Saratoga Law Conference Focuses on Industry Survival

At the annual Saratoga Institute on Equine, Racing, and Gaming Law in Saratoga Springs, N.Y., Aug. 6, the theme of the three morning presentations was survival.

The titles of the presentations—"Equine Welfare: Can the sport survive?"; "The New York OTB's: Can they survive?"; and "New York Harness Racing: Can it survive?"—posed audacious questions that a year ago might have seemed hyperbolic but this year seemed fair, if daunting, given the challenges faced by the racing industry.

"Can the sport survive, given the scrutiny that we're under regarding our horses' safety and welfare?" asked Andy Belfiore, executive director of the New York Thoroughbred Horsemen's Association. "I think the answer is a definitive 'Yes,' but we have a lot of work to do to make that happen."

Pointing out progress that has been made in the past decade regarding equine welfare—including tighter regulation and more opportunities for horses when their racing careers are finished—she said, "Sometimes that word doesn't get out to the general public, and we have to do a better job … of letting people know all that we're doing on behalf of our horses."  

Belfiore also serves as executive director of TAKE2 Second Career Thoroughbred Program and Take The Lead Thoroughbred Retirement Program, both of which were established by NYTHA, and she used as an example the perception that horses are invariably euthanized after an injury.

"I guess we haven't done enough to explain that that's not the case anymore," she said. "There are so many options for our horses when they leave the racetrack."

Dr. Jennifer Durenberger, who holds degrees in law and veterinary medicine and who works as the chief examining veterinarian for the New York Racing Association, put it simply: "To ensure our industry thrives for generations to come, it's imperative that we begin to align our thinking with the majority view. If we derive income from animals, we have an obligation to ensure that their physical and mental well-being is considered throughout their career and that their 'post-commercial' life is a good one."

Noting voters—the majority view—play an important role in the evolution of laws regarding animal welfare, Durenberger asserted that racing industry executives must welcome independent third-party entities into the conversation about welfare, both to learn from them and to educate them about what the industry is doing to ensure humane treatment.

"They should learn about the industry from the industry itself, not from those who want to eliminate it," she said.

She also warned the industry needs to align its thinking with that of the majority view or risk following in the footsteps of greyhound racing, which has been outlawed in six states since 2010.

A threat of an entirely different kind—loss of revenue—was the focus of the OTB panel, which looked back to the bankruptcy of New York City OTB in 2010 and forward to the time when sports betting, which was approved this year in the state, will be added to the gambling menu.

John Signor, the president and CEO of the Capital District Regional Off-Track Betting Corporation, displayed slides showing the drop in off-track wagering across the state over the past 15 years. Citing challenges to profitability that include statutes regarding the financial structure of the state's five off-track betting corporations and state surcharges, Signor highlighted the variety of customer incentives offered by Capital OTB and the company's local television channel, which broadcasts handicapping and interview shows daily.

When NYCOTB went out of business, NYRA lost a major source of simulcast wagering, one that has not yet been completely replaced and that highlighted the unusual nature of New York's OTB structure, in which the racetracks are completely separate entities from the off-track betting companies.

Acknowledging that Capital OTB is both a NYRA partner and competitor, NYRA president and CEO David O'Rourke said, "I think the business models need to evolve. There's an opportunity for us to take a new look at this. It can be profitable. New York City is the largest market in the country for this, and it's not being operated right now."

Jack Jeziorski, the executive vice president at Monarch Content Management, addressed the structural problems head-on, saying the five OTB operations in the state all have different websites and wagering platforms. In addition, NYRA has its own advanced-deposit wagering platform.

"You need a single ADW to have brand power in the state of New York," he said. "And they have to integrate sports betting and horse racing."

His assessment was frank. "I don't think New York OTB can survive very much longer. I'll go ahead and say it: New York OTB should cease to exist … and it should be put underneath the direction of NYRA."

Bennett Liebman, a government lawyer-in-residence at Albany Law School, introduced the day's program by observing that various entities in the racing industry have been crying for years that the sky is falling.

"Now," he said, "we're all Chicken Little."

Teresa Genaro moderated the OTB panel. During the summer, she works for Capital OTB, scheduling guests for morning interview shows.