REDUCE THE ALPHABET SOUP - Horse Racing News | Paulick Report


By Ray Paulick

What does the departure of Churchill Downs Inc.'s four racetracks—Churchill Downs, Arlington Park, Fair Grounds, and Calder—from membership in the National Thoroughbred Racing Association mean for that organization's future?

From a budget standpoint, not much, according to published reports. The $375,000 in dues from the CDI tracks represents just 3.75% of the NTRA's $10-million annual budget. However, it was enough to cover the base salary of the NTRA's CEO, Alex Waldrop, reported at $302,706 earlier this year when the Paulick Report published a list of salaries paid to executives of some of the horse industry's non-profit associations.

So the loss of $375,000 means the NTRA will be doing less in the next 12 months than it did in the last 12 months, because I doubt very much Waldrop will be taking a cut in pay.

That begs the question, and it's one I hear from people all the time: What does the NTRA do?

Let me start by saying what the NTRA does not do.

The NTRA does not promote or market racing as it once did. It no longer buys televise time to showcase the sport. It is not a “league office” in any way, shape or form that the NBA, NFL or MLB professional leagues have a national office. It has no authority over anyone or anything.

It does, however, have some useful functions, though Bob Evans, the bottom line boss of Churchill Downs, does not see them as valuable enough for the money the company was paying the NTRA in dues.

The NTRA and its Political Action Committee do represent the horse racing and breeding industry in Washington, D.C., and in my opinion has done a good job lobbying Congress and other federal officials, often working alongside the American Horse Council, which represents all breeds of horses. Both organizations have been effective on tax matters of interest to owners and breeders, though it would be nice if they could give horseplayers better representation when it comes to changing the law regarding winning bets that require signatures and tax withholding.

NTRA also has a small but hard-working press office that, among other things, spent a great deal of time organizing teleconferences with owners, trainers, and jockeys of horses participating on the road to the Kentucky Derby. Those weekly teleconferences generated needed publicity for a sport that struggles to get coverage in the mainstream media.

The NTRA also has teamed with Daily Racing Form to promote national handicapping tournaments, and has ongoing dialogue with horseplayers.

The NTRA has put a great deal of time and effort into the Safety and Integrity Alliance that was created following a series of events, including the death of Eight Belles in the 2008 Kentucky Derby and a Congressional hearing on horse racing matters in June of that year.

The Safety and Integrity Alliance, which includes accreditation—or something akin to a “good horsekeeping seal of approval”–for tracks that meet certain standards related to horse welfare, has been a superficial approach to a serious public relations problem. But because the NTRA has no authority over anyone or anything, I'm not sure how the alliance could have made a substantive impact on those problems. More than anything else, the Safety and Integrity Alliance can be viewed as the industry's response to further inquiries from the federal government. If Waldrop is called before Congress again, however, I doubt the Safety and Integrity Alliance will be applauded as something that's made a significant difference.

Accreditation or lack thereof by the alliance certainly has had no impact on a racetrack's business. Three tracks that have either not applied for or received accreditation, Tampa Bay Downs, Oaklawn Park, and Hawthorne—are coming off very successful race meetings in comparison to the previous year. One of the goals of the alliance, Waldrop had said, was to build confidence among horseplayers for tracks that have received accreditation. Horseplayers don't care about that.

So do we really need the NTRA? Churchill Downs apparently doesn't think so. Neither does Oaklawn Park, Delaware Park, the Penn National Gaming tracks or Philadelphia Park. Will the tracks now owned by MI Developments be next to drop out?

Over the last decade there has been a great deal of consolidation in the industry, with publicly traded companies Churchill Downs, Penn National Gaming, and Magna Entertainment (now part of MI Developments) building their portfolio of racing and gaming properties.

There hasn't been consolidation when it comes to racing organizations, also known as the alphabet soups. There are more of them today than we've ever had before, and with each organization comes the cost of salaries, offices, travel and other expenses.

For the same economies of scale reasons the tracks have consolidated, we need consolidation of these alphabet soups, many of which seem to be increasingly focused on self-survival rather than on industry service. When the NTRA was created, there was a hope that much of the industry would consolidate and work together under a single umbrella. That clearly hasn't happened. It's every man (and organization) for himself.

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