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Bold Play for Monticello Horsemen

Below is text of a blog posting explaining the standoff at Monticello. A link to the original posting can be found at the bottom of the story.

I do recommend that you read, in their entirety, the two statements, linked to below, that Alan Schwartz, the president of the Monticello Harness Horsemen's Association, has released regarding the ongoing standoff between the track/casino management and the horsemen who are blocking the out-of-state simulcast signal. As we mentioned here, this is hardly your ordinary signal dispute. The Monticello horsemen are raising an issue that goes far beyond their track, and which could reverberate around the state and, eventually, if and when more revenue is at stake, in Albany.

At the heart of the dispute is the casino enabling law which freezes payments towards purses from VLT revenue at 2013 levels for any track which gets a casino license. It was originally portrayed by casino interests to be a "floor" to allay fears that the racinos would remove the electronic slots from which, by law, a percentage goes to racing, in favor of new games from which racing will get no share. (Please excuse me for one of my occasional horn toots, but as I feel as if, while the mainstream press reported it as a floor at the time, I pointed out the cap part right at the beginning.)

In the first statement, the Monticello horsemen explain why they believe that this is about nothing less than the survival of their sport.

The Monticello stalemate is about saving our industry from those private New York racetrack operators who want to morph into standalone casinos. It is about an effort to stop the track owners from destroying harness racing by actively telling legislators and other government officials in Albany that increasing the track operators profits and shortchanging racing is the right thing to do..... These track operators engineered a law that will, for all intent and purposes, freeze our industry out of existence in the long term. Tell your supplier of feed, your vet and blacksmith that they can't raise their prices above 2013 levels in the years to come because of the selfish action of the NYGA track owners.....As was said not too long ago "If you don't fight for your future, you may wake up one day and wonder why you don't have one."

(I Googled that quote to see just who said it not too long ago, and I think that maybe it was just Schwartz himself since his statement is the only thing that came up!)

Things get even more interesting in the second statement. I'd wondered aloud here what the horsemen meant to accomplish considering that the cap is written into a law that neither Empire Resorts, the owner of Monticello, nor the NYGA can change themselves. And indeed, management has accused the horsemen of trying to amend the law via their actions.

That however is most definitely not what they are trying to do. Forget the law, and the cap, and the VLT's. The Monticello horsemen quite simply want management to, of their own volition, cut them in on a piece of the casino action.

In the meantime, and separate from these ongoing efforts in Albany [to amend the law], our Monticello horsemen have simply proposed - as part of a contract negotiation between two private entities - that Monticello make some level of additional payments from their own revenues/vendor's fees to racing, should they be granted a full casino gaming license. As noted above, while our purses now have a hard cap imposed on them, the Monticello Casino will have no similar cap imposed on their revenues or their profits, and so we are simply seeking a reasonable opportunity to continue to grow the agricultural/farming and racing industry and work together to succeed right along with them as we had when we partnered with the tracks to start a VLT program in NY.

So, far beyond VLT revenues, the horsemen are going after the revenue from the new casino games that has been carefully and conspicuously shielded from racing, no doubt something that NYGA has worked hard to ensure. It's a bold ploy, made possible only by the power that the 1978 federal law gives horsemen's groups to block the out-of-state simulcast signal. (Except for those at NYRA....as long as it remains a non-profit association, anyway.) Anything that they may be able to accomplish will surely serve as a precedent for other tracks that become full casinos in years to come, upstate and, sooner than you may think, downstate; so I imagine that NYGA is paying very close attention. Monticello is a small track in terms of wagering, so management could just cut purses and this dispute could possibly go on for quite some time without many people noticing. But the harness horsemen are surely serving notice to the rest of the NYGA. And the state will start to notice as well should this action spread to other tracks.

As far as the thoroughbred horsemen go, even should the non-profit status of NYRA change when it emerges from state control (which I don't think it will) and thereby give the horsemen control over the signal, they are still in a different situation from their harness brethren with the Aqueduct racino under separate ownership. Genting has no stake in the simulcast signal. But given the materiality to the state of the revenue it receives from the ample out-of-state wagering on NYRA racing, I'd think they could still make a play should precedent be established at the harness tracks. But that's all speculation and years down the line.
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