Gordon Robinson | Gallop to horse racing's rescue
Now that divestment of Caymanas Track Limited's (CTL) operations to Supreme Ventures Limited (SVL) appears to be nigh, it's a good time to revisit those essential ingredients to a horse racing industry's profitability.
A quick canvass of successful horse racing jurisdictions establishes the following as foremost among prosperity fundamentals:
1. Low tote takeouts. Currently, Jamaica ensures losses by withholding an unbearable 30 per cent on win/place and 40 per cent on exotics;
2. Absence of parasites attached to the tote and draining its lifeblood but disguised as 'bookmakers'. In the most profitable horse racing industries, legal bookmakers don't exist;
3. No or select few OTBs. Instead, Internet/telephone betting eliminates this expensive middleman;
4. No freeness mentality.
Low Tote Takeouts
It's easier for a camel to pass through the eye of a needle than to find another country with Jamaica's level of Tote takeouts. Lower takeouts encourage repeat betting and, in the long run, significantly higher promoter's sales. If Tampa Bay Downs (Grade B Florida track) were to introduce significantly lower tote takeouts than Gulfstream Park (Grade A Florida track), then, despite the Gulfstream's more attractive racing, Tampa Bay would outsell that celebrated track. The reality is that BOTH tracks take only 17 per cent from win/place/show and 20-26 per cent on most exotics except Pick-6s (20% Gulfstream; 18% Tampa Bay).
There are no legal horse racing bookmakers in the USA, Australia, Japan or Hong Kong. There are no bookmakers, properly so called in Jamaica, but the racetrack must endure a set of leeches in bookies' clothing that lazily set up mainly cheap, ramshackle shops and take horse racing bets at tote odds. In a small betting market, with CTL encouraging this counterproductive practice by insane takeouts guaranteeing huge profits to indolent 'bookmakers', the result is CTL's drip-drip-tap-drip suicide by incompetence.
Jamaica's reality is one racetrack, no Internet betting, and fewer OTBs than ever, literally forcing punters into bookie shops to bet. In England, where the best example of a bookie-racetrack symbiosis exists, bookmakers make their own book, offer competitive odds, have secure website alternatives for international customers, and thereby increase betting interest in a global market with limitless potential for expansion.
English bookies are also forced, through strict regulation, to make direct, substantial contributions to horse racing's operational costs, especially purses. In Jamaica, our constantly scheming 'bookies' tricked an ill-advised government to shift taxation from gross sales to easily manipulated 'gross profits', make zero contribution to the cost of operations, and pay a paltry sum to CTL for the tote dividends.
If Jamaican horse racing is to survive, a radical clean up of this farcical bookmaking industry is necessary. Modernisation, fair competition and computerisation should be the watchwords. Old-fashioned 'clock-bag' bookies shouldn't be licensed.
In 1990 when the iconic Danny Melville forced government to buy new tote equipment and open OTBs islandwide, it heralded a betting revolution whereby, for the first time (at last), punters could bet directly into the tote from anywhere in Jamaica. Previously, archaic off-track betting operations were conducted in a separate pool and betting was terminated 10 minutes to post time to facilitate reporting of bets. After the race, two separate dividends were declared.
OTBs created one bigger betting pool, higher dividends and more customers. Over the years, technological advancements and OTB mismanagement have turned OTBs into albatrosses. Significant percentages of declared sales became uncollectable receivables, runaway maintenance costs are uncontrollable, and intractable losses inevitable. It's time for another revolution. It's time to embrace virtual technology.
No Freeness Mentality
As CTL chairman, 'Big' Joe Matalon tried to introduce a minuscule 'stall fee' payable by trainers to offset stable area maintenance costs. The backlash was so intense he was hung, drawn, quartered, tarred, feathered AND run out of town on a rail. As business-savvy as he was, he represented a "run-wid-it" shareholder who refused to be convinced that, in business, profit trumps popularity every time.
SVL is unlikely to have similar corporate attitudes. CTL currently absorbs ALL stable-area costs including free air-conditioning for Trainers' offices; garbage collection; stable maintenance etc. This is ridiculous. Trainers must pay these costs and pass them on to their owners. In USA, keep and care costs to owners average US$75 (J$9,500) per day per horse. In England, the Queen's trainer, Sir Michael Stoute, still considered the world's best, charges PS75 (J$13,500) per day. At the second tier (e.g., Willie Haggas; John Gosden) the fee is PS65 (J$12,000) per day. Third-tier trainers charge PS55 (J$10,000) per day. These costs include renting and maintaining the 'yard' and gallops; utility bills; exercise riders; and staff.
The last time I paid a training bill to Jamaica's 15-time champion trainer, the keep and care was less than J$2,500 per day, although every one of his inputs is imported. Jockeys collect 10 per cent of owners' purses, even if they lose the race through corruption. Grooms are paid a weekly wage PLUS five per cent of the owner's purse. Only in Jamaica, where we're running a charade instead of an industry, do participants get such a free ride.
I expect SVL to negotiate serious terms with Government if it's to make this a success:
1. Regulators must be facilitators for business and economic growth, NOT professional obstructionists. Internet/telephone betting must be allowed from Day One.
2. SVL must be allowed to charge a reasonable rental per stall to offset backstretch costs or trainers must be responsible for all backstretch costs, including stable maintenance;
3. Point-of-sale costs must be minimised and no obstacle put in the path of an OTB phase-out;
4. No bookmaker's licence should be issued to any non-computerised operation and bookies must make significant annual contributions to the promoter's operational costs. Contributions/licence fees/taxes could be graduated to incentivise bookies who make their own books or become CTL agents on local race days.
Another way of saying 'No Free Lunch' is to insist participants respect the sport. Recent panoramic coverage of Epsom Derby/Royal Ascot meetings on SportsMax showed Jamaicans what's required, so it was wonderful to see Jamaica Derby winning trainer, Wayne DaCosta, dressed up for Derby Day in jacket and tie with wife, Liz, and daughter, Stephanie, in outfits we'd expect to see at Royal Ascot.
Also, congratulations to Spencer Darlington and his TVJSN team for high-class coverage of the blue-riband event. Spencer showed his more experienced rivals how to anchor this special event without hogging the show or apathetically repeating Friday night's gambling picks ad nauseam. This lowers the tone to inappropriate and restricts information viewers/listeners expect on Derby Day.
Unfortunately, the spectacle was ruined by stewards who don't seem to understand their jobs are best done when nobody notices them. The double disqualification of first and second past the post in as prestigious a race as the Derby was unwarranted, unjustified and spoilt what was otherwise a magnificent promotion. Tired horses will wander about in 12-furlong races, but the draconian punishment of disqualification, when neither second - nor third - place jockeys once stopped riding their mounts; the winner had been in front (or disputing) from seven furlongs out; and the final two furlongs brought the house down, is not an option, especially as the best horse obviously won.
Disqualification of second-past-the-post BigDaddyKool for an 'offence' that took place all of four furlongs from home and was the fault of another horse stopping in his path, leaving young Steadman (why do trainers continue to declare apprentices unable to claim in Classics?) with little option, was even more ridiculous. Orpheus recovered quickly; entered the stretch in front of BigDaddyKool but soon went a half-length down and never looked like passing BigDaddyKool (2nd/3rd whips tangled; both were lost) despite the kitchen sink being thrown at him.
No matter what happened between first and second, Orpheus had a clear stretch run; could make no impression; and was patently third best. That he was gifted a Derby he couldn't otherwise win is a travesty of justice akin to Anne Boleyn's execution AND proof that stewards don't understand discretion. Are my sources correct that winning jockey Robert Halledeen was refused entry to the stewards' room to assist in the enquiry? But what can we expect from stewards with minimal training in reviewing films, taking evidence or reading/interpreting rules?
Last chance, folks, to make this horse racing thingy work. We live in a global village. Nobody is obliged to support an inferior, customer-unfriendly local product where, even when punters win, they lose.
Peace and love.
- Gordon Robinson is an attorney-at-law. Email feedback to firstname.lastname@example.org.