RACING AGAINST TIME
With funding talks for Ontario horse racing heading into the homestretch smaller tracks wonder how they’ll survive — even if the cash does arrive
When Anthony MacDonald thinks about the little horse-racing tracks dotting small-town Ontario, and the horsemen and women who are trying to carve out a living at them, the future does not look bright.
MacDonald and his wife Amy operate a successful harness-racing syndicate, with more than 70 horses and 300 members from all over the world, but like most in the industry the Guelph, Ont., resident says the rural tracks were his launching pad to success.
He’s thinking about Clinton Raceway near Lake Huron and Grand River Raceway in Elora and 120-year-old Fort Erie Race Track.
“You can’t be a full-time horseman anywhere but the GTA,” he says. “If you’re in Ottawa, Windsor or Sudbury, or anywhere close to those places, you don’t have horses any more.
“How do you convince a 25-year-old to stay in this industry, and where are we going to find the next generation of horsemen?”
The fear is felt on the thoroughbred side as well.
In August, local breeders weathered another dire yearling sale, often a barometer of the industry’s health, where the average price of the young horses up for auction dipped below last year’s mark, which at that time was considered dire.
Despite Kathleen Wynne’s pledge to help right the course for tracks and breeders across the province after her predecessor, Dalton McGuinty, terminated the Slots at Racetracks Program — halting $347 million in annual support for the industry — uncertainty persists for many, including MacDonald. (After the program was cancelled, a group of standardbred breeders filed a lawsuit against the Liberals and the Ontario Lottery and Gaming Corporation.)
In response to industry-wide panic, the provincial government launched a five-year, $500-million transition program to support 15 tracks. In 2016, there was an extra $200 million to help people in the industry until 2021.
In May 2016, Ontario Racing was formed — funded through a transfer payment agreement with the Alcohol and Gaming Commission of Ontario, which now regulates the sport in the province.
Last October, Ontario Racing unveiled its blueprint, including a request for an extension of those payments of $93.4 million a year until 2038. A year later, the request has yet to reach the provincial cabinet’s executive council.
Horse racing is a long game. The earliest that foals conceived next spring can hit the racetrack is 2021— the year the existing provincial commitments end. Breeders and buyers are left to make risky decisions about long-term investments in new stock and farms.
Mike Chopowick, Ontario Racing’s policy director, says the holdup is that the sides are working to “get it right.”
As part of its long-term funding framework, Ontario Racing suggests forming a “racetrack alliance” with Woodbine Entertainment Group — which runs Woodbine Racetrack plus Woodbine at Mohawk Park in Campbellville (formerly Mohawk Racetrack) — in charge of administering it. Woodbine and Mohawk are the largest racetracks in the province, and Woodbine Entertainment already does a good job of overseeing a group of standardbred tracks, Ontario Racing says. Woodbine Entertainment would get $2 million to run the new alliance — which would set race dates, prize purses and business plans.
Shortly after the October 2016 announcement, Ontario Racing led province-wide consultations to present its plan and listen to feedback. Hundreds of stakeholders attended, and there was one overwhelming concern: Ontario Racing must ensure Woodbine Entertainment’s corporate interests don’t overshadow the objective to make every Ontario racetrack viable.
Earlier this year, Fort Erie operators were surprised by news of a limit on starts at their track by horses stabled at Woodbine. For years, Woodbine was the province’s “A” thoroughbred track, while Fort Erie was considered a “B” option. Horses at Woodbine race at a higher level for more money. If they can’t win there, they’d often travel down the QEW to Fort Erie.
Those are the only two thoroughbred tracks left in Ontario, while 12 remain for standardbred and one for quarter horses.
Fort Erie chief operating officer Tom Valiquette said Ontario Racing was “toothless” when he pushed for help in the matter.
“When I complained to Ontario Racing, the answer was: Not much we can do about it. I can see your problem, but there’s not much we can do about it,” he said, adding fields are down by an average of one per race as a result. “That’s had devastating effects on us.”
While Woodbine Entertainment CEO Jim Lawson sits on the board of Ontario Racing, Fort Erie has no seat. This past summer, Ontario Finance Minister Charles Sousa visited Fort Erie and criticized Woodbine’s policy.
In response, Woodbine at Mohawk Park president Jessica Buckley says Woodbine’s limits are standard for the industry and, with a shortage of racehorses across North America, there’s a need to encourage handlers to race their horses there.
According to Ontario Racing funding disclosures, Woodbine’s thoroughbred division — with a 133-day season in 2017 — received $30 million of the $93.4 million last year. Woodbine’s standardbred program got $32 million. Fort Erie — with a 40-day meet — received $7.9 million for purses and operating costs.
In April 2014, as a condition of the $500 million in transition funding, the government formed the Horse Racing Partnership Program, which led to a standardbred alliance including eight tracks. They work together on marketing plus setting race dates and purses.
Earlier this month, Greg Walling, a special adviser on horse racing to Ontario Agriculture Minister Jeff Leal, resigned after one year in the role. In his resignation letter, Walling wrote: “Beware of (Woodbine Entertainment’s) dominant position” as “player, scorekeeper and referee.”
He advocated having Ontario Racing run HPI — the betting and simul- cast platform owned and operated by Woodbine Entertainment — and sharing revenue with all tracks. Leal says he isn’t against it.
“I think that’s a reasonable thing that we should be looking at, for sure,” the agriculture minister said in an interview. “I think that’s going to be part of the long-term arrangement that minister Sousa will be looking at, and I believe that we need to look at all the positive suggestions from the perspective of sustaining 15 racetracks across the province of Ontario.”
Hugh Mitchell, chair of Ontario Racing and CEO of Western Fair District, a standardbred track in London, Ont., disagreed with Walling’s portrayal.
“I don’t advocate that the industry should be concerned about (Woodbine Entertainment’s) role,” says Mitchell, vice-president of racing at Woodbine from 1998 to 2005. “They have had a dominant role in racing for decades. They represent the largest and most significant part of the wagering pie for decades. It’s nothing new, and over the years they have provided extensive leadership to the industry and helped the industry in innovation.” The Woodbine Entertainment Group handles more than 85 per cent of the wagering in Ontario horse racing, and CEO Lawson has been credited with steering the negotiations with the province that resulted in the current subsidy.
The next two months are “critical” for Ontario Racing, Mitchell says, as they work with the provincial government and OLG to hammer out a long-term agreement. Ontario Racing has enlisted lobbyist Patrick Harris of TRM Public Affairs to help its cause.
Meanwhile, MacDonald remains concerned that the cash allotted to small tracks such as Clinton and Grand River, which currently get about $1 million each toward purses, won’t be enough to survive.
“The people I have talked to at Ontario Racing seem optimistic about the future of horse racing and optimistic about the changes that need to be made, but the obvious question is: What about the ‘B’ tracks?’ I do not believe the ‘B’ tracks in Ontario race for sufficient enough money to make a living,” he said.
“How can you possibly recognize and understand that the ‘B’ track
“We’re poised . . . to work away at our ultimate goal of having a more sustainable and viable industry.”
HUGH MITCHELL, ONTARIO RACING CHAIRPERSON
horsemen in this province cannot make a living and assume you’re going to sign a contract for the exact same dates, the exact same money and the exact same structure, and everybody’s going to be enthusiastic about it?” Ontario Racing ’s Chopowick counters that an extension of the current agreement would “ensure we don’t have the status quo,” adding that guaranteed funding would allow for much more detailed tracking of industry data — including auction prices, wagering, attendance, marketing and promotions.
“Probably within a couple of years, we’ll have a good grasp of how stable funding for purses is going to translate to positive results,” he said. “Under no circumstances will this be money going into some unknown outcome.”
The hope is that eventually the industry can wean itself from government support.
“We’re poised,” says Mitchell, “once we get this funding model put in place, to work away at our ultimate goal of having a more sustainable and viable industry. I think the challenge for the industry is to be more creative and innovative in how it develops products and handles the demand for gaming.”