WVRC rejects Charles Town stakes schedule; Classic in jeopardy

By: Tom LaMarra

Update: Jan. 23, 2018

West Virginia Gov. Jim Justice told the West Virginia Gazette-Mail he supports the grade II Charles Town Classic and has asked his staff to examine ways to reverse the West Virginia Racing Commission’s Jan. 23 decision to limit the purse to $300,000 unless the track owner antes up matching funds to increase it.

Posted: Jan. 23, 2018

In a highly unusual move, the West Virginia Racing Commission Jan. 23 didn’t approve the 2018 stakes schedule for Hollywood Casino at Charles Town Races because of one commissioner’s belief that the $1.25 million purse for the grade II Charles Town Classic isn’t a productive use of purse money.

The commission in December tabled the stakes schedule after member Ken Lowe suggested the Classic purse be capped at $300,000. Charles Town officials, who have since documented the Classic’s positive impact on its brand as well as solid increases in pari-mutuel handle on the nightly product, contended the proposed reduction would in effect kill the race.

Charles Town and the Charles Town Horsemen’s Benevolent and Protective Association have a contract that states that 8% of purse money be set aside for stakes. The horsemen’s group in a letter to the WVRC confirmed that amount; management has the right to spend it as it sees fit.

The proposed 2018 stakes schedule is similar to those approved in recent years. The Classic was listed on the schedule for April 21.

Like most racing states, West Virginia has a rule that states the racing commission has the authority to approve stakes schedules. WVRC Executive Director Joe Moore told commissioners that staff research showed that no other commissions have rejected stakes schedules if a track and horsemen’s group have an agreement in place.

Lowe made a motion to approve a $300,000 purse for the Classic and allow Charles Town owner Penn National Gaming Inc. to increase the purse by “matching” the amount that would come from the purse account. He said if management wants a $1.2 million purse for the Classic, it can contribute $600,000 in company funds and the WVRC would approve a purse account expenditure of $600,000.

It wasn’t explained during the meeting why a racing association would have to match funds already approved by a horsemen’s contract.

“This will really put a dagger into the industry and the racing program here,” Charles Town Vice President of Racing Erich Zimny told the commission.

There seemed to be some confusion by the racing commission over the vote, which wasn’t limited to the Charles Town Classic purse. Zimny, who suggested the race may not even be run this year given the drastic purse cut and tight time frame, said the decision could impact the track’s other big program, the Race for the Ribbon, which raises money for breast cancer awareness and features the grade III Charles Town Oaks.

“We’ll need to resubmit the stakes schedule,” he told the commission. “One unprecedented call by you today is enough.”

The letter from the Charles Town HBPA didn’t directly address the purse of the Classic. In comments during the meeting, President Randy Funkhouser instead discussed how increasing overall purses can help agribusiness and tourism grow in the Eastern Panhandle, where Charles Town and most of the state’s Thoroughbred breeding operation are located.

Funkhouser noted how state legislators have shifted purse money generated by video lottery terminals and table games to help cover a state workers’ compensation fund deficit and to pay for other programs.

“We’re willing to work with the governor, the legislature, the racing commission and other stakeholders to develop a plan to reinvigorate the racing industry,” he said. “There was a lot of negotiation on our contract, and we acceded to the 8% for stakes. If in the future our purse money is over and above what we have now, 8% would still go PNGI for stakes funding.”

The current contract between Charles Town and the horsemen’s group ends this year. It remains to be seen what impact the WVRC’s decision will have on those negotiations.

Lowe, who was appointed to the commission by Gov. Jim Justice—he advocated during his campaign for the Eastern Panhandle to have a major Thoroughbred race—reiterated that he believes $1.25 million for the Classic “exceeds what is needed.” He earlier had advocated for using some of the money for multiple $100,000 or $200,000 stakes.

“The whole idea is to get owners back in the game,” Lowe said. “We need to get back together again and make it work.”

Charles Town Racing Secretary Charlie McIntosh noted the track has the discretion to set the stakes schedule as long as the amount is 8% or less of total purses. He told the commission he’s in favor of having discussions about how to elevate West Virginia racing and breeding, but “we need to put up $1.2 million for the Classic. This has been the driving force for the program at Charles Town.”

The Classic day card accounts for nine of the 10 largest daily handles in Charles Town history and, according to Zimny, has been a big part of per-race handle growth of 64.5% since the race was inaugurated in 2009. In addition, the amount of purses paid for West Virginia-bred races has doubled from 2009 to 2017, he said.

“It has a year-round effect,” said Zimny, who noted pari-mutuel growth has generated an additional $6 million for purses in recent years at a time when the amount of purse revenue from VLTs has declined or been flat.

Meanwhile, the WVRC approved the 2018 schedule for Mountaineer Casino, Racetrack & Resort pending a public comment period.

Last year, the Mountaineer HBPA lobbied and received approval for 131 racing programs, down from 150. For 2018, the horsemen’s group worked with management to drop the number to 123 in order to maintain purses and grow field size.

The meet is scheduled for May 1-Nov. 28 with racing four nights a week. Mountaineer HBPA officials have said they believe forming a circuit with Hollywood Casino at Mahoning Valley Race Course—located 45 minutes away in Ohio—is the best way for Mountaineer to protect its program. Mahoning Valley races from late November through late April.

(Charles Town photo by Tom LaMarra)