Track Mess: Colonial, Calder and Gulfstream illustrate idustry issues

A Happy Fourth of July weekend to everyone - I hope everyone enjoyed a safe and a sane celebration on Friday. The holiday weekend offers a great assortment of racing action across the country, highlighted on Saturday by the Belmont Derby, Belmont Oaks and Suburban in New York, the inaugural Los Alomitos Derby out in SoCal, followed by Sunday's United Nations at Monmouth and the Queen's Plate at Woodbine.

A couple of new items caught my attention the last few weeks, both of which sadly illustrate problematic issues within the horse racing industry at this time. The first is the situation in Virginia at Colonial Downs. The second is the Calder-Gulfstream Standoff.

Let's start with Colonial Downs in Virginia with a situation that started to get out of control last winter: they won't race a single day at the track in 2014. Why? Because the track and horsemen's groups couldn't agree on dates and purse structures for this year. In essence, Colonial wanted to run a shorter meet with higher purses in 2014, the horsemen wanted a longer, more traditional meet. [There are other issues surrounding the impasse, as well, (like simulcast/OTB dollars, but that's a simplistic look.]

The battle between race days and purses is one that doesn't have a great solution, and the benefits for each side are pretty clear. A shorter meet with bigger purses per race is likely to ensure larger fields and a bigger wagering handle per race - the tracks like that, plus they aren't running as many days so other costs are reduced. But with fewer races (and bigger, more competitive fields) the opportunities to win races is reduced, creating a more difficult environment to make money for owners and trainers in an already tough game. Throw in the all the issues surrounding the OTB/simulcast pot, and we get to the typical stalemate often witnessed within the industry.

I realize each side draws its proverbial "line in the sand" in order for a final agreement to include the terms they feel are essential to their livelihood, but you can't help but shake your head when talks degrade to a point whether each side is willing to completely forgo racing for an entire season.

Watching and betting on horse racing isn't solely controlled by the groups in Virginia; fans and bettors will go elsewhere to get their horse racing fix and the Virginia groups will be left with re-engaging those patrons whenever they decide to settle this dispute.

The overwhelming majority of bets placed on horse racing in this country occur off-track; players can simply open the form to another track if one is dark. Virginia can't get an agreement together in order to run races and takes bets? There are plenty of races in New York, California, Florida, and Kentucky, among the many others, that will be glad to take that betting action.

No sport can afford to simply turn off the lights and expect 100% of the fans to come back when they decide to open the doors. Not baseball, not the NBA, and not the NHL - all of which saw work stoppages and labor disputes cause damage to their fan base. Those entities eventually recovered, although some are still feeling the effects of those days, but the damage was real.

The parties in Virginia will eventually come to a deal, they'll open the track in 2015 (or some date in the future), and then they'll lament the decreased handle and attendance and wonder "what went wrong?"

From Virginia we turn to Florida where the Calder-Gulfstream Standoff finally came to a conclusion, although one that I found a bit odd.

We all know the basic facts on this one: traditionally, Gulfstream ran winter racing in South Florida, while Calder held the summer dates. Gulfstream decided to go to year-round racing in direct conflict with Calder's summer meet and, SHOCKINGLY!, two tracks in the same city running at the same time wasn't such a hot idea in terms of field size. (Who saw that coming?)

So the two track owning heavyweights - CDI/Calder and Stronach/Gulfstream - start negotiating to end the direct competition. At that point I figured Stronach would end up buying Calder off of CDI since Gulfstream was clearly trying to throw its south Florida weight around and I wondered how committed CDI was to the Calder facility; it just seemed like the natural outcome to me. However, the one thing I hadn't factored into my prediction was the Calder Casino, and that ended up being a big part of the final agreement between the two sides.

As reported last week, the final agreement between CDI and The Stronach Group outlined a plan where Gulfstream will run 190 days a year, with Calder running 40 days in the fall. Those 40 days at Calder will operate under Stronach/Gulfstream, not CDI. But CDI still owns the facility. Why? Casino, baby.

Under Floirda law, Calder has to run at least 40 days a year to keep its casino license, so CDI pretty much makes out like bandits in this deal: they can keep their casino (which they only get by running x amount of days a year), but they don't actually have to get their hands dirty by going through the motions of running an actual meet at Calder.

There are plenty of people of the opinion that CDI really wants nothing to do with actually running horse races and simply would prefer to make money off slot machines and casino operations. That accusation was directly right at CDI down in Louisiana this year during a dispute at the Fair Grounds.

It's extremely hard not to look at the deal between Calder and Gulfstream and come to the same conclusion as many of the individuals quoted in the Blood-Horse story on the final agreement:

"This is a new era for Florida racing," said Phil Combest, president of the Florida Horsemen's Benevolent and Protective Association. "The horsemen are looking forward to a much brighter future here in South Florida. Churchill Downs has long made it clear that horse racing is only a means to an end for them. They're a casino company now."

Ouch.

And then this from a trainer:

"Churchill Downs wants to have horse racing just two days a  year–the Kentucky Derby and Kentucky Oaks," said Carlo Vaccarezza, a Gulfstream-based trainer and breeder. "Today, we are free at last from Churchill Downs in racing in Florida. We should be shooting off fireworks in honor of what Mr. Frank Stronach and (Gulfstream president) Tim Ritvo are doing for racing."

I'm not sensing a lot of love.

Following the agreement, some details emerged about what Gulfstream actually had to do to run the Calder meet As it turns out, they have to build a damn grandstand. Yep, you read that right: Gulfstream's lease agreement with CDI doesn't include the current grandstand so they'll have to build a temporary one for the upcoming fall meet.

[Question to CDI: What the hell are you going to do with an empty grandstand? More slot machines?]

Gulfstream and Stronach are not averse to the casino game either, as they are also planing on expanding their gaming operation with a new non-racing building.

So, that's now your south Florida racing situation, one that will probably see a bunch more twists and turns over the next five to ten years. As long as the Calder casino remains linked to a set number of racing dates at the track, I doubt CDI will ever consider selling Calder. With Gulfstream not using the grandstand you wonder how much they'll actually contribute to that fall meet, or whether the 40 days are just a token effort in order to dominate south Florida racing for 10 of 12 months.

And there's the hard truth of this whole deal: NEITHER side really wants Calder around in any way shape or form. CDI won't let go of Calder because they need it to maintain their casino interests. And I don't think it's a great leap of reasoning to conclude that the ideal situation for Gulfstream would be to buy Calder and shut it down; they would rather put all their time and money into just the Gulfstream location.

At least south Florida racing didn't go dark for a year. Right, Virginia?