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Illinois Thoroughbred Horsemen's Association

Illinois Thoroughbred Horsemen's Association (4/12/13)

ITHA Board of Directors Statement of Policy Positions

We the undersigned Directors of the Illinois Thoroughbred Horsemen's Association are the duly elected and appointed representatives of horsemen at Arlington Park and Hawthorne Racecourse.

ITHA Positions, As Approved by the Board:
Tracks and ADW Providers Should Share iGaming Revenue with Purses, Arlington Should Abandon Any Plan to Charge Stall Rent, and Illinois Should End the Recapture Subsidy Undermining Purses
The ITHA is proud to advocate for the interests of horse racing, the horsemen who make our sport possible, and the more than 35,000 jobs that we support in Illinois agriculture. We are dedicated to protecting and enhancing purses, growing live racing opportunities, saving jobs, and ending the state's recapture subsidy.

Unfortunately, parties determined to distract ITHA from its advocacy efforts have promoted the notion that ITHA's spending is anything but sound and dedicated to advancing the interests of Thoroughbred horse racing. Additionally, these parties have repeatedly mischaracterized the ITHA's clearly articulated policy positions.

We serve the finest horsemen we know. Out of an abundance of transparency, we write today to reiterate our policy positions and details of our budget.

Internet Gaming Revenue

For more than a decade, Illinois lawmakers have contemplated allowing tracks to offer casino-style games as a means to generate additional revenue to support purses. When this revenue supports purses, Illinois horse racing will more adequately compete against racing in other states. And when horsemen stay and race in Illinois, they support not just the people who will directly lose out if the legislation is not changed, but also more than 35,000 jobs throughout the Illinois ag economy, from veterinarians to feed and hay suppliers.

We fully support allowing tracks to host slot machines and offer casino-style games online as a means to support purses. Let's remember that tracks would earn this gaming privilege solely because of their association with horse racing. Generating additional revenue to bolster purses - to save horse racing, preserve jobs, and support Illinois agriculture - is the entire point of letting tracks venture into casino-style gaming.

Unless Senate Bill 1739 is amended to require tracks and ADW providers to share Internet gaming revenue with purses, the proposal threatens to radically diminish Illinois horseracing and, in the process, cost thousands of middle class and lower-income workers their jobs, harming the best interests of the state of Illinois and its taxpayers.

Stall Rent

This year, Arlington authorized itself to charge stall rent from horsemen during live racing. Other Churchill Downs Inc. tracks have imposed rent on stalls during dark time, but Arlington's rent plan marks the first time in the history of Thoroughbred horse racing nationwide that horsemen may be forced to pay stall rent during live racing. Arlington is a subsidiary of CDI.

Specifically, Arlington published its 2013 stall application in February, and paragraph 29 of that application stated: "A stall rent may be imposed on trainers that do not average one (1) start per stall per month or on a horse which runs at another racetrack in a race and condition that Arlington offers and runs."

This stall rent proposal does not specify the cost of stall rent; the potential charge is left open-ended.

On March 1, Arlington warned horsemen against modifying the language of its stall application. In a message to horsemen, the track said, "Arlington will begin allocating stalls immediately for the 2013 race meet based upon the unaltered stall applications that are received by the deadline. Any stall application that is altered will be rejected and returned to the sender."

Then, on March 26, Arlington told horsemen: "It is our intent to work with horsemen to implement and refine the guidelines in 2013 with no fees and have the full implementation with a fee in 2014."

The ITHA Board of Directors has formally opposed allowing Arlington to adopt the authority to charge stall rent. We have repeatedly implored Arlington to strike this stall rent provision from the stall application, and then reissue the corrected application in advance of the May 3 meet. It is simply incomprehensible to ITHA that Arlington would insist on the authority to charge stall rent, then maintain that it won't actually charge stall rent. If Arlington has no plan to charge stall rent, then it should immediately rescind its stall application and reissue the application without the controversial stall rent provision.

Recapture Subsidy

Illinois lawmakers created the recapture subsidy to compensate Arlington and other Illinois tracks for the loss in live handle related to simulcasting their races across the globe. Those subsidy dollars come straight from our purses. So when the tracks lose money, the horsemen pay the bill.

In 2013 alone, Arlington will enjoy an estimated $4.1 million recapture subsidy - dollars that flow directly from the purse at a rate of $46,000 a day. Hawthorne and the state's other tracks collectively stand to enjoy another $8.9 million this year from this subsidy.

The ITHA has long stated that this recapture subsidy hurts Illinois horse racing by continually diminishing purses. The ITHA has long worked to abolish the subsidy. We continue to pursue abolition of this subsidy.

ITHA Budget

The ITHA is funded, by state statute and under contracts with the respective tracks, by a percentage of purse revenue. The majority of our funding is used for several critical programs that directly support horsemen, backstretch workers, and horses racing at Arlington and Hawthorne. Since 2007, the ITHA has increased benevolence and strengthened its legislative presence, while decreasing payroll and office expenses, all to the benefit of Illinois horsemen and the Illinois Thoroughbred racing industry.

We take strong exception to any inference that we are anything but thoughtful and responsible stewards of the money we collect on behalf of horsemen. The ITHA will continue to resist any efforts intended to divert our attention from the matters of actual, critical importance to Illinois Thoroughbred horse racing: amending SB 1739 to ensure that tracks and ADW providers share Internet gaming revenue with purses, growing live racing opportunities, and ending the recapture subsidy.

As Directors of the ITHA Board, we review and approve all ITHA expenditures at monthly Board meetings, which are open to our membership. The ITHA also conducts a general membership meeting at each meet - where, again, members may attend, review our expenses, and offer any input they may have.

The ITHA and its related benevolent and charitable entities received approximately $1.6 million for operations in each of the last two years, 2011 and 2012. Although ITHA's 2012 audit has not yet been finalized, here are approximates for monies spent, with the approval of the ITHA Board of Directors, in 2012:

  • 45% of expenditures went to the health, care and welfare of persons working, and the horses racing, at Arlington and Hawthorne. This included health insurance, medical and prescription payments, funeral expenses, chaplaincy, college scholarships, children's summer camp at Arlington, Thanksgiving dinner for backstretch workers, and a Christmas party for children of backstretch workers. We established Galloping Out, ITHA's successful Thoroughbred retirement program, in 2010, and it pays for the boarding, health care and retraining of retired race horses from our tracks.
  • 18% of expenditures went to attorneys, government affairs, accountants, consultants and political contributions. The ITHA devotes considerable effort to advocating, both at the tracks and at the Illinois Capitol, to protecting the rights and interests of the horsemen.
  • 23% of expenditures went to office, administrative and operating costs, including office equipment and supplies, the ITHA election, membership meetings, claiming insurance for members, association dues, maintenance and repairs of trailers, advertising, travel and lodging to Springfield and industry meetings, insurance for board members and employees, a summer picnic and Christmas dinner.
  • 14% of expenditures went to payroll and payroll taxes.

For comparison purposes, in 2007 the ITHA and its related groups took in $1.48 million. Of that, 32% was spent on the benevolent health, care and welfare of individuals (Galloping Out did not exist), 32% went to payroll, 23% went to office and operating expenses, and 13% went to legal, government affairs, accounting, consultants and political contributions.

As Directors of the ITHA Board, our ITHA budget and policy priorities are dedicated to supporting the men and women who enable horse racing in Illinois, and the equine athletes that make our sport possible. Having addressed any notion to the contrary, we now return our attention to actual, pressing priorities: protecting and enhancing purses, growing racing opportunities, saving more than 35,000 jobs in the Illinois ag economy, and ending the egregious recapture subsidy.

We hope other parties will do the same.

Directors of the ITHA Board:

ITHA Directors

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