NY Gaming Commission

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Significant challenges to integrity of NY casino selections

Posted by noonante on May 21, 2015
Posted in: Political/Social commentary. Tagged: , , , . Leave a comment

There are two serious challenges to the integrity of the decision recommending three casino licenses in New York.  While there is not yet litigation attacking the recommendations of the Facility Location Board, separate letters from attorneys, one representing the Oneida Indian Nation and the other on “behalf of several clients,” should cause New York’s regulators to pause.  The letters are typical of those seeking redress prior to litigation being filed.

New York’s Gaming Commission has the decision-making authority on awarding licenses for up to four casinos.  The Facility Location Board, appointed by the Commission to conduct a procurement and evaluate bids submitted by 16 applicants, published its recommendations on December 17.  After the Board reached its decisions, Governor Andrew Cuomo stepped in, implicitly criticizing the Board and “recommending” that a new procurement be done to select a fourth site.  The Board and the Commission apparently saw the wisdom of the Governor’s suggestion and promptly acceded to his request.

The essence of each letter is that the Facility Location Board’s recommendations are arbitrary and capricious because they did not follow their own rules and did not evaluate competing proposals in the same way.  It is a charge that goes to the heart of government procurement practices:  evaluation of bids should be open, accountable and capable of withstanding public scrutiny.  The Board’s recommendations meet none of these standards.

The law authorizing awards of casino licenses specified the evaluation criteria that had to be used in making decisions.  The law further specified the weight to be accorded each of the three broad categories.  Thus, “Economic Activity and Business Development” was a factor to be weighted as 70 per cent of all the factors.  Within each of the general categories, there were a number of specific criteria that had to be considered.  In “Economic Activity and Business Development,” for example, there were nine specific factors the Board had to consider and evaluate, such as maximizing revenues to the state and creating the highest number of quality state jobs.

The law clearly requires that a quantitative assessment be made of each proposal.  The Board further committed to making public its scoring of the proposals.  Then, they shifted gears.  Even though the evaluation criteria were set forth in the law, the Board decided to add an additional criterion.  It created this new factor in secret, neither announcing it during its evaluation nor informing bidders of the need to address it in their proposals.  It also decided to give their new criterion “substantial weight.”  While the law did allow the Board to create additional criteria, it should be obvious that the authority was for fine-tuning, not a secret process that would ignore the specific directives of the law on evaluating proposals.

Instead of factoring their new criterion into the weighted quantitative system mandated by the law, the Board further decided to abandon the quantitative aspect altogether in favor of a “qualitative” one.  If this were not enough of a divergence from what they were required to do, the challenge letters assert that even then the Board did not apply their new approach consistently in assessing the merits of each proposal.

In short, a Board that had its responsibilities specifically set forth in a law decided to ignore the dictates of that law and embark on their own determination of how things should be.  In doing so, they have called the integrity of this particular bidding process into question.  Their work product is now before the Gaming Commission that appointed them and must now make the actual decision on awarding casino licenses.  The Commission is meeting on Tuesday, but the meeting agenda has not yet been posted.  (The Commission’s staff is in assessing the financial viability of the bidders recommended by the Board.)  Update:  The Facility Location Board recommendations are not on the agenda.

To this point, the Commission has been fastidious in protecting the integrity of the procurement.  It would mark a substantial departure if it now accepted the incompetent and sloppy product of its appointees.  The flaws in the recommendations of the Facility Location Board are so significant that their decision is unlikely to survive independent scrutiny.  If the Gaming Commission does not remedy the problem, a court will.

The last time a gambling license was put out for bid, it resulted in the odiferous selection of an operator for Video Lottery Terminals at Aqueduct Racetrack that could not survive the light of day.  While I am not suggesting that this decision is akin to that one, I would be particularly cautious knowing there is a sitting grand jury with a zealous prosecutor seemingly eager to go after the Governor.

 

 

Aqueduct racing deaths are not the whole story (republished)

Posted by noonante on January 22, 2015
Posted in: Horse Racing, Political/Social commentary, Politics. Tagged: , , , , , , , , . Leave a comment

Recent news accounts have focused on the dramatic increase in fatalities occurring in races on the Aqueduct inner track.  The 12th catastrophic injury since early December occurred on Friday.  It seems to be a sharp reversal from the progress made by the New York Racing Association since a similar increase in the 2011-12 meet.  Yet that progress has not been replicated in reducing the fatalities that occur during training hours.  Just as troubling, however, is that recommendations by a special Task Force following a spike in racing fatalities in 2011-12 are not being followed.

I studied the record of all fatalities from the web site of New York’s Gaming Commission for the same three-month period, September through November, for each of the last four years.  Racing fatalities had dropped significantly, from a high of 13 in 2011 to a low of six in 2013 and then eight in 2014.  Conversely, training fatalities had increased from a low of six in 2011 to a high of 14 in 2013 before dropping to 10 in 2014.  When the number of racing and training fatalities are totaled, there has been almost no change.  We went from 19 in 2011 to 18 in 2014, with the intervening years being 16 and 20.

The inverse relationship between racing and training fatalities is curious.  It is further amplified when one considers that the high number of racing fatalities in 2011-12 and 2014-15 was matched in each instance by almost no training deaths on the inner track.  In this current period, there has been one fatality in the morning (but three at Belmont).  When a task force in 2012 looked at that meet’s 21 racing fatalities, it found no training fatalities at Aqueduct (but there were seven at Belmont).

Dr. Scott Palmer, New York’s Equine Medical Director, is aware of the disparity between New York’s overall success in reducing racing fatalities in contrast to the lack of success in cutting the numbers from morning training.  I asked him about this last summer, and he identified the factors that made identifying at-risk horses during training so much more difficult than for those racing.

Each horse who is entered to race is examined in the morning by a NYRA veterinarian to determine if the horse is sound, or has a condition that warrants the vet scratching the horse.  The vet should also equipped with records pertaining to the horse that might cause a red flag.  Horses in training, however, do not receive any scrutiny by NYRA’s vets.  While NYRA has on-track personnel to look for problems, including a new position of “Safety Steward,” it is close to being an impossible task to catch every potential problem.  Dr. Palmer did say that he continues to work on possible solutions to the training track fatalities.   NYRA did not respond to my request for comments on training breakdowns.

The spike in Aqueduct’s racing fatalities must be doubly embarrassing for NYRA.  The fatalities in 2011-12 were one of the factors supposedly used by Governor Andrew Cuomo to seize control of NYRA and replace it with a Board of Directors consisting mostly of state appointees.  And last week, the Kentucky Horse Racing Commission announced that it had experienced 12 racing fatalities for all tracks for the entire year.

Catastrophic breakdowns are a difficult issue with many possible causes.  All one has to do is look at a thoroughbred’s legs to realize that an awful lot of weight is being supported by those legs travelling at high speeds.  New York investigated the causes that led to the 2011-12 Aqueduct fatalities by appointing a blue-ribbon Task Force that issued a comprehensive report identifying several possible causes.  The Task Force also made over 100 recommendations that could serve as a bible for any racing jurisdiction seeking to reduce fatalities.

Unfortunately, it is not clear how committed New York has been to implementing the recommendations of its own task force.  Teresa Genaro, writing in Brooklyn Backstretch, has recently written about two shortcomings.

One has to do with the state’s monitoring of compliance with rules and protocols concerning the administration of corticosteroids.  Corticosteroids is a class of therapeutic medications used to treat a broad range of medical conditions (according to the Task Force Report).  It can also, however, have a side effect of masking unsoundness if administered too close to a vet examining the horse.  Repeated administration can also have serious long-term consequences.  The Task Force Report identified it as a potential factor in several of the horses suffering catastrophic injuries during the 2011-12 meet.

Even though treating a horse with intra-articular corticosteroids required a report to the state’s regulatory agency (now the Gaming Commission), the Task Force concluded that the agency neglected to monitor compliance with the regulation, describing it as a “serious deficiency.”  The Task Force recommended that the existing rule be enforced, and that a trainer who claimed a horse should be provided with the record of all IA corticosteroids within 48 hours by the prior trainer.  This last requirement is particularly important given the potentially harmful effects of over-administering the drug.

Nonetheless, monitoring of these requirements by the Gaming Commission has been deficient, according to Genaro.  While the Commission did conduct an audit in 2013, they do not appear to be aware of the extent of compliance with the reporting requirement.  Just as troubling, the transfer of records from one trainer to the claiming trainer appears to be close to non-existent.

According to the Genaro piece, the Gaming Commission spokesperson said that while 600 horses were claimed in 2013, he did not receive a single request for records.  Trainers are understandably reluctant to pursue the issue with a trainer they just claimed from.  The Gaming Commission has developed a software program that will enable the Gaming Commission to notify the claiming trainer of corticosteroid injections reported on the ESAL, a Commission database, and that it should be running in a few weeks.

A second troubling shortcoming identified by Genaro is the manner in which the state has implemented a panel charged with examining the cause of any exercise-related fatality that occurs on a NYRA track.  The Task Force recommended that the NYRA top racing official, the horse’s trainer and attending veterinarian, as well as others be part of the review.  Importantly, the Task Force recommended that the  “report of the review board proceedings should be made part of the [Gaming Commission] investigative report.”

But Genaro found that those recommendations have been watered-down.  The top NYRA racing official, Martin Panza, does not attend the meetings.  In addition, there are no reports generated.  In true government fashion, Panza shifted the blame, saying that a report would have to come from Dr. Palmer of the Gaming Commission, even though the panel is a NYRA responsibility.

But the failure to implement either the letter or the spirit of the Task Report from 2012 does not end there.  In a response to the series of recent breakdowns, the NYRA Communications Department issued a list of what NYRA has done recently to address fatalities.  One of those innovations is that all fatal breakdowns, both racing and training, would be sent to Cornell for a necropsy.  This was recommended by the Task Force Report of September, 2012.  But it was also something NYRA stated it was doing in the summer of 2013.  Apparently, this is yet another important safety recommendation that has fallen through the ever-widening cracks at NYRA.

Given the effort that went into the 2012 Task Force Report by four of the industry’s most respected figures  –  Dr. Palmer, Dr. Mary Scollay from Kentucky, Alan Foreman and Jerry Bailey  –  any serious inquiry into what is happening at Aqueduct should measure the state’s performance against what was recommended.  Instead, NYRA has come up with steps to address the crisis, several of which seem to be of questionable utility.

One is to not allow a horse to race if it has raced in the past 14 days.  Of the 12 recent fatalities, four had a race within the preceding 14 days which might make this seem to be a sensible step.  (Three of the four also had poor finishes in the last race, finishing more than 20 lengths behind the winner.)  But many well-regarded trainers will bring a horse back in a shorter period of time, and I have never observed any relationship between a quick turnaround and a breakdown.  If anything, trainers who do that as a matter of course have a good record with it.

Another is to reduce the number of races.  Again, I am not aware of any causal relationship between the number of races on a card and breakdowns.  But this is something NYRA wants to do anyhow  –  this is the second time the current leadership has proposed this with the stated purpose of safety  –  and I am skeptical when a purported safety rationale comports with what they want to do for other reasons.

If NYRA explained their rationale with supporting data, it would be one thing.  But this smacks of nothing more than a PR fig leaf to get past a crisis.  There are, however, meaningful steps they could take to address this problem, although none of them would provide the short-term jolt that an ill-conceived press release provides.

The most important thing NYRA and the Gaming Commission can do is a serious audit of which Task Force recommendations have been implemented fully, and which have been altered  –  with an explanation for any changes.  If they are fully compliant  –  which obviously appears to not be the case  –  then there is a problem of a different magnitude.  Needless to say, this report should be made public, as was the Task Force Report itself.

One area in particular deserves serious scrutiny.  The Task Force Report detailed practices by the NYRA vets when conducting their pre-race exams that were disturbing, if not shocking.  What has NYRA done to implement the Task Force recommendations in this one area?  Since this is the most proximate exam by a vet before a race, it is of special importance.  If the Task Force Report recommendations are not being followed in this instance, it could provide an answer to the current crisis.

Interestingly, this is not the first time the Cuomo-controlled Board of Directors has faced what seemed to be a troubling increase in inner track fatalities.  That time, back in 2013, Board Chairman David Skorton seemed to panic, coming up with a series of possible steps, including stopping winter racing.  When the situation calmed down, so did Skorton.

But if NYRA and the Gaming Commission do not get on top of this issue, the next crisis will arrive and they will have nothing but PR stunts to address it.  It would be far better if they took the basic management step of measuring what they are doing against the thoughtful recommendations by the 2012 Task Force.

Aqueduct racing deaths are not the whole story

Posted by noonante on January 21, 2015
Posted in: Horse Racing, Political/Social commentary, Politics. Tagged: , , , , , , , , . 1 Comment

Recent news accounts have focused on the dramatic increase in fatalities occurring in races on the Aqueduct inner track.  The 12th catastrophic injury since early December occurred on Friday.  It seems to be a sharp reversal from the progress made by the New York Racing Association since a similar increase in the 2011-12 meet.  Yet that progress has not been replicated in reducing the fatalities that occur during training hours.  Just as troubling, however, is that recommendations by a special Task Force following a spike in racing fatalities in 2011-12 are not being followed.

I studied the record of all fatalities from the web site of New York’s Gaming Commission for the same three-month period, September through November, for each of the last four years.  Racing fatalities had dropped significantly, from a high of 13 in 2011 to a low of six in 2013 and then eight in 2014.  Conversely, training fatalities had increased from a low of six in 2011 to a high of 14 in 2013 before dropping to 10 in 2014.  When the number of racing and training fatalities are totaled, there has been almost no change.  We went from 19 in 2011 to 18 in 2014, with the intervening years being 16 and 20.

The inverse relationship between racing and training fatalities is curious.  It is further amplified when one considers that the high number of racing fatalities in 2011-12 and 2014-15 was matched in each instance by almost no training deaths on the inner track.  In this current period, there has been one fatality in the morning (but three at Belmont).  When a task force in 2012 looked at that meet’s 21 racing fatalities, it found no training fatalities at Aqueduct (but there were seven at Belmont).

Dr. Scott Palmer, New York’s Equine Medical Director, is aware of the disparity between New York’s overall success in reducing racing fatalities in contrast to the lack of success in cutting the numbers from morning training.  I asked him about this last summer, and he identified the factors that made identifying at-risk horses during training so much more difficult than for those racing.

Each horse who is entered to race is examined in the morning by a NYRA veterinarian to determine if the horse is sound, or has a condition that warrants the vet scratching the horse.  The vet should also equipped with records pertaining to the horse that might cause a red flag.  Horses in training, however, do not receive any scrutiny by NYRA’s vets.  While NYRA has on-track personnel to look for problems, including a new position of “Safety Steward,” it is close to being an impossible task to catch every potential problem.  Dr. Palmer did say that he continues to work on possible solutions to the training track fatalities.   NYRA did not respond to my request for comments on training breakdowns.

The spike in Aqueduct’s racing fatalities must be doubly embarrassing for NYRA.  The fatalities in 2011-12 were one of the factors supposedly used by Governor Andrew Cuomo to seize control of NYRA and replace it with a Board of Directors consisting mostly of state appointees.  And last week, the Kentucky Horse Racing Commission announced that it had experienced 12 racing fatalities for all tracks for the entire year.

Catastrophic breakdowns are a difficult issue with many possible causes.  All one has to do is look at a thoroughbred’s legs to realize that an awful lot of weight is being supported by those legs travelling at high speeds.  New York investigated the causes that led to the 2011-12 Aqueduct fatalities by appointing a blue-ribbon Task Force that issued a comprehensive report identifying several possible causes.  The Task Force also made over 100 recommendations that could serve as a bible for any racing jurisdiction seeking to reduce fatalities.

Unfortunately, it is not clear how committed New York has been to implementing the recommendations of its own task force.  Teresa Genaro, writing in Brooklyn Backstretch, has recently written about two shortcomings.

One has to do with the state’s monitoring of compliance with rules and protocols concerning the administration of corticosteroids.  Corticosteroids is a class of therapeutic medications used to treat a broad range of medical conditions (according to the Task Force Report).  It can also, however, have a side effect of masking unsoundness if administered too close to a vet examining the horse.  Repeated administration can also have serious long-term consequences.  The Task Force Report identified it as a potential factor in several of the horses suffering catastrophic injuries during the 2011-12 meet.

Even though treating a horse with intra-articular corticosteroids required a report to the state’s regulatory agency (now the Gaming Commission), the Task Force concluded that the agency neglected to monitor compliance with the regulation, describing it as a “serious deficiency.”  The Task Force recommended that the existing rule be enforced, and that a trainer who claimed a horse should be provided with the record of all IA corticosteroids within 48 hours by the prior trainer.  This last requirement is particularly important given the potentially harmful effects of over-administering the drug.

Nonetheless, monitoring of these requirements by the Gaming Commission has been deficient, according to Genaro.  While the Commission did conduct an audit in 2013, they do not appear to be aware of the extent of compliance with the reporting requirement.  Just as troubling, the transfer of records from one trainer to the claiming trainer appears to be close to non-existent.

According to the Genaro piece, the Gaming Commission spokesperson said that while 600 horses were claimed in 2013, he did not receive a single request for records.  Trainers are understandably reluctant to pursue the issue with a trainer they just claimed from.  The Gaming Commission has developed a software program that will enable the Gaming Commission to notify the claiming trainer of corticosteroid injections reported on the ESAL, a Commission database, and that it should be running in a few weeks.

A second troubling shortcoming identified by Genaro is the manner in which the state has implemented a panel charged with examining the cause of any exercise-related fatality that occurs on a NYRA track.  The Task Force recommended that the NYRA top racing official, the horse’s trainer and attending veterinarian, as well as others be part of the review.  Importantly, the Task Force recommended that the  “report of the review board proceedings should be made part of the [Gaming Commission] investigative report.”

But Genaro found that those recommendations have been substantially watered-down.  The top NYRA racing official, Martin Panza, does not attend the meetings.  [NOTE:  The following has been deleted from the original post because it is not an accurate restatement of Genaro’s article, which can be read in its entirety from the link.}  Many trainers do not attend, according to Genaro, because Rick Violette, representing the New York Thoroughbred Horsemen’s Association, is a competing trainer.  While she does not mention if the attending veterinarian attends, I suspect that if the trainer is not going, neither is the vet.  If all this is not bad enough,  In addition, there are no reports generated.  In true government fashion, Panza shifted the blame, saying that a report would have to come from Dr. Palmer of the Gaming Commission, even though the panel is a NYRA responsibility.

But the failure to implement either the letter or the spirit of the Task Report from 2012 does not end there.  In a response to the series of recent breakdowns, the NYRA Communications Department issued a list of what NYRA has done recently to address fatalities.  One of those innovations is that all fatal breakdowns, both racing and training, would be sent to Cornell for a necropsy.  This was recommended by the Task Force Report of September, 2012.  But it was also something NYRA stated it was doing in the summer of 2013.  Apparently, this is yet another important safety recommendation that has fallen through the ever-widening cracks at NYRA.

Given the effort that went into the 2012 Task Force Report by four of the industry’s most respected figures  –  Dr. Palmer, Dr. Mary Scollay from Kentucky, Alan Foreman and Jerry Bailey  –  any serious inquiry into what is happening at Aqueduct should measure the state’s performance against what was recommended.  Instead, NYRA has come up with steps to address the crisis, several of which seem to be of questionable utility.

One is to not allow a horse to race if it has raced in the past 14 days.  Of the 12 recent fatalities, four had a race within the preceding 14 days which might make this seem to be a sensible step.  (Three of the four also had poor finishes in the last race, finishing more than 20 lengths behind the winner.)  But many well-regarded trainers will bring a horse back in a shorter period of time, and I have never observed any relationship between a quick turnaround and a breakdown.  If anything, trainers who do that as a matter of course have a good record with it.

Another is to reduce the number of races.  Again, I am not aware of any causal relationship between the number of races on a card and breakdowns.  But this is something NYRA wants to do anyhow  –  this is the second time the current leadership has proposed this with the stated purpose of safety  –  and I am skeptical when a purported safety rationale comports with what they want to do for other reasons.

If NYRA explained their rationale with supporting data, it would be one thing.  But this smacks of nothing more than a PR fig leaf to get past a crisis.  There are, however, meaningful steps they could take to address this problem, although none of them would provide the short-term jolt that an ill-conceived press release provides.

The most important thing NYRA and the Gaming Commission can do is a serious audit of which Task Force recommendations have been implemented fully, and which have been altered  –  with an explanation for any changes.  If they are fully compliant  –  which obviously appears to not be the case  –  then there is a problem of a different magnitude.  Needless to say, this report should be made public, as was the Task Force Report itself.

One area in particular deserves serious scrutiny.  The Task Force Report detailed practices by the NYRA vets when conducting their pre-race exams that were disturbing, if not shocking.  What has NYRA done to implement the Task Force recommendations in this one area?  Since this is the most proximate exam by a vet before a race, it is of special importance.  If the Task Force Report recommendations are not being followed in this instance, it could provide an answer to the current crisis.

Interestingly, this is not the first time the Cuomo-controlled Board of Directors has faced what seemed to be a troubling increase in inner track fatalities.  That time, back in 2013, Board Chairman David Skorton seemed to panic, coming up with a series of possible steps, including stopping winter racing.  When the situation calmed down, so did Skorton.

But if NYRA and the Gaming Commission do not get on top of this issue, the next crisis will arrive and they will have nothing but PR stunts to address it.  It would be far better if they took the basic management step of measuring what they are doing against the thoughtful recommendations by the 2012 Task Force.

Isn’t it time to address Saratoga’s equine fatalities?

Posted by noonante on August 26, 2014
Posted in: Horse Racing, Saratoga thoughts. Tagged: , , , . 5 Comments

The five-day period beginning the Thursday before the Travers has seen five fatalities during racing or training at Saratoga.  Overall, racing fatalities exceed the total for last year’s meet by two, with seven occurring so far, and there’s a week of racing to go.  There have also been four training fatalities (and two more at Belmont) compared with two during the entirety of last year’s meet.

The New York Racing Association has taken several major steps to lessen the occurrence of equine deaths.  What they are not particularly good at, however, is communicating what they are doing, what has been effective and what has not been.

Dr. Scott Palmer, who headed up the landmark 2012 Report on Equine Safety, is now the Equine Medical Director for New York’s Gaming Commission.  One of the improvements recommended by the Report is conducting necropsies on all catastrophically injured horses.  What is not known  –  publicly, however  –  is what, if any, conclusions have been reached from the post-mortem reviews.

The most recent fatality happened during Monday’s first race.  I saw the fall on TV, but fortunately missed the aftermath of the horse suffering on the track following what was said to be a broken neck.  I then heard accounts of two people who were making their first visit to a race track.  Needless to say, the experience was unsettling, with one couple leaving immediately.  Another long-time fan and owner told me that seeing catastrophic breakdowns was causing her to think about never returning.

If NYRA and the Gaming Commission would be more forthcoming on what they have learned from studying catastrophic injuries it would neither lessen the trauma from watching a fatality, nor the horrible experience of those connected with the horse, from the owner to stable hands.  It would, however, provide a measure of comfort to those who love the sport that New York is as concerned with these incidents as they are.

NYRA backtracks on safety – UPDATE

Posted by noonante on November 15, 2013
Posted in: Horse Racing, Political/Social commentary. Tagged: , , , . Leave a comment

Earlier this week I wrote that NYRA’s President and Chief Executive Officer had reversed a significant reform implemented after the Report of the Task Force on Racehorse Health and Safety was released over a year ago.  The Task Force recommended that NYRA’s veterinarians should report to a separate state agency  –  the Gaming Commission  – or, if that was not feasible, to the stewards.  The panel had identified the NYRA practice of the vets reporting to the Racing Office as a “critical conflict of interest” that “must be changed immediately.”  The conflict arose from the differing objectives of the Veterinary Department and the Racing Office.  The former was responsible for ensuring the safety of horses entered to race so that only sound horses are allowed to run.  The Racing Office, by contrast, had a major focus of providing large fields for bettors, because large fields meant an increase in the wagering handle  –  and more revenue for NYRA.

In October, 2012, NYRA had changed the reporting relationship so that the Veterinary Department would report to the stewards.  CEO Christopher Kay had decided to change this relationship when the new Senior Vice-President of Racing started later this month, with the vets once again reporting to the racing operation, thereby reviving the “unacceptable conflict of interest” identified by the Task Force.

NYRA’s spokesperson has informed me that NYRA will not change the reporting relationship, so that the veterinarians will continue to report to the stewards, and “will not report to the incoming Senior VP for any purpose.”

New NYRA – where’s it at?

Posted by noonante on November 4, 2013
Posted in: Horse Racing, Political/Social commentary, Politics. Tagged: , , , , , , , , . 1 Comment

It’s been more than a year since the NYRA Reorganization Board was established.  Since the law written by Governor Andrew Cuomo calls for it to disappear three years after its creation, this is a time to look at what difference it has made to New York’s racing.

The “new” NYRA was deemed necessary by the Governor, who browbeat the former NYRA Board and a somnolent Legislature in May of 2012 to give him control of New York’s racing, despite the Governor’s admission that he did “not know this industry especially well.”  He waited four months before signing the law, and did not appoint his Board members until October 18.  The purported reason for the dramatic step of state government taking over the industry was a supposedly “scandalous” prior NYRA that had failed to make a one percent reduction in takeout in some exotic wagers.  (Never mind that the promised review by the Inspector General has never materialized, nor that Cuomo’s new Board concluded there was no intentional misconduct by the prior NYRA’s leadership.)

Cuomo named David Skorton, President of Cornell University, as Chairman of the new Board and made seven additional appointments to go along with four appointments by the legislative leadership and five appointments by the old NYRA.  Skorton, who has no experience with horse racing, was praised at the time because he once stayed in a Cornell dorm room.  Skorton viewed the problem with the prior NYRA as resulting from a lack of “leadership and management,” and promised to run a transparent and accountable organization.

So, what has he accomplished?  Answering that question is somewhat difficult since, despite the promise of transparency, the “new” NYRA has been anything but.  We are left with what has been discussed at the public meetings of the Reorganization Board.

Chairman Skorton’s first priority was to focus on the safety of the participants in New York’s races.  A Task Force that was appointed and made a comprehensive report prior to Skorton’s arrival on the scene, had recommended a number of changes to how NYRA and the state conduct racing.  Some of the significant changes proposed in the Report were made by a separate state agency, the Gaming Commission that has the authority to issue regulations.  They made changes in rules governing the administration of some medications, as well as modifications to claiming rules.  For its part, NYRA appointed a committee to review safety policies, another committee to investigate racing fatalities, and have started conducting necropsies of catastrophically injured horses.

Of the Task Force’s 39 main recommendations and 93 subordinate proposals  –  a number of which required action by the Gaming Commission  –  how many did NYRA implement?  We do not know because NYRA has refused to provide any information regarding their action or inaction.

At one point this year, it appeared that the Gaming Commission regulations and NYRA’s focus on safety may have produced results.  Following some earlier fatalities at Aqueduct, there was a marked decrease in catastrophic breakdowns at the spring meetings.  Unfortunately, that trend stopped during the Saratoga meet, and while Belmont fall meeting fatalities are down from six in 2012 to four this year, it has not mirrored what appeared to be a significant success.  The cause of fatal breakdown is a complex one with many contributing factors, but NYRA’s failure to divulge information as to what they have done does not benefit horses, riders or the industry.

Another priority became the hiring of a new Chief Executive Officer.  While Administration sources reportedly said there would be a “nationwide search” commencing in October and that there had already been considerable interest expressed by experienced racing executives, the new Board did not begin the search until the end of February.  They ended up hiring unemployed business executive Christopher Kay who, unlike his boss, had actually been to a horse race  –  albeit 40 years ago.  As an indication of the Governor’s interest in the industry he now controls, as well as the juice Kay will possess when it comes to making decisions affecting New York racing, Cuomo did not even meet with Kay prior to his being hired.  Although Kay signed a $550,000 contract, apparently it did not call for him to be ready as CEO on day 1.  The Times Union has reported that NYRA also paid a consultant $75,000 to “mentor” him.

The issue that prompted the most discussion at the Board was a proposed contract for an Advance Deposit Wagering platform.  The Gaming Commission’s Acting Director Rob Williams, supported by Cuomo’s Budget Director and Board member Robert Megna, had expressed reservations about the process used to select the winning bidder.  Since the contract was expected to bring in between $3 and $5 million each quarter (starting with the one we are in), it was not an insignificant matter for NYRA to get right.  This is particularly important because of the insistence by Williams and Megna of NYRA becoming self-sufficient without relying on  the VLT revenues from the racino at Aqueduct.  While I agree that the procurement process was fatally flawed, neither Williams nor Megna did much to bring the matter to resolution, even though it could have been resolved with a phone call to Skorton.  Despite the hectoring on VLT revenues, the two Cuomo employees allowed the process to drag on for months.  While Chairman Skorton  –  the “leadership and management” advocate  –  said he would work the matter out in April, he did nothing and the full Board ended up withdrawing the procurement at its June 18 meeting.  So in the six months after then-CEO Ellen McClain identified this as a problem, the Board sat on its hands, and a technology that was expected to start a month ago has been delayed while a new procurement is conducted. 

So that is one person’s assessment of what the new NYRA has “accomplished” in its first year of operation.  Although it is a 17-member Board with several “Special Advisors,”  David Skorton is clearly in charge.  If you follow the activities of the Cuomo Administration, you are not going to see much independent behavior, and this Board does not disappoint in that regard.  In all of the Board meetings, there has only been one vote that has not been unanimous  –  the decision to withdraw the ADW contract.  The “discussion” at the meeting to select the CEO lasted all of eight minutes.

In addition, Skorton’s promise of transparency has been as hollow as that of the Governor’s frequent invocation of that phrase while doing the exact opposite.  (The law establishing the new NYRA was laughingly entitled “New York state racing franchise accountability and transparency act of 2012.”)  NYRA consistently refuses to release documents that are clearly public ones  –  a prime example being Kay’s $550,000 contract and performance goals.  Skorton said all decision-making meetings of NYRA would be public, but only one committee  –  Equine Safety  – has regularly conducted its business in the open.

These are not esoteric matters.  NYRA has three significant decisions on its plate that could have a profound and long-lasting impact on New York racing and the tens of thousands of jobs dependent on it.

The first is whether NYRA should start to operate as if there are no VLT revenues.  Skorton tried to sneak this through in the last minutes of the August meeting of the Board.  In a rare show of independence, there was sufficient backlash for the Chairman to back down.  The VLT revenue is important because a racing operation that has operated at a loss without the revenue operates profitably with them.  The VLT revenues, incidentally, come from the profits of the casino operator, not “state subsidies” as Cuomo Administration figures continually say.

The Board must also come up with a plan to “reprivatize” NYRA.  The law creating the new Board calls for a report on this to be made by April 2015  –  less than 18 months from now.  There have been leaked stories from Cuomo’s Administration raising possibilities ranging from Santa Anita (sic) to Madison Square Garden (double sic) as potential franchise holders.

The third big issue comes to us courtesy of The New York Daily News.  The Governor has apparently decided that Aqueduct is a “waste”  –  which to the Governor’s mind means property that could be transferred to real estate developers.  Robert Megna, who attended the meeting with the editorial board, stated that Skorton and Kay are studying the possibility of closing Aqueduct “very closely.”

So, there you have it.  As a frequent examiner of past performances, when the Governor says something, the only response one can expect from his appointees is “Yes, Sir!”  We thus have the uncomfortable scenario in which three people who know nothing about racing or the breeding industry are on a path to make decisions profoundly affecting both.  And, it is clear they intend to make those decisions in secret to the extent they can get away with it.  Skorton already said as much at the August Board meeting on the subject of the VLT revenues.

It is not as though there are not plenty of talented people with a wealth of knowledge and experience who deserve to be part of these discussions.  They can be found on back stretches, farms, industry organizations or working for NYRA.  Each of these issues is significant and complex and would benefit for a full and open airing.  They don’t lend themselves to the sound bites of a Governor’s reelection campaign.

Random thoughts from The Week That Was in racing

Posted by noonante on October 7, 2013
Posted in: Horse Racing, Saratoga thoughts. Tagged: , , , . Leave a comment

With one exception, I’ll leave the commentary on this weekend’s BC preps to the analysis on Capital OTB’s always entertaining morning programs and to DRF and the Blood Horse.  The exception is the Arc.  That is one impressive three-year old filly.  While there is regular commentary on the difference between European and American racing  –  usually centered around either the “breed for speed” of the States or on drug policies  –  why is it not unusual for one of the European girls to beat up on the boys (in an 18-horse field no less)?  It may be the 11-pound weight advantage they get because of age and gender.

Here are some other observations from this week’s news:

  • Travers complaint of cheating was baseless:

Six days after Moreno was run down in the stretch by Will Take Charge, the trainer of the second-place horse filed a complaint with New York authorities that the winning jockey had used an electrical device (or “battery”) to stimulate his mount.  According to trainer Eric Guillot, over 100 people had witnessed his video and came to the same conclusion that the jockey had something in his hand other than his whip or the reins, and hid it after the race.  When I looked at the race video following news of Guillot’s complaint, it was clear that if you wanted to see something in the jock’s hand that did not belong there, you could so conclude.  But based on prior allegations of jockey misconduct based on video footage, one should be careful before drawing any conclusions.

New York’s Gaming Commission, the agency with investigatory and regulatory responsibility for racing, assisted by the forensic unit of the State Police, conducted a thorough review and concluded the jockey “was not carrying any sort of  electrical device and that Mr. Guillot’s allegation was wholly unsubstantiated.”  In the Gaming Commission report released last week, there were four salient points:

  1. The State Police reviewed 7,000 frames from NBC’s broadcast as well as photos from a professional photographer who was covering the race;
  2. The video that was the basis of Guillot’s complaint was the result of using a mobile device to record from a DVR recording;
  3. The quality of that video was impaired because of “compression artifacts,” or a reduction in the amount of data that could be recorded because of the quality of the devices used to make the video;
  4. The photographs by the professional taking shots in the race aftermath show nothing inappropriate in the jockey’s hands.

I think the photographs included in the Gaming Commission report  –  particularly Figures 6 – 18  –  are the most compelling exculpatory pieces of evidence.  They are all the more significant because there simply is no incriminating evidence.  The Commission’s report can be read here.

Guillot’s complaint was troubling because someone who earns his livelihood from an enterprise has a responsibility to not drag the profession through the mud unnecessarily.  That is not to say he should not have filed the complaint with the authorities, but rather that he should not have gone around broadcasting it in a way that would draw the inevitable attention.  The sport does not need more unwarranted negative publicity.  Guillot simply fanned the flames of those would want to believe the worst about the game, and many of those people will have conveniently forgotten the clearing of the jockey the next time there is a discussion about integrity.  The Gaming Commission is to be commended for having completed its review in about a month with a thorough and professional effort.

  • Racing is in trouble if this is its company.

This September Atlantic did a short piece on the success of ESPN.  In describing how the network rose from its doldrums to become a dominant figure in TV ratings, the magazine quoted an executive:

We had strayed to food eating and gaming and salsa and horse racing and figure skating, and it just didn’t perform for us.  I had this quadrant with two axes:  young versus old, and male versus dual audience.

Yikes!  Food eating and salsa?  I assume by “dual audience” he means one that includes women.  It will be interesting what ESPN’s aspiring competitor, Fox Sports 1,  will do to attract younger viewers and women, given that they have stated that racing will be a significant part of its broadcast package,.  I don’t know how their one announced star, Regis Philbin, fits into that equation.

Where is New York’s Gaming Commission?

Posted by noonante on April 8, 2013
Posted in: Horse Racing, Political/Social commentary, Politics. Tagged: , , , . 2 Comments

As part of Governor Andrew Cuomo’s effort to streamline state government and make it more efficient, the Legislature established the State Gaming Commission.  The separate state agencies that regulated gaming activities, including the Lottery and the Racing and Wagering Board, were brought under a seven-member Commission that would bolster New York’s role in an “increasingly competitive market place,” and ensure public confidence that the state’s gaming would be of the “highest integrity, credibility and quality.”  The law was passed more than a year ago.

The Gaming Commission was to begin operations on October 1, 2012, but the legislation under which New York State took control of the New York Racing Association delayed the effective date for four months.  The Racing and Wagering Board ceased operations on January 31 with its powers and responsibilities transferred to the new entity.  There is only one problem.  While the Commission has a shiny new web site, there is no commission.  The Governor controls five of the seven appointments with the Senate and Assembly getting one each.  Early news reports identified two individuals who were to be selected, but the web site identifies “TBD” for each of the seven members.  When we turn to the page for the Commission’s staff, it is blank.  We know there is an Acting Executive Director since he issued a press release this week, but that is all that is publicly known about an organization that was to bring Cuomo’s much-heralded, but rarely delivered, “transparency” to gambling activity regulated by the state.

Why is this important?  For starters, it is the only body that has the ability to regulate what goes on in horse racing.  The late Racing and Wagering Board closed out its tenure with changes governing the administration of drugs, as well as additional changes permitting the voiding of a claim if a horse was vanned from the track.  These amendments were the result of a Task Force’s report analyzing a number of fatal injuries sustained at last year’s Aqueduct winter meet.  It is not unusual that regulations have to be tweaked  –  indeed, the Racing and Wagering Board had to do it with some of these  –  but that ability is lost when there isn’t an entity with the authority to do it.

Second, the Governor’s failure to act further exacerbates the absence of any leadership in New York’s racing industry.  The President of the New York Racing Association has been fired, the Chair of the NYRA Board is still learning the business, and now a key oversight body doesn’t exist.  Thus, we have the silliness of “enhanced” security and drug testing for Saturday’s Wood Memorial at Aqueduct, a major prep race each year for the Kentucky Derby.  According to the Cuomo Administration’s view of horse racing, only three races of the thousands run in New York each year deserve this heightened scrutiny:  the Wood, Belmont Stakes and Travers.  This sends the message that illegal drugging is a significant problem with racing, but these three events are the only ones worthy of added protection.  While I am sure there must have been drug disqualifications in America’s Grade I races over the years, the only one that comes to mind is Dancer’s Image in the 1968 Kentucky Derby.  Even though Santa Anita implemented a similar protocol for the Santa Anita Derby, these special security precautions are clearly nothing more than publicity stunts.

The joint NYRA-Gaming Commission announcement, however, may also have served another interest.  A nascent controversy involving both track security and illegal drugging was reported by David Grening  in The Daily Racing Form.   Trainer Rudy Rodriguez was recently suspended by the stewards for two drug positives, a sanction he did not challenge.  Rodriguez, coincidentally the trainer of Vyjack, the Wood’s second betting choice and 3rd place finisher, has been one of the most successful trainers on the New York circuit, but has also been the subject of many rumors and whispers about his possible use of illegal medications.  The recent suspension was his second as a trainer, and the first since 2011.  But on March 10, another Rodriguez horse tested positive.

What made the latest positive remarkable is that Rodriguez’ attorney claimed, as Grening reports, that NYRA’s failure to respond to Rodriguez’ February request for a security camera in a second barn shared with another trainer may have allowed tampering with his horses.  That an unusually high level of banamine, a commonly used anti-inflammatory, appeared in the post-race test is, according to the attorney, strong evidence of tampering, indicating that Rodriguez may have been set up.  Two owners who have horses with Rodriguez have offered a $40,000 reward for information on the tampering accusation.  So, while the purported leadership of state officials responsible for what has been the country’s best racing flails around looking for the next meaningless press release, here is a real potential threat to the integrity of the sport.

If that isn’t a sufficient reason for the Governor to appoint the State Gaming Commission, we have the matter of bringing casinos to New York.  Cuomo identified this as one of his major priorities in the 2012 State of the State, and the Legislature voted in favor of amending the state’s Constitution to permit up to seven sites.  A second affirmative vote by the Legislature, as well as voter approval in a referendum, is necessary for the amendment to take effect.  While a subsequent approval by the Legislature would seem to be a mere formality, the Governor has decided to alter his original proposal.  He now wants the location of casino sites to be chosen by the Gaming Commission, a body on which he will controls five of the seven seats when he gets around to appointing them.  Although the often somnolent Legislature regularly acquiesces to the Governor’s whims, this time they think they should have a say in the siting process, and perhaps even allow the voters of a proposed locale to have a vote.  Cuomo has further muddied the waters by saying New York City should not have one, but Buffalo should.  He may be thinking that if he appoints the Commission, he will have prematurely played his hand, thereby weakening his leverage with the Legislature.

In short, we do not know what is behind the Governor’s failure to appoint any members of an important regulatory body for more than a year after it was established.  One fear is that he has simply lost interest.  Another is that he doesn’t care about racing or casinos except to the extent either can improve the state’s bottom line.  What we do know, however, is that there is not a good reason for his inaction.  Last week’s federal indictments of a state senator and assemblyman gave the Governor the opportunity to express his outrage at a political environment that allows corruption.  Perhaps he should consider the atmosphere he is fostering by failing to make the types of appointments that would help prevent the incompetence and corruption so vividly displayed last week.  Certainly, New York’s horse racing could use some leadership.