Washington Horse Racing
Commission
Meeting Minutes
August 11, 2005
Present were: Hartly Kruger, Chairman; Judi Roland,
Commissioner; Dr. Bud Hallowell, Commissioner; Carol
Smith-Merkulov, Commissioner; Deanna W. Oppenheimer,
Commissioner; Susan Carlson, Assistant Attorney General;
Robert M. Leichner, Executive Secretary; Patty Sorby,
Secretary.
Chairman Kruger introduced and welcomed new member
Carol Smith-Merkulov who had been appointed by Governor
Gregoire on July 17, 2005. Chairman Kruger briefly
described her background.
Item #1. Approval of the meeting minutes of July
14, 2005.
Commissioner Roland moved to approve the minutes
as submitted. Commissioner Hallowell seconded the
motion. Unanimously approved.
Item #2. Chairman’s report.
Chairman Kruger stated that he was continuing to
communicate with the National Racing Compact and the
Association of Racing Commissioners International
(ARCI).
Item #3. Emerald Downs’ request for an additional
Pick 4 and Item #4. Emerald Downs update.
Mr. Ron Crockett, president Emerald Downs, explained
the Pick 4 request and updated the members on the
status of Emerald Downs’ handle. Mr. Crockett
also discussed the background of the status of Emerald
Downs and gave an overview of recent legislation that
has benefited Emerald Downs.
Mr. Leichner stated no action was necessary by the
Commission on the Pick 4 request, and approval had
been given to Emerald Downs to conduct the additional
Pick 4 wager. This item was an informational update
for the members.
Item #5. Walla Walla Fair & Frontier Days Fall
meet officials.
Mr. Leichner stated the officials in the member’s
packet were the same officials that had been approved
for the Spring meet at Walla Walla. The WHRC officials
listed were also the same and staff recommended approval.
Commissioner Hallowell moved to approve the officials
as submitted. Commissioner Roland seconded the motion.
Unanimously approved.
Item #6. Rules of Racing: Adoption Hearings:
a) WAC 260-12-250 Problem gambling.
Mr. Leichner stated the amendment regarding WAC 260-12-250
Problem gambling is to strike the penalty contained
in this rule and move it to WAC 260-84-060 Penalty
matrixes.
Commissioner Oppenheimer moved to adopt the amendment
to WAC 260-12-250 by striking the penalty contained
in WAC 260-12-250 and place it in WAC 260-84-060 Penalty
matrixes. Commissioner Hallowell seconded the motion.
Unanimously approved.
b) WAC 260-70-965 Bicarbonate testing.
Robert Leichner presented three versions of this
rule for consideration by the members of the Commission.
1. Language filed with the code reviser provided
(1) split samples will only be taken if the owner
or trainer has on file a signed split sample authorization;
(2) when taken all split samples are shipped to the
split sample lab determined by the commission; and
(3) the cost of the split sample testing is the responsibility
of the owner or trainer.
2. The second version provided (1) split samples would
be taken on all horses when bicarbonate testing is
done; (2) the owner or trainer must notify the official
veterinarian whether or not they want the split sample
tested; and (3) the cost of the split sample testing
is the responsibility of the owner or trainer.
3. The third version provided (1) split samples will
be taken on all horses when bicarbonate testing is
done; (2) all split samples shall be tested at a lab
designated by the commission; and (3) the cost of
the split sample testing is the responsibility of
the commission.
Public comment.
Mr. Ron Crockett questioned how the invoicing would
be done on version one. Commissioner Roland asked
which version was now in place as an emergency. Mr.
Leichner stated version one. Commissioner Oppenheimer
asked whether the staff had found the current emergency
rule satisfactory. Mr. Leichner said yes, but it had
only been used in post-race testing as a trial. Mr.
Leichner stated the tests had been done only post-race
to determine that the results were consistent between
the labs knowing the test results would be low. To
be conducted properly, the sample must be drawn pre-race.
In regards to the issue of who would pay for testing
of the split sample, staff expressed concerns that
if the Commission paid for the testing of the split
sample, it would set a precedence leading to the Commission
paying for the testing of other split samples.
Mary Ann O’Connell, executive director of the
HBPA, stated she preferred option three. She stated
that only a few tracks have started bicarbonate testing
and she is concerned with laboratory errors and putting
the owner or trainer in a position to have to prove
their innocence. She stated that it would not set
a precedent for the Commission to accept responsibility
for payment of this testing because this type of testing
is very different from post-race testing. Mr. Crockett
agreed with Ms. O’Connell and strongly urged
the members to adopt version three.
Commissioner Hallowell stated he had come to the
conclusion that the Commission should pay for testing
the split sample for the same reasons expressed by
Mary Ann O’Connell.
Commissioner Smith-Merkulov asked about the testing
labs and suggested the language should be corrected
to state “laboratories” not laboratory,
to avoid the suggestion that the Commission uses only
one lab to conduct the testing.
Chairman Roland moved to accept version three of
proposed rules. Commissioner Hallowell seconded the
motion with the change of the word “laboratory”
to “laboratories”. Unanimously approved.
Mr. Leichner said that WAC 260-28-290 Trainer—ownership,
discussed in the July Commission meeting had resulted
in additional comments and concerns being received
and adoption has been postponed until a consensus
is reached. WAC 260-32-160 Physician’s statement
is also postponed. Staff has been considering including
this rule in chapter 260-36 WAC and at the same time
also requiring a physician’s statement for exercise
riders, pony persons and outriders as well as the
jockeys.
c) Chapter 260-36 Occupational permits and licenses
discussion.
Mr. Leichner said the current process regulatory
staff uses to approve licenses is inconsistent with
Chapter 260-36 WAC and inefficient. Each applicant
is entered in the WHRC licensing database and those
requiring fingerprints are sent to security for criminal
history and background checks. Ultimately all license
applications are routed to the stewards for approval
or denial. Chapter 260-36 WAC does not require all
licenses to be approved by the stewards. Also, the
current process is not an efficient use of steward’s
time and can be improved. The Commission has committed
to the stakeholders to look for ways to keep the costs
to a minimum and this is one area that costs could
be reduced.
Staff recommended that when the criminal history
record returned from the FBI, the security investigator
would review the history and compare it to the person’s
application. The security investigator would also
determine whether the person is licensed is currently
suspended or revoked in another jurisdiction. If the
person has no arrests, convictions, suspensions, or
revocations, the security investigator would approve
the license application. If the application or the
criminal history lists an arrest or convictions that
may disqualify an applicant, the investigator would
request the applicant appear at a steward’s
ruling conference. Also, initial applications for
certain skill and/or knowledge licenses would require
steward’s approval.
Doug Moore, steward, said that it didn’t take
much of the steward’s time to approve each application,
and that by looking at each application it would initiate
a recollection regarding an individual who may have
been suspended or in trouble in another jurisdiction
and could give them an opportunity to further check
out an individual prior to approving the application.
Mr. Moore didn’t feel comfortable changing the
process.
Commissioner Oppenheimer stated that in her business,
they had instituted a random selection of applicants
to be checked and it had worked out well. She suggested
that this situation would benefit by instituting a
random selection process for checking applicants.
Chairman Kruger stated that he was in agreement with
Commissioner Oppenheimer’s suggestion. He directed
staff to move forward with streamlining the efficiency
of the license approval process and include Commissioner
Oppenheimer’s suggestion.
Chairman Kruger announced a break at 11:05 a.m. Reconvened
at 11:11 a.m.
Mr. Leichner raised the issue of who should be licensed
and who should have access to the grounds of a racetrack.
He said that Dick Monahan, Cliff Schellinger and public
comment at the July Commission meeting suggested that
most associations were in agreement that certain individuals
working at the meet in various capacities should not
be required to obtain a license such as concession
workers, parking valets, or people who do not directly
participate in horse racing. Another issue is whether
there should be an age limit to obtain a license.
Currently seven people under fourteen are licensed.
Mr. Leichner also said there was a problem with access
to the backstretch of the Class C race meets. The
gates at the Class C meets are also the public entrance
to the stalls and used by visitors to the county fairs.
Mr. Leichner stated the WHRC could not restrict entry
during the race meet without causing other problems
for community events at Class C grounds.
Chairman Kruger asked Mr. Leichner to move forward
and develop some alternatives regarding who should
be licensed, whether by task and responsibility or
both, and to work with the Class C associations regarding
entry at the backstretch gates.
Item #7. Update on study of Labor & Industries.
Mr. Leichner provided an overview of the study which
included a historical perspective. He stated in other
industries, premiums reflect the relative degree of
risk scaled to the relative size of the business.
However, the premiums in the racing industry are established
per licensee, without regard to the number of employees.
Chairman Kruger recessed the meeting at 12 noon stating
that when the members reconvened, Item #9 (c) and
(d) hearings for Larry Farrell and Jody Davidson would
be heard. Chairman Kruger stated that item 9 (a) hearing
for Navin Mangalee had been rescheduled and (b) hearing
for Jose Zunino had been withdrawn. Meeting reconvened
at 1:00 p.m.
Item #9 Hearings: Hearings were opened at 1:00 p.m.
(c) Larry Farrell
Mr. Larry Farrell appeared in his own behalf. Commission
staff was represented by Michael S. Tribble, Assistant
Attorney General. Mr. Tribble offered exhibits 1-6
and they were admitted by Chairman Kruger. Mr. Tribble
briefly described the facts regarding Mr. Farrell
and asked that Mr. Farrell be denied the ability to
apply for a license. Mr. Farrell appeared on his own
behalf and offered three exhibits, that were admitted
by Chairman Kruger and marked as Respondent’s
exhibits 1, 2 and 3.
Mr. Farrell was granted the ability to apply for
a conditional license as an exercise rider and/or
groom, containing several conditions by which he must
abide. An order will be prepared for signature by
the Commissioners and then provided to Mr. Farrell.
Hearing closed.
(d) Jody Davidson
Mr. Jody Davidson appeared in his own behalf. Commission
staff was represented by Michael S. Tribble, Assistant
Attorney General. Mr. Tribble offered exhibits 1-4
that were admitted by Chairman Kruger. Mr. Tribble
called Mr. Dick Smith, WHRC Investigator, to testify.
The Commission also heard testimony from Doug Moore,
presiding steward, and Mr. Davidson, and two witnesses
on Mr. Davidson’s, Mike Reardon and Robert Kuvara.
Mr. Davidson was granted a conditional exercise rider
license at such time as he is granted an exercise
rider’s license by the Oregon Racing Commission.
This license will be subject to conditions. The Commission’s
ruling will be in a final order which will be provided
to Mr. Davidson.
Hearings closed at 3:32 p.m.
Commissioner Oppenheimer was unable to attend the
remainder of the meeting and was excused.
Item #7 Update on study of Labor & Industries,
continued.
Mr. Leichner stated that the options for calculation
of the L & I premium must balance fairness and
efficiency. He reviewed the six alternatives in the
report: (1) hourly based; (2) reduction of trainer
base premium adding a premium calculated by the number
of track/farm stalls; (3) reduce trainer base premium
and add scaled premiums based on the number of groom
slots; (4) reduce trainer premium and add scaled premium
based on groom slots and charge exercise riders and
pony persons one-half of the medical aid premium;
(5) reduce trainer base premium, charge exercise riders
and pony persons one-half medical aid premium, trainer
would continue to pay for groom slots; and, (6) reduce
trainer base premium, add per stall premium and scaled
premium based on groom slots, charge exercise riders
and pony persons one-half of medical aid premiums.
Mr. Leichner said the next step would be consider
input from the horse racing industry and to finalize
the report. He stated that there would need to be
a coalition representing a wide basis of support in
order to go to L&I to work out a change. Only
alternative #1 would require a legislative change.
Mr. Leichner said that the final report should be
ready for the September meeting of the Commission.
Chairman Kruger thanked Ken Mitchell for all his
excellent work on the project.
Item #8. Proposed agency request legislation for
2006 – Public comment.
Mr. Leichner had mailed the proposed agency legislation
to stakeholders. The proposal authorizes the WHRC
to distribute up to $300,000 per fiscal year to encourage
the development of the equine industry at nonprofit
race meets and equine health research.
Mr. Leichner advised the members that an alternative
version of the proposal was in their packets. This
alternative would authorize the expenditure of the
$300,000 for the purpose of development of the equine
industry, maintenance and upgrades or acing facilities,
and equine health research. The proposal would direct
that the Commission give first consideration to uses
that assist the nonprofit race meets and equine health
research. The Commission decided to pursue this alternative
version. The revised version will be sent to stakeholders
for further comment and Mr. Leichner will report back
at the September meeting.
Item #10. Executive Secretary’s report.
a) Request for extra-territorial coverage for Labor
& Industries for Longacres Mile, Emerald Downs
Breeders’ Cup Derby, Emerald Breeders’
Cup, Washington Cup Day and the Gottstein Futurity.
Mr. Leichner requested approval of the extraterritorial
coverage waiver for the Labor & Industries fees
for out of state participants shipping in horses for
the Longacres Mile week, Emerald Downs Breeders’
Cup Derby week, Washington Cup Day week and the Gottstein
Futurity week. Those granted the waiver must not employ
any Washington employees other than a pony person
or they are subject to Labor & Industries fees.
Commissioner Roland moved to approve the waiver for
the extraterritorial coverage for the Labor &
Industries premiums for the Longacres Mile, Emerald
Downs Breeders’ Cup Derby, Washington Cup Day,
and the Gottstein Futurity. Commissioner Hallowell
seconded the motion. Unanimously approved.
b) Update – TVG license renewal.
Mr. Leichner stated the renewal wasn’t completed
and would update the Commissioners at the September
meeting.
c) Accountant’s July 2004/2005 recap.
Mr. Leichner said that total revenue was up 6.45%.
The average daily receipts are up 3.69%.
d) 03-05 Budget.
Mr. Leichner said the total expenditures for the
biennium were $3,822,646 and revenue was $4,097,000
resulting in a variance of $275,131. The fund balance
was $664,526.
e) Problem Gambling Advisory Committee.
Mr. Leichner said that an advisory committee regarding
problem gambling had been established as required
by statute and he is a member.
f) Equine Medical Testing – Request for Proposal.
Mr. Leichner said the request for proposal had been
completed and sent to approximately fifteen potential
bidders for the contract to do the equine medication
testing for the Commission.
Item #11. Executive Session.
Chairman Kruger announced the Commission would hold
an executive session to discuss pending and potential
litigation against the agency with counsel and review
the performance of an employee. Meeting was adjourned
to executive session at 4:15 p.m. The public session
was reconvened at 4:32 p.m.
Item #12 Executive Secretary salary.
Commissioner Smith-Merkulov moved to increase Robert
Leichner’s salary to $6,384.00 per month. Commissioner
Roland seconded the motion. Unanimously approved.
Commissioner Smith-Merkulov moved to authorize the
general salary increase of 3.2% beginning September
1, 2005 for Robert Leichner. Commissioner Hallowell
seconded the motion. Unanimously approved.
Item #13. Any other business that may be properly
brought before the Commission.
Chairman Kruger asked for any other business.
Commissioner Hallowell said the Commission needs
to keep strength in the product and that possibly
some of the budget restrictions could be re-evaluated
such as the clocker located at the chute.
Chairman Kruger adjourned the meeting at 4:45 p.m.
____________________________________
Robert M. Leichner, Executive Secretary
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