The most vital program in Canadian horse racing is in limbo and no one seems to be talking publicly about it. Worse, there’s growing concern it’s not getting much attention privately, either. Which makes it either the elephant in the room or we have become way too complacent.
While we wring our hands over how to increase handle and pool purses and market a sport in decline and develop our own V75 and reduce takeout — all important issues we’ve discussed at length, too — all those matters are small potatoes compared to the huge spud that is Ontario’s slots-at-racetracks program.
I’m sure you know the vast majority of purses in the province are funded by the industry’s cut of slot machine revenue — to as much as 90 per cent if we again use the woeful Woodstock Racetrack example.
But did you know that the long-term contracts — or site-holders agreements — have expired at six Ontario tracks, by my count, with the contracts at three more tracks set to expire before the end of 2010?
The initial site-holder agreements each track signed with the Ontario Lottery and Gaming Corporation (OLG) that runs the slots-at-racetracks program were, to keep things simple, 10-year deals.
Since the OLG contracts began the day each track opened its slot parlour, that means 10 years has come and gone at Windsor Raceway, Hiawatha Horse Park, Western Fair Raceway, Sudbury Downs, Rideau Carleton and Fort Erie. All six are in limbo, from what I can gather, operating with short-term roll-over contracts.
Don’t blame the horse racing industry for inattention to this matter. For nearly a year-and-a-half, a subcommittee of the Ontario Horse Racing Industry Association (OHRIA) headed by Jim Bullock and buoyed by OHRIA executive director Hec Clouthier has been quietly lobbying key politicians with a compelling message.
“The horse racing and slots have put $1 billion net into the coffers of the government,” Clouthier said. “Whereas, if you combined the resort casinos and charity casinos, it’s $300 million. So, what we basically said was, ‘Don’t bite the hand that feeds you. Secondly, we’re one of the very few industries in this day and age... saying, ‘We’re not coming here, cap in hand, looking for more. All we want is to maintain the status quo.’”
By that, Clouthier means the all-important revenue cut of 20 per cent to the horse racing industry.
While there was some concern about the government reducing the industry’s revenue cut when George Smitherman was the man in charge of the industry, now that the OLG falls under the Ministry of Finance, indications are that Minister of Finance Dwight Duncan is more amenable to the 20 per cent status quo.
Though, it’s hard to know for sure. I’ve spent a month asking people in the government supposedly in the know about the status of the slots-at-racetracks program for an update. What little I received is troubling, especially since the program has, as Clouthier said, netted the government $1 billion. I guess that’s chump change to a province currently facing a $19.7 billion budget deficit.
I began with a man, who I’m told by many sources, is handling the file in the Ministry of Finance. Naturally, this person put me on to “communications staff,” which took two weeks to, effectively, not answer, eight questions I emailed to them.
In essence, I wanted to know the level of commitment the government had to the program, whether they were considering changing the revenue splits, how many tracks were in short-term roll-over contracts at the moment, when longer-term deals could be expected, what the length of those contracts might be and whether the government planned to include a provision in the next round of longer-term agreements making capital improvements at tracks mandatory.
An incredible seven times, Staffer “X” responded with, “Site holder agreement extensions for the Slots at Racetracks program are currently under review. The OLG is responsible for renegotiating these agreements with racetrack operators.”
I might be a little slow, but here’s what I’ve learned: (1) The OLG is responsible for the slots-at-racetracks program, which is good to know; (2) Staffer “X” knows how the copy and paste functions work on his computer.
That took two weeks?
Trouble is, when I sent the same questions over to the media team at the OLG, “John Doe”, came back nearly a week later with this: “OLG has not received government direction on how to proceed on new site hold agreements” and “OLG is waiting for input from the horse racing industry and also gov’t before it proceeds with re-negotiations of any site holder agreement with existing race tracks containing OLG Slots facilities.”
So, the Ministry of Finance says it’s an OLG matter and the OLG says the Ministry has given it no direction.
Now, likely, all of this is baffle garb. But I do wonder why, if the OLG is trying to say nothing, they would throw their political masters in the Ministry of Finance under the starting gate by saying they’ve received no political direction if that wasn’t, in fact, true.
Here’s some theories: Translation #1: We might, or might not, be dealing with it and we choose to tell you nothing. Translation #2: We aren’t dealing with this at all and we might get around to it when we damn well please. Translation #3: We have slots at racetracks? I didn’t even know there was horse racing in Ontario.
Look, I’m not surprised I didn’t get far with the government. This tiny trade magazine covering a declining industry has no political expediency to people who sustain themselves on such.
Though, this does speak to government competency — or, more specifically, the lack of it. Also, slots-at-racetracks appears to be a low priority for the government. Neither bodes well, especially for tracks such as Western Fair currently stuck in a holding pattern operating on a six-month short-term contract.
“It’s a big challenge from the perspective of dealing with our banks,” said Western Fair chief executive officer Hugh Mitchell. “We’ve got a fair bit — as most racetracks do — of debt outstanding. Of course, they’re constantly measuring our ability to service that debt. Having a long-term agreement with the OLG will go a long ways toward helping us service the debt.”
On the purse side of the equation, another long-term agreement will certainly allay fears among the few aware this vital program is in abeyance, or soon will be, across the province.