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E. Barry Ryan
June 28, 1971
The chief of New York's new off-track betting system admits he knows little about racing, so a noted horseman explains the possible virtues and vices of OTB
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June 28, 1971

Putting The Case To Howie The Horse

The chief of New York's new off-track betting system admits he knows little about racing, so a noted horseman explains the possible virtues and vices of OTB

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Horse racing has been highlighted by two notable happenings this year. One was the arrival of Canonero II, who spared us a long wake just when we had begun mourning Hoist the Flag, the magnificent 3-year-old injured prior to the Triple Crown races. The other was the establishment in New York City of off-track betting.

Not since Native Dancer has a horse had the mass appeal of Canonero. In a single afternoon—Derby Day—the $1,200 castoff from Venezuela renewed public interest in racing, put the sport front and center in the news and made off-track betting a million-dollar wonder. Spurred by the interest in Canonero and the Triple Crown, OTB is on its way to being a huge success. Maryland, New Jersey, California and Illinois are talking of establishing their own OTB businesses. Something new and significant has surely come to U.S. sport.

Americans long should have had the right to wager on horses without going to racetracks or dealing clandestinely with bookmakers. For quite a while the Australians, French and English have bet off the track. But in this country the right was denied, in part because as a form of gambling it was viewed as an immoral pastime but also because racetrack operators feared this kind of wagering might diminish attendance and mutuel handle, their sources of profit.

Actually, if it is properly administered, OTB can make the $7-billion-a-year horse racing industry lastingly secure. It can, and it should. There need only be a fair sharing of revenue among the four partners involved: state, municipality, racecourse and horsemen. Unless such a relationship exists, tracks and horsemen will be unable to operate because of their loss of income.

For example, at New York's Belmont Park an average customer bets $100 a day. Seventeen per cent of this $100 is deducted, with the balance returned in payoffs to the bettors. The $17 is divided as follows: $10 goes to the New York State treasury, $4 to the New York Racing Association, which operates the track, and $3 to the horsemen for purse money. The same $100, when bet through OTB under present law, yields $15.50 to state and municipal treasuries (specifically, New York City gets $12.40 and New York State $3.10), $1 to the NYRA and a mere 50� to the horsemen.

The inequity is obvious; the division is unfair. In addition, there is no provision for any distribution to either horsemen or tracks in the case of separate pools, such as the ones New York City conducted on the Kentucky Derby and the Preakness. This amounts to taxation without representation. The recently formed Horsemen's Advisory Council, composed of men professionally identified with thoroughbred and standard-bred racing, did prevail upon OTB Chairman Howard Samuels to turn over 1% of the off-track Belmont Stakes handle—a sum amounting to $11,770—to the NYRA and its chairman, Alfred Gwynne Vanderbilt, graciously earmarked this amount for purse money. Although a pittance, it was at least something and it points up the possible benefits off-track betting has for the horsemen, who are, after all, the men who sustain the sport.

It would be unfair to criticize either Kent Brown, who is charged with instituting off-track betting in New York State, or Samuels, who holds the responsibility in New York City, for their often naive approach to the problems. Both men are self-admitted neophytes with little knowledge of the operations of the thoroughbred and standardbred industries. Brown and Samuels are simply doing their best to get OTB started and are under extreme pressure from the state to do so. As a result, some of their decisions have been hasty and made without a thorough understanding of the mechanics of the sport.

Since OTB is almost certain to become a nationwide phenomenon, the concern among horsemen is that these same mistakes will be repeated elsewhere in the mad scramble to get a piece of the gambling pie. Within five years, according to conservative estimate, most of the 30 states that have legalized pari-mutuel betting will have off-track wagering facilities, and some states without racing (viz, Connecticut) are already attempting to cash in on the bonanza. So it is vital that the lessons Of the pioneer state, New York, be carefully studied in order to set up the fairest possible return for all concerned.

There has been for some time a struggle for revenue between horsemen and tracks on one side and exceedingly greedy state treasuries on the other. States obviously want all the tax moneys they can get. Horsemen and tracks are faced with annual cost increases averaging 8%. National attendance figures are on the decline, probably due to the economy of the country as a whole. Extended racing dates increase costs and often tend to decrease the average attendance per day. A track's net profit is largely dependent upon admissions, concessions, sale of programs and parking fees. The horse owner's profit, if any, is dependent upon the good fortune of owning one or more stakes performers. And there are precious few of these.

In short, everyone is scrambling for funds, and little cash remains to be spent on some very necessary improvements in the sport, i.e., for better working and living conditions for stable employees, including facilities for the ever-increasing number of females (now 10% of the backstretch labor force at Belmont Park). Educational programs should be established for the growing number of Latins entering the field. There should be more adequate backstretch pension and welfare programs, increased health benefits, emergency hospitalization facilities, schools for apprentice jockeys, harness drivers and grooms and equine hospitals and research, particularly in communicable diseases—an epidemic could close down U.S. tracks within 72 hours.

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