Leal deserves more credit: Walling
Consultant defends Liberal MPP’s record in trying to keep harness racing alive at Kawartha Downs
Greg Walling believes Peterborough MPP Jeff Leal is not getting a fair shake from Kawartha Downs management or area horse people.
Walling has served as a consultant, for $1 a year, for Leal, who is also the Minister of Agriculture, Food and Rural Affairs, on the transition of horse racing after the Slots at Racetracks Program (SARP) was eliminated by the Liberal government. Walling also consulted on the creation of a $105-million per year, 19-year funding agreement 12 of 15 Ontario tracks signed last month. The deal was put together by Ontario Lottery and Gaming Commission and Ontario Racing officials.
Kawartha Downs is one of three regional tracks, along with Lakeshore and Hiawatha in southwestern Ontario, not to sign the agreement which takes effect in 2019.
Kawartha Downs general manager Orazio Valente, who has run the Fraserville track since it went into receivership last year, has been a vocal critic of Leal and the Liberals. He has stated he sees no future for KD under a Liberal government and he’s courted PC and NDP candidates in hopes of reaching a better deal under a new government.
Local horse people, represented by the Ontario Harness Horse Association, have also not signed the deal and voiced support for Valente while criticizing the Liberals. The provincial election is Thursday.
Walling acknowledges the Liberals created flux in the industry by eliminating a mismanaged SARP program rather than fixing it. But he says if it wasn’t for Leal’s initiative the horse racing industry would never had got $500 million in transition funding over the past five years or the new funding deal.
He says Leal recognized tracks that are losing their slots facilities, like KD will this fall, needed extra help so he fought for additional funding to help those tracks diversify their operations. By not signing the latest deal, Walling said, KD loses out on the ability to tap into that funding.
“This idea that Minister Leal has let them down is a history lesson that needs to be told,” Walling said.
“Certainly, things were done wrong by the government when the initial change of funding horse racing was done … but if it wasn’t for Jeff Leal and Ted McMeekin it might not even have been restructured. Minister Leal went and got the initial $500 million.”
Walling disputes that KD management’s primary interest is in supporting horse people. He says the primary function of a receiver is to maximize a return on assets.
“This idea that the current ownership of Kawartha Downs cares about horse racing is just not true,” Walling said. “That’s the world I come from in my real job, insolvency.”
Walling, who ran for the Liberals in Haliburton-Kawartha LakesBrock riding in the 2006 federal election, was part of a three-person board which operated KD from 2013 to 2016. He says the new funding agreement provides more than enough to run races at KD.
The track has provided a budget to OLG which shows a $2 million shortfall once the slots leave. That includes $1.4 million of operating costs such as management salaries, accounting, property taxes, insurance, security, maintenance and utilities. It also includes more than $500,000 in proposed upgrades to the facility.
Walling says the $1.4 million are current expenses that will decline significantly once the slots move.
“You don’t need $400,000 in management staff if you’re going to have 18 races,” Walling said. “I’ve seen the $2 million shortfall and it assumes status quo. There are lots of places that run 18 races and assume the same infrastructure as Kawartha
Downs and they’re doing quite fine. It’s that they want a return on their investment.”
Walling says it’s not the government’s role to service the KD debt or make a profit.
The other issue, Walling said, is KD management has no interest in signing a 19-year deal because it doesn’t intend to ownthe property that long.
Valente says KD was not consulted during the creation of the new funding agreement. Walling says that’s not true. He said he spoke to Valente’s boss Richard Weldon, managing partner of Romspen Investment Corp., weekly and at times daily throughout the process. He said Weldon insisted the agreement cover the $2 million shortfall and he wouldn’t move off that stance.
Walling said claims that OLG and OR want to reduce the industry to 12 tracks, eliminating regional tracks, is fear-mongering. He says he was once concerned that Woodbine Entertainment Group (WEG) had too much influence in the industry. Now, he says, the new OR board represents all stakeholders in the industry giving everyone a voice.
“This idea that this plan was built by the Liberal government isn’t true,” Walling said. “It was built by the staff of OLG, the volunteers at OR and multiple racetracks with all kinds of input.”
Walling believes in the new deal. “It’s not static,” Walling said.
“One thing OHHA has said and Orazio has said that is completely incorrect is that this is the amount they are going to be funded at forever. There is $10 million more available in three years to the non-WEG tracks. That’s a lot of money.”
That money, says Walling, is intended to increase purses and race dates, for tracks which show it can be supported, to help horse people make a better living.
You don’t need $400,000 in management staff if you’re going to have 18 races. GREG WALLING CONSULTANT TO JEFF LEAL