Washington Horse Racing Commission

Washington Horse Racing Commission
Meeting Minutes
April 6, 2006

Present were: Hartly Kruger, Chairman; Paul George, Commissioner; Judi Roland, Commissioner; Susan Carlson, Assistant Attorney General; Robert M. Leichner, Executive Secretary; Patty Sorby, Secretary. Bud Hallowell, DVM, Commissioner, attended the WSU staff presentations by phone. Carol Smith-Merkulov, Commissioner, was excused.

The members of the Washington Horse Racing Commission (WHRC) and staff attended a presentation and tour of the veterinary teaching hospital at Washington State University, College of Veterinary Medicine, Pullman, Washington.

Dr. Warwick Bayly, Dean of the College of Veterinary Medicine, welcomed the members of the Washington Horse Racing Commission and staff. He introduced Dr. Harmon Rogers, Director, Veterinary Teaching Hospital, Dr. Tim Baszler, Professor, Veterinary Microbiology and Pathology and Dr. Robert Mealey, Assistant Professor, Veterinary Microbiology and Pathology. Dr. Rogers, accompanied by Dr. Bayly, Dr. Baszler and Dr. Mealey, provided a tour of the Teaching Hospital and new facilities.

After the tour the WHRC members and staff attended presentations by Dr. Baszler, discussing the equine post-mortem examination program; Dawn Christensen-Hunter, veterinary medicine student, previously a veterinary assistant with the WHRC, provided an update on implementation of the recommendations to enhance the WHRC necropsy program adopted by the WHRC in June 2005; Dr. Tucker discussed the value of the recent implementation of MRI versus radiography to the post-mortem program; Dr. Robert Schneider, Professor, Veterinary Clinical Sciences, discussed the application of MRI to the diagnosis and research regarding high suspensory injuries; Dr. Mealey discussed his research on horses and its value in developing new vaccines.

Hartly Kruger thanked Dr. Bayly, Ms.Christensen-Hunter and the Professors for their time and presentations and adjourned the public meeting of the WHRC.

Meeting adjourned at 4:00 P.M.

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Robert M. Leichner, Executive Secretary

Present were: Hartly Kruger, Chairman; Paul George, Commissioner; Judi Roland, Commissioner; Carol Smith-Merkulov, Commissioner; Susan Carlson, Assistant Attorney General; Robert M. Leichner, Executive Secretary; Patty Sorby, Secretary.
Bud Hallowell, DVM, Commissioner, excused.

Commissioner Roland moved to approve the minutes as submitted. Commissioner Smith-Merkulov seconded the motion. Unanimously approved.

Chairman Kruger asked Robert Leichner to describe the tour and presentations by Dr. Warwick Bayly and faculty regarding the visit to Washington State University, College of Veterinary Medicine on the previous day. Mr. Leichner said everyone was very impressed with the programs and facilities.

Commissioners George and Roland also stated how much they enjoyed the presentation and tour.

Chairman Kruger reported on the recent Association of Racing Commissioners International (ARCI) conference in New Mexico. Commissioners George, Roland, and Smith-Merkulov also attended the conference and found the panel discussions on wagering, jockey insurance, simulcasting, off-shore wagering issues, and medication to be very informative.

Mr. Dick Monahan, General Manager of the Walla Walla Fair & Frontier Days race meet discussed the background on the Class C meets insurance problem. He said it all began when the manager of the Jockeys’ Guild mismanaged the funds, resulting in insurance premiums not being paid. All this was discovered after a catastrophic incident in which a jockey was paralyzed and thought he was covered by insurance. The jockey later learned that he was not covered after receiving large medical bills. This incident resulted in the non-profit meets per day cost for insurance coverage doubling from last year. Mr. Monahan said the nonprofit meets were able to get coverage for this year but without assistance they would not be able to do so next year.

Robert Leichner said Senator Hewitt was also concerned and had asked if anything could be done to assist the Class C race meets. Mr. Leichner said Mr. Ron Crockett was assisting the non-profit race meets again this year by contributing $750 per race day towards the cost of insurance.

Mr. Leichner said SSB 6382 authorized the WHRC to use up to $300,000 from its operating fund for assisting the nonprofit race meets, improvement of racing facilities, and equine health research. During the legislative session, the bill, after passing in the Senate 43 to 1, was stalled in the House. Mr. Leichner recognized the assistance of Mr. Crockett in getting the bill to the House Rules Committee, bypassing Appropriations. The bill moved out of Rules to the House floor where it passed 94 to 3. The bill becomes effective on June 7, 2006.

Chairman Kruger said he was appointed to Chair the National Racing Compact (NRC). The NRC handles multi-jurisdictional licensing of individuals in states that have adopted the Compact legislation with a single application.

Chairman Kruger stated the next ARCI conference would be held in Jackson Hole, Wyoming in 2007, Texas in 2008 and possibly Seattle in 2009.

Mr. Ron Crockett said Emerald Downs had many things planned for the tenth anniversary of Emerald Downs and he was looking forward to a great year. He stated there has already been some media coverage, including two very favorable articles in the Puget Sound Business Journal.

Mr. Crockett said purses were as projected, stalls were filling and there are 1070 horses on the grounds now. There will be attractions every day relating to the anniversary, such as giveaways, promotional items and vouchers.

Mr. Crockett said the most important issue next legislative session is to remove the sunset clause from the advance deposit wagering law. He said advance deposit wagering was more popular than he had ever anticipated. He urged the WHRC to do everything possible to assist.

Mr. Crockett indicated he had spoken with Marty Brown, Chief of Staff at the Governor’s office. Mr. Crockett asked the WHRC to consider submitting agency request legislation to remove the sunset clause.

Commissioner Smith-Merkulov moved to authorize Robert Leichner to prepare proposed agency legislation to remove the sunset clause from the advanced deposit wagering statute. Commissioner George seconded the motion. Unanimously approved.

Robert Leichner advised the WHRC that an agreement had been executed between Emerald Downs and Youbet.com to extend the current contract until March 31, 2007.

Commissioner Smith-Merkulov requested Mr. Leichner to ensure the letter of credit is of the standard required by the WHRC.

Robert Lopez stated the key changes were that first time starters and horses that have previously started are to be on the grounds at least five hours before running in a race to allow the official veterinarian to conduct pre-race inspections on first time starters. The rule also authorizes the Class C meets to use furosemide and requires horses to be on the grounds in time for identification and the proper administration of furosemide; limits the number of persons accompanying a horse in the test barn; and adds non-classified substances (those considered to have no effect on the physiology of a horse except to improve nutrition or treat or prevent parasitic infestation) to the uniform classification guideline.

Mr. Lopez said staff had worked on these amendments since the end of 2005 racing season, working with the HBPA and licensed veterinarians, addressing all concerns raised by stakeholders. Staff recommended adoption of the proposed changes to chapter 260-70 WAC.

Chairman Kruger asked for public comment. Mr. Cliff Schellinger, President, Tri City Horse Racing Association, Class C Sun Downs meet, said that it would take some time to get the horsemen used to the new practice, but thought the horsemen would comply.

Commissioner Roland moved to adopt the amendments to chapter 260-70 WAC as presented. Commissioner George seconded the motion. Unanimously approved.

Mr. Lopez stated the current rule requires that all satellite locations be periodically inspected. When inspecting a satellite location the only requirements are to verify the manager and mutuel clerk(s) are properly licensed and that problem gambling signs are posted. In 2005 all location managers and mutuel clerks were properly licensed. There were only two occasions when problem gambling signs were not posted. The WHRC employs two seasonal career investigators. They spent 53 hours and drove over 1,900 miles to inspect satellite sites. Staff believe that the investigator’s time would be better utilized at the live race meet. The rule change allows the staff to randomly inspect the satellite sites or when a complaint is received.

There were no comments received regarding this amendment by stakeholders, staff recommended adoption.

Mr. Crockett said he was in favor of any cost savings that the WHRC could implement and was in favor of the amendment.

Commissioner George moved to adopt the amendments to WAC 260-75-030 Satellite locations. Commissioner Roland seconded the motion. Unanimously approved.

Mr. Lopez stated the purpose of the policy statement was to clarify whom the owner may deputize to enter, nominate or declare a horse. The person entering the horse to run must posses certain information related to the horse, such as, medication, equipment and the name of the jockey. The proposed WHRC policy clarifies that a deputized person must be licensed as a trainer or jockey agent. The person designated will also be responsible for the accuracy of the information provided and may face possible disciplinary action for inaccurate entries.

Commissioner George asked whether the trainer was still ultimately the responsible person regarding the horse and why was it necessary to change. Mr. Leichner responded that the trainer was ultimately responsible.

Commissioner Smith-Merkulov did not feel comfortable referencing the various WAC rules in the policy statement and suggested removing the WAC references and add to the sentence “…Therefore, the WHRC has determined that an owner or Trainer …” and at the end of the statement add “…and may face possible disciplinary action regarding inaccurate entries.”

Commissioner Smith-Merkulov moved that the policy be adopted with the changes she suggested. Commissioner George seconded the motion. Unanimously approved.

Mr. Leichner said with the passage of SSB6382, the WHRC needs to promulgate rules implementing the legislation. This legislation allows the WHRC the ability to spend up to $300,000 from the WHRC operating account to assist non-profit race meets with capital improvements and support operations at the meets. It also allows the WHRC to create a jockey incentive program and support equine research at Washington State University.

Mr. Leichner introduced Mr. Scott Saito of the WHRC staff who was responsible for developing a jockey incentive program for the Class C meets. Mr. Saito explained that the Class C meets had been experiencing a shortage of jockeys to ride the horses because out-of-state meets were competing at the same time and offered incentives. Due to the shortage of jockeys, some horses at Washington’s non-profit race meets were unable to race.

Mr. Saito offered three options: 1) do nothing; 2) adopt the Oregon model, which distributes monetary awards based on performance and requires participation in a minimum number of race meets; 3) each jockey would receive a point for participating in the race and additional points for finishing in the top four. The jockey would receive the participation point for weighing out. There would be no penalty for not riding in all non-profit race meets.

Staff recommended option two and in order to stay competitive with other jurisdictions recommended the jockey incentive fund be a minimum of $30,000.

Mr. Dick Monahan of the Walla Walla Fair & Frontier Days (Walla Walla Race Meet) and Mr. Cliff Schellinger of Tri-city Horse Racing Association (Sun Down Race Meet) were in agreement with utilizing a point system. They recommended a point for each race in which the jockey’s horse is a starter and a point for finishing in the top three. A prorated reduction of the number of points a jockey earned would be applied for each day that the jockey did not ride.

Commissioner Smith-Merkulov moved to adopt option two Jockey Incentive Program-ORC Model, with the changes during the discussion. Commissioner George added that at a minimum the WHRC needed to match the funds offered by Oregon. Commissioner Roland seconded the motions. Unanimously approved.

Chairman Kruger and Robert Leichner both expressed their thanks to Mr. Saito for his hard work on the project.

Mr. Leichner said that after visiting the non-profit meets it was clear that the Donohue funds were insufficient to cover their capital improvement needs. Mr. Leichner suggested requests for capital improvement and operational support be prepared similar to mini-grants and submitted for review and approval by the WHRC.

Mr. Monahan spokesman for the non-profit race meets said the non-profit meets would work together and bring proposals to the WHRC as a group. They were most concerned that the funds be directed to them, not to their respective county, to ensure the funds were used for horse racing activities.

Mr. Leichner said the WHRC attended a presentation at the WSU, College of Veterinary Medicine on April 6th and toured the facility. Proposals for research projects being conducted at the College that needed funding were also discussed.

Mr. Leichner stated a proposed rule and application procedures for funding would be distributed to the stakeholders for review and comment.

Mr. Leichner stated that the revenue received from advance deposit wagering made it possible for the WHRC to offer additional assistance to the nonprofit racetracks and WSU’s equine research.

Mr. Leichner said there were two reports, calendar year totals and race year totals.

Mr. Leichner reviewed the revenue documents and said revenues continue to exceed expenditures. Expenditures will increase as the season begins. The WHRC operating fund balance is the highest that it has been in the last fifteen years.

Mr. Leichner said Emerald Downs had conducted its first handicapping contest. Mr. Adrian Buchan [Patty – can you add something identifying who he is? Emerald Downs staff?] submitted the follow-up report and stated that the contest was well received.

Mr. Leichner had received an application for an honorary license from Mr. Robert W. Smith, a former longtime employee of the WHRC. Staff recommended approval pending return of fingerprint information.

Commissioner George was honored to recommend approval of Mr. Robert Smith for an honorary license. Commissioner Roland seconded the motion. Unanimously approved.

Mr. Monahan commented that he appreciated the Commission holding its meeting in Kennewick and the Commission’s interest and support for Class C racing.