne Assistant General Manager Jim Miller said the $500,000 in reductions will bring the purse account to a break-even balance.

“Our intent is to begin the meeting with daily overnight purses no lower than $125,000, excluding stakes,” explained Miller. “We’re hoping for an increase the first of November and then another increase the first of December.”

Miller pointed out that impact fee money owed the tracks by riverboat casinos through Illinois House bills 1918 and 4758 is currently tied up in court. He said if the funds are released “we’ll make an immediate request to the board to raise purses.”

Campbell said the ITHA supports the reduction in stakes purses and the elimination of Sunday from the racing week.

“Hawthorne is owed $2-million in recapture [under the statute that legalized full-card simulcasting in Illinois] and $1.6-million in overpayment of purses,” the Campbell said. “We don’t believe Hawthorne should carry us.”

Date Posted: 8/24/2010 11:06:43 AM Last Updated: 8/25/2010 12:07:02 PM
Chris McCarron
Photo: Anne M. Eberhardt

The first North American school for jockeys established by Hall of Fame rider Chris McCarron is embarking on an expansion plan that could include a national and international presence.

However, McCarron, who has been director of the North American Racing Academy since it was established near Lexington in 2006, has opted not to direct and administer the expanded program but instead will continue to focus on instruction of future jockeys.

Dr. Jay Box, chancellor for the Kentucky Community and Technical College System under which NARA operates, said Aug. 23 administrators at the state agency and others involved with advising the jockey school determined it could be expanded. Box said the ultimate goal is to make NARA one of the KCTCS’ "centers of excellence, which are programs that can reach beyond the local college and state and look at national and international interests. Usually, centers of excellence are very broad in nature. We are committed to taking (NARA) to the next level."

McCarron, who rode more than 7,000 winners during his career, has been involved with NARA since its outset. He has been inextricably tied to both the ability to attract students and raise money for NARA. In addition to learning the finer points of riding, students are instructed in other areas of equine health, horsemanship, and business.

The school's first class graduated in 2008, and through racing of Aug. 22, NARA graduates have won more than 460 races, and their mounts have purse earnings in excess of $6.5 million, McCarron said.

In addition to exploring expansion of the current riding school to Louisville, Ky., where Churchill Downs is located, and the Northern Kentucky area that includes Turfway Park, NARA is pursuing venturing into other areas of the equine industry, Box said. He said the Clemens Group is serving as consultant to KCTCS to help coordinate the expanded program offerings, and that at the end of the study will begin a search for a full-time system director.

Box and McCarron both said the retired jockey initially agreed to serve as system director, but has since decided to have a role with NARA that focuses more on instruction than administration.

"I was flattered by, and accepted, their offer to elevate my position," McCarron said, "not knowing the full scope of what I was getting into, and that not being involved with teaching was going to take up the lion’s share of my time. I thought I would be able to do both. I accepted the position, only to think about it over the past few weeks and to consider to let me go back to teaching, which is what they have done."

"He will be the lead instructor for the Jockey Pathway Program, and we’re all excited about that," Box said. "That is where his passion is and his interests lie. In the past, he was director of NARA and had more responsibilities with day-to-day operations. In this position, he has staff status and will have primarily teaching responsibilities and also promote (NARA).

"This is just removing the other responsibilities that were outlined in the system director position."

According to a state of Kentucky database, McCarron’s annual salary is $103,000.