A new plan for Ontario's racing industry

Thursday, October 10, 2013

by MATT MCINTOSH and SUSAN MANN

Ontario’s horse racing industry is at a tipping point say its representatives and they question if the Ontario government’s five-year $400 million plan announced today in Elora to build a sustainable industry is enough to strengthen and support its future growth.

photo: Kathleen Wynne

Premier and Agriculture Minister Kathleen Wynne announced the investment at Elora’s Grand River Raceway along with outlining the government’s vision for a sustainable horse racing industry.

“We needed to recalibrate the industry,” says Wynne. “What was in place before wasn’t sustainable. There wasn’t an acceptable level of transparency.”

That $400 million – $80 million per year – will be divided between the standardbred, thoroughbred, and quarter horse racing divisions.

The government’s vision also involves integrating horse racing with the Ontario Lottery and Gaming Corporation’s overall gaming strategy, and separating the Ontario Racing Commission into two divisions: one for allocating funds, and another that will, according to the government’s press release, continue its existing regulatory functions.

The changes don’t eliminate concerns over the industry’s future but some observers say the government’s monetary investment is positive.

“Sales have dropped more than 40 per cent, and there’s really no incentive for us to continue breeding these horses,” says Glenn Sikura, breeder and president of the Canadian Thoroughbred Horse Society (Ontario division). “The weight has been put on the shoulders of the breeders. We just have to wait and see what this plan will do.”

Keith Currie, Ontario Federation of Agriculture executive committee member, also expresses concern with the plan.

“This investment is a step in the right direction, but our horse farmers have experienced a lot of bad news and are not sure what to expect. I guess you could say we’re cautiously optimistic,” says Currie.

Brian Tropea, general manager of the Ontario Harness Horse Association, says the funding is more than the transition money the industry was getting after the government announced in 2012 it was cancelling the Slots at Racetracks revenue sharing program. That funding was $180 million over three years. But it’s significantly less than the $345 million in annual funding the industry used to get from sharing the slots revenues with the government.

“A lot of people and horses have already left the province,” he says. “I didn’t see enough in the report or the announcement today to encourage those people to come home.”

MPP Randy Pettapiece, the Progressive Conservative’s rural affairs critic with responsibility for the horse racing industry, says he hasn’t yet analyzed the plan in detail but it’s “too late for a lot of people.”

It will be hard to put the industry back to what horse industry members hoped it would be, he adds. “That’s the disappointing part of the whole thing.”

Will the government’s plan stop other horses and industry personnel from stampeding out of Ontario? Possibly, Tropea notes. If people are happy with the racing opportunities and available purse money for this year, they will stick around. But if they stayed in Ontario this year hoping things will get better “with this announcement, I think they will be disappointed.” The government’s plan will also do nothing to stop more tracks from closing.

Ontario Lottery and Gaming will still have slots at racetracks, Tropea says, and race- track operators will continue to be paid rent for allowing the corporation to have its slots there. The report says the track operators combined get $100 million from the corporation now for renting their facilities for slots.

The plan was developed by the Horse Racing Industry Transition Panel made up of Elmer Buchanan, John Wilkinson and John Snobelen.

There are some red flags in the panel’s report, says Tropea.

For example, thoroughbred racing at Fort Erie has been gutted. The report suggests some type of racing festival be held at Fort Erie “which would seem to indicate a very short meet,” Tropea says. “It’s not something that would maintain a herd of horses in that area of the province.” People in that area will need to move somewhere else to find racing opportunities, he says.

The plan also leaves many unanswered questions, Tropea says. For example, how will Ontario Lottery and Gaming work with the changed structure of the racing commission, who makes decisions on where new gaming opportunities are launched, and what kind of gaming will be implemented?

The chair of the racing commission, Rod Selling, has resigned and transition panel member Elmer Buchanan has been nominated as his replacement. Tropea says he’s not disappointed with the change. “I’m looking forward to someone coming in with some fresh ideas.”

The transition’s panel’s five-year plan talks about integrating horse racing with the Ontario Lottery and Gaming’s gaming strategy so that some revenue for the industry will come from additional gaming opportunities or partnerships, he says. But “what does that mean? What kind of products are we looking at, how fast can it be implemented, and what kind of revenues can we expect?”

Tropea says they don’t have those details yet, nor have they been told when they’ll get them.

The plan calls for the implementation of an alliance of eight racetracks: Clinton, Hanover, Grand River, Western Fair, Flamborough, Georgian Downs, Mohawk and Woodbine. Those tracks will share 90 per cent of the revenues that are generated, Tropea says. “Essentially horse racing looks like it will take place in central Ontario.”

Tracks outside that core group will be “in a tenuous situation” because the panel report recommends they share 180 days of racing and $5.4 million in purse money, Tropea says.

Currently there are 15 tracks open in Ontario. The tracks outside of the alliance are: Sarnia, Dresden, Woodstock (which didn’t have races this year), Sudbury, Ottawa, Peterborough and Fort Erie. The track in Windsor has been closed for one and a half years.

Sue Leslie, president of the Ontario Horse Racing Industry Association, couldn’t be reached for comment. BF