Thoroughbred racing needs informed direction
Howard Hamilton, Contributor
The major investors in the racing industry and the leading stakeholders expressed some
I do not think that any of the directors appointed to the board of Caymanas Track Ltd (CTL) are familiar with the racing industry, and these appointments seem very strange, indeed. Some would argue that this is an indication of the total disrespect which this Government has for the racing industry. I would rather believe that the Government does not understand the value of the industry and it has been badly advised. Stakeholders will have to learn to work with what they have been dealt and give love a chance.
There is an immediate crisis with the announcement that bookmakers will cease taking bets on local racing with effect from Saturday, May 5 (today). This is in protest of the implementation of the mediator's report on the payment of rights fee to the promoting company.
The minister with portfolio responsibility for racing has now ruled on the report submitted to the previous government last year. The recommendation is, in fact, reduced from that recommended in the report. The ruling is that bookmakers must pay six per cent in 2011, seven per cent in 2012 and eight per cent in 2013. Subsequent years will be subject to negotiation. Although there was an agreement for both parties to abide by the decisions of the mediator/arbitrator, it would appear that the bookmakers are now reneging on that agreement. It is important that those considering this impasse be guided by the following:
1) The only source of income available to CTL is that which is generated by the totalisator pool (pari-mutuel). It follows that any dilution of this pool will make it impossible for the promoter to meet its commitments to stakeholders. This is an important consideration for the Government to understand especially at this time when they seek to divest themselves of an industry which they should never have forcefully expropriated.
The question to be asked: Would you invest in a company where more than 50 per cent of its production is siphoned off by a third party that makes no meaningful contribution to the cost of that production? This has been the dilemma facing promoting companies ever since our unique brand of 'bookmaking' was legalised in the early 1960s.
2) Thoroughbred racing is no longer the dominant player in the gaming sector. It, however, continues to provide an important contribution to the livelihood and career development of a wide range of professionals - veterinarians, jockeys, farriers, trainers and race track managers, all of whom are internationally marketable.
The racing industry supports major agricultural investment and makes a significant contribution to the social and economic fabric of this country. The expenses of satisfying the demands of all these participants have escalated beyond the levels of income which are internally generated. It follows that, in order for this industry to survive, there must be a comprehensive reform of the tax structure and a contribution from the other gaming activities. In all of this, we must never forget that horse racing is still the most popular sport, attracting thousands of people, not only to the track, but also to many off-track outlets across the island.
My suggestion for settling the current impasse are:
a) All bookmakers who wish to utilise the data from CTL must do so as agents of CTL and the tax structure must reflect this.
b) All bets offered by CTL and taken by the bookmaker must go into the pari-mutuel pool. It follows that CTL must provide the terminals to support this operation along with live audio and visual feeds.
c) Bookmakers must pay a rights fee for all bets utilising CTL data and not offered by CTL. This to include any fixed odds bets which bookmakers may wish to offer. This fee is to be no lower than the highest fee payable to any other provider of similar data.
Both the bookmakers and CTL will have to realise that it cannot be business as usual. This is the dawn of a new day and the old paradigms have to go. Both the Betting Gaming and Lotteries Commission and the Jamaica Racing Commission have to realise this awakening and remove all regulations and restrictions which prevent the full participation of bookmakers in the racing industry.
Bookmakers must now appreciate that they are important partners in an important industry and they have a major role to play. They have to clean up their act and remove the negative perception which has been precipitated by their behaviour in the past. Similarly, CTL needs to get their act together - where is the long -awaited elevator? This has been in storage so long that the manufacturers are probably now out of business.
We don't want to hear nonsense about "government this and government that". Go out, do what has to be done, and be man enough to take responsibility for your actions. The stakeholders will be right beside you and, if necessary, we will 'lock it down' or try to!
Howard L. Hamilton is a former chairman of Caymanas Track Limited and is the current president of the Thoroughbred Owners & Breeders Association.