Winnipeg Free Press - PRINT EDITION

Downs owner looks for lifeline

Club asks court to maintain funding

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The Manitoba Jockey Club is convinced the Selinger government is working with Red River Exhibition Inc. to bankrupt the horse-racing track operator and turn the track and its 52.6 hectares over to the Ex.

The jockey club, a non-profit group that owns and operates Assiniboia Downs, has gone to court to fight for its survival.

In documents filed in Court of Queen's Bench, the jockey club alleges the provincial government has decided to use a variety of illegal and improper means to cut funding to the track by more than 50 per cent in an effort to force the club to turn it over to the Red River Exhibition.

The jockey club said its proof is in a letter dated Jan. 30 that Finance Minister Stan Struthers sent the club, confirming details of the Red River Ex plan first reported that day in the Free Press.

"The contents of the (Struthers) letter confirmed that the plan adopted by Minister Struthers was designed to... (undermine) the (jockey club's) long-term financial stability," states the club's document filed in court.

The jockey club states that in two subsequent meetings with Struthers, on Jan. 31 and Feb. 28, he told the club its funding would be cut and it would be best if the Ex took over the track.

The jockey club has applied to the court for an interim ruling that would maintain funding agreements the club has with the province and the Manitoba Lotteries Corp., which provide the club with $9.5 million annually, until new arrangements can be finalized.

The allegations have not been proven in court.

The jockey club has owned and operated Assiniboia Downs since 1993. It owns the track and surrounding 130 acres, located adjacent to the Red River Ex property on the western edge of Winnipeg.

The province announced at the end of January it's considering a proposal for the Ex to take over the racetrack and surrounding land in exchange for a $5-million reduction in funding for the track's operation. It's believed the province intends to reduce the funding through cuts in the club's VLT revenue and parimutuel betting.

In an affidavit included in the jockey club's application, club CEO Darren Dunn states it appears Struthers and other members of the provincial government are working secretly to have the Ex take over the jockey club property at no cost.

"What has transpired has every appearance of decisions being made behind the scenes and out of the light of public transparency... designed to put (the jockey club) in the worst possible position financially," Dunn states in the court documents. "(Struthers') sole purpose seemed to be to assist (the Red River Ex) in acquiring a $70-million real estate asset without any compensation being paid."

An appearance in the uncontested-motions court Thursday was adjourned to Tuesday, when a government lawyer is to challenge the jockey club's application.

A spokesman for the province said it would not comment on the jockey club's legal action, but confirmed the government has told the club it intends to proceed with plans to cut an unspecified amount of funding.

The jockey club documents state the province cannot cut the club's VLT revenue, saying that source of funds is negotiated between the club and the Manitoba Lotteries Corp., an independent, arm's-length government agency.

The jockey club claims revenues from track betting are also guaranteed to the club through legislation that sets out steps that must be taken to change the funding formula -- steps the province has not taken.

Jockey club lawyer Jeff Rath told the court Thursday a ruling is urgent because the club fears it will be in serious financial difficulty once the budget details are announced April 16. The club wants a court ruling before that date.

"The Manitoba Jockey Club believes it is important that the legislature have the opinion of the Court of Queen's Bench in regards to the legality of budget measures that they are being asked to vote upon as an extremely pressing and urgent matter in the protection of the public interest," Rath told the court Thursday morning.

He said the jockey club would not comment on the legal action.

A source close to the jockey club said it only resorted to legal action because the government has repeatedly refused to meet with the club to consider its own plans to ensure the long-term financial security of the track.

aldo.santin@freepress.mb.ca

Republished from the Winnipeg Free Press print edition March 30, 2013 A4

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