Hey there, time traveller! This article was published 24/4/2015 (2339 days ago), so information in it may no longer be current.
Assiniboia Downs may have won its most recent — and high-profile — battle with the provincial NDP government, but the thoroughbred racetrack remains locked in a fight with the province.
Executives with the Manitoba Jockey Club, the non-profit group that owns the track, have demanded the province remove the chairman and vice-chairman of the Manitoba Horse Racing Commission, accusing the two men of using the powers of their office to make track operations too difficult and too expensive. The horse racing industry provides work for more than 400 people and funnels about $40 million annually into the economy.
It’s the first time in the 57-year history of the Portage Avenue facility that the track’s ownership has demanded its regulator be fired and it is doing so with the full support of thoroughbred owners and trainers, who have drafted a petition in support of the MJC position that calls for the removal from office of MHRC chairman Tom Goodman and vice-chairman Brian Billeck.
"The Manitoba Horse Racing Commission has gravely damaged the horse racing industry in this province by their actions while in office. They do not represent our interests and the best interests of this industry and must be replaced immediately," reads the draft petition written by the executive of the local chapter of the Horsemen’s Benevolent and Protective Association, which represents the track’s 600 owners and trainers.
It doesn’t appear as if that’s going to happen. A spokesman for the province last week issued a terse response to a lengthy list of questions — including whether the province continues to support Goodman and Billeck — submitted by the Free Press. "The Horse Racing Commission is an independent body. We do not interfere in the decisions made by the commission," Caedmon Molowany, a spokesman for Agriculture Minister Ron Kostyshyn, wrote in an email April 15.
The Free Press made multiple attempts to get comment from Goodman and Billeck through Larry Huber, the executive director of the MHRC. Huber said he forwarded interview requests to both men — which included questions also asked of the province — but neither responded.
The MHRC is a provincially appointed regulatory body that oversees all aspects of the horse racing industry in Manitoba. The chairman and vice-chairman have no fixed term and can be removed by the government at any time.
MJC officials insist that time should be right now. "The board felt the need to reach out to the province as a last resort as the working relationship with the MHRC has been poor," said Downs CEO Darren Dunn.
"We offer suggestions, ask questions for clarity on issues and receive little to no response in many cases. We feel our opinion and extensive operational experience is largely ignored. With the negative impact on revenues and stability, we believe, based on some of their decisions, our board felt they had a responsibility to act."
There is little the MJC can do if the province refuses its demand.
Formed in 1965, the MHRC is a powerful body that oversees the running of race tracks in Manitoba though, unlike other racing commissions in North America, its mandate does not include promoting the industry.
Because horse racing was for decades the only form of legal gambling in Manitoba, there were once serious fears of mob influence and corruption in the industry, reflected in the MHRC’s powers.
Some of those powers can seem almost draconian today: the commission has warrantless search-and-seizure powers over the property and persons of just about anyone connected to the Downs and live racing.
Its relationship with the Downs for much of the last 50 years has been mostly co-operative, with the MHRC acting as a regulator and mediator of disputes, while leaving much of the day-to-day operations to Downs ownership.
Until now, that is.
The province appointed a representative to meet with the Downs this month and the MJC handed the province a stack of documents outlining its problems with the MHRC.
As of Friday, the MJC had still received no response from the province.
The MJC has myriad issues with decisions and orders that the MHRC has handed down since the Downs went to war with the province in 2013 over the NDP government’s decision to strip the track of its VLTs, a move the Downs said would have effectively put the track into bankruptcy.
While the Downs won that battle — the province ultimately capitulated in the face of an onslaught of lawsuits filed by the MJC and handed the track a new 12-year VLT deal — the track’s management says the MHRC has been using the powers of the commission ever since to hand down orders Downs management says are unnecessary and making it tough to do business.
Here’s a partial summary of their concerns:
❚ The MHRC abruptly commissioned a structural engineer last fall to do an inspection of the track’s barn area to determine "if there are any significant areas where the buildings may require upgrading to meet safe operational condition."
The firm — Accutech Engineering — reported on Oct. 27, 2014 with a 60-page report outlining what it claimed to be deficiencies and safety hazards on the Downs backstretch.
But when the MHRC subsequently summoned city structural and fire inspectors to follow up on the engineers’ concerns, the city inspectors found almost no problems.
In an email to Dunn dated Dec. 5, 2014, Mike Clayton — the city’s chief existing buildings inspector — gave the barn area a clean bill of health, writing to Dunn that "no structural issues were found with any of the buildings looked at. There will be no orders issued from this department at this time."
Similarly, a fire inspector for the city — Peggy Prokopich — issued "no reports for the barns as there were no violations found at time of inspection."
The inspector did find seven minor code violations in the kitchen and dormitory buildings on the Downs backstretch, such as the need to upgrade three smoke alarms, repair an electrical outlet and fix a broken window.
All were quickly repaired.
But even after the barn area passed structural code with flying colours and was brought up to the city’s strictest fire code, Dunn says the MHRC continued to insist on costly repairs as a condition of issuing the track its racing licence for 2015. Dunn said the Downs ultimately had no choice but to make $300,000 of repairs to the barn area over the winter to placate the commission.
The MHRC’s demands didn’t end there. Even before a single race has run this year, the MHRC is threatening the track’s licence for 2016, demanding in a motion passed March 3 that the jockey club "provide a comprehensive plan for repair and remediation of the buildings and structures in question prior to their application for a 2016 race licence."
Blair Miller, president of the HBPA, said owners and trainers have no idea why the original engineers’ report was ordered by the MHRC, much less why the track is still being forced to make repairs even after passing code.
"I’ve never heard of a single injury to horses or people that has been caused by the infrastructure back there," said Miller. "We meet with Darren Dunn every single Saturday. I guarantee we’re the only track anywhere in North America where the horsemen meet with the CEO once a week. And if we ever feel there’s something that needs to be fixed, they do it instantly.
Safety is paramount around here and they’ve never given us a problem getting something fixed — not once."
❚ Similarly, the MHRC last year hired a former Mountie, Pat Dauk, to do a security consultation of the backstretch area. Like the infrastructure inspection, Miller says the security inspection was a solution in search of a problem.
"Can people sneak on the backstretch at the Downs? Of course they can. Can people sneak on the backstretch at any racetrack in the world? Of course they can. It’s just the reality of how racetracks are laid out," said Miller. "But has there ever been an incident of someone coming on the Downs backstretch and hurting a horse or a person? Absolutely not — not in all my decades of working at that track."
Dauk recommended a series of very expensive upgrades, including the installation of a video monitoring system of the entire barn area that Dunn said would cost the track in excess of $600,000 to install.
The jockey club replied to the MHRC in a letter dated Oct. 1, 2014 that its security consultant’s recommendations were unworkable and pointless, not to mention expensive. Nevertheless, the Downs was informed on Dec. 1, 2014, that the commission "has endorsed the evaluation and would like to implement its recommendations."
❚ The MHRC has also seized control of post times at the Downs, a decision Dunn says has cost "millions" of dollars in lost gross handle.
The Downs, like all racetracks in North America, has for decades sometimes delayed the start of races by a minute or two to allow races at other tracks to go off so as not to interfere with simulcast wagering on Downs races.
Want to get a head start on your day?
Get the day’s breaking stories, weather forecast, and more sent straight to your inbox every weekday morning.
But as of last year, the Downs — perhaps unique in all of horse racing — is no longer allowed to control their own post times and their regulator simply fixes race times regardless of what is happening at other tracks.
Dunn is likely not exaggerating. A 2011 study by Woodbine Entertainment Group found that wagering on Woodbine races dipped 34 per cent when Toronto races ran within one minute — plus or minus — of races in New York State.
❚ The jockey club says its relationship with the MHRC has degenerated to the point where Goodman and Billeck won’t even talk to the two most senior people at the Downs — jockey club president Harvey Warner and Dunn.
They point to minutes of a commission meeting on Feb. 26, 2014, which record Goodman as telling jockey club director Barry Arnason that "members of the MHRC had lost confidence in working with Mr. Warner and Mr. Dunn and asked that Mr. Arnason inform the MJC board that the commission would no longer have dealings with either gentlemen."
Paul Wiecek Reporter (retired)
Paul Wiecek was born and raised in Winnipeg’s North End and delivered the Free Press -- 53 papers, Machray Avenue, between Main and Salter Streets -- long before he was first hired as a Free Press reporter in 1989.
There's been thoroughbred horse racing in Manitoba more or less continuously since 1920, but the sport has been in a fight for its life the past few years.
Here’s a recent chronology of what have been turbulent years for Manitoba horse racing:
❚ Spring 2012: Representatives of the Manitoba Jockey Club and the Peguis First Nation quietly begin discussions on a joint venture that would see the construction of a hotel and convention centre adjacent to the Assiniboia Downs grandstand.
❚ Summer 2012: The province quietly conducts a study of the Downs and thoroughbred racing, which very early in the process focuses on ways to force the MJC to turn over ownership of the Downs to the Red River Exhibition Association.
❚ January 30, 2013: MJC officials learn from a story in the Free Press that the province has decided to strip the Downs of the on-track VLTs used to fund purses and endorsed a plan that would see the RREA take ownership of the track.
❚ Feb. 1, 2013: Tom Goodman appointed chairman of the Manitoba Horse Racing Commission.
❚ April 2013: The Selinger government slashes $5 million in VLT funding from the Downs.
❚ May 23, 2013: The MJC files a $350-million civil suit against the province, Finance Minister Stan Struthers and the RREA, alleging they conspired to drive the Downs into bankruptcy.
❚ Dec. 19, 2013: Officials at the MJC and Peguis hold a news conference to announce a $100-million joint venture to build two hotels and a convention centre adjacent to the Downs on vacant land owned by the MJC.
❚ Apr. 23, 2014: The province and Downs announce they have reached an out-of-court settlement that sees the province restore VLT funding to the Downs as part of a new 12-year agreement in exchange for the Downs dropping the lawsuit.
❚ April 2015: The MJC demands the removal of the chairman and vice-chairman of the Manitoba Horse Racing Commission, accusing them of using their powers to make it unnecessarily difficult — and expensive — for the track to operate.
Horse racing’s economic contribution to Manitoba
While horse racing in Manitoba is no longer anything like the juggernaut it was back in the 1970s and 1980s when pari-mutuel betting on horse racing was the only legalized gaming in the province, it still attracts tens of millions of dollars in wagering and pumps even more into the provincial economy.
❚ A total of $7,668,470.17 was wagered on live racing at the Downs last year. A fraction of that — $3,156,171.20 — was bet locally, with the remainder bet on Downs racing by bettors wagering at partner tracks across North America.
❚ The Manitoba Jockey Club directly employed 255 workers who earned $3.7 million in salaries in 2012 and a 2008 Price Waterhouse study — commissioned by the province — estimated at least another 200 people are indirectly employed by the thoroughbred industry in Manitoba, ranging from trainers to grooms to veterinarians. In 2013-14, the Manitoba Horse Racing Commission issued 477 occupational licences to people working at the Downs.
❚ The 2008 study estimated the thoroughbred racing industry pumps more than $40 million annually into the provincial economy.
❚ The harness racing industry in Manitoba is tiny by comparison. In 2013-14, there were 19 days of harness racing in six communities and $74,087 was wagered. The Downs averaged $60,995 a day in live local wagering in 2013-14.
❚ The Downs effectively pays for its own regulator through a one per cent tax on every horse racing wager laid in Manitoba — amounting to $248,101 in 2013-14.
❚ Much of what the MHRC does is to act as a referee in disputes or rule violations. In 2014, it handed down 23 rulings and a total of $14,420 in fines. The rulings ranged from a $50 fine to trainer Ryan Bratcher for being late to the paddock, to a $7,500 fine to trainer Ardell Sayler for maintaining a business relationship with Mike Pierce, a jockey’s agent, “that lowered the confidence of horsemen in the integrity of racing at ASD.”
❚ The commission’s six government appointees are paid a stipend and, in turn, hire a full-time executive director and office staff as well as racing stewards.
Goodman, a retired lawyer from Stonewall, was appointed by the government on Feb. 1, 2013. Billeck is a former president of the local chapter of the Horsemen’s Benevolent and Protective Association, which represents owners and trainers.
— Paul Wiecek
The Peguis partnership
It’s been five months since officials from the Manitoba Jockey Club and Peguis First Nation announced a $100-million joint venture to build two hotels and a convention centre adjacent to the Downs, but there’s still not a shovel in the ground.
Sources told the Free Press the project continues to move forward, but there have been delays getting the necessary approval from city hall to subdivide the section of the Downs property where the project will be built.
And there is also the matter of a new Peguis Chief, Cindy Spence, who defeated incumbent Glenn Hudson by 62 votes last month to become head of the province’s largest First Nation.
Spence has yet to comment publicly on the project at the Downs, which has seen her band already turn over $15 million to the Manitoba Jockey Club in the form of a mortgage the band now holds on the track property.
Spence did not return a message left with her assistant this week seeking comment on the project, but she did pledge during her campaign to make public the financial details of a number of deals brokered by Hudson, including the Downs deal.
Downs CEO Darren Dunn said this week management of the track has yet to meet with Spence, but they’re hopeful they will be doing so soon.
“We are eager to meet the new chief and share the details of the predevelopment work that has been completed over the last year,” Dunn said. “We are confident that the excitement and potential that this project holds will be acknowledged with continued support.”