ITHA issues statement on Arlington Park contract impasse

Posted: Jan. 2, 2020

The Illinois Thoroughbred Horsemen’s Association has released the following statement on the stalemate with Churchill Downs Inc. on how overnight purses will be funded at Arlington Park in 2020:

Churchill Downs Inc. deceived Illinois elected officials and our state’s racing industry when it leveraged the support of horsemen and other racing stakeholders to win passage of a gaming expansion measure that will boost the profits at its Rivers Casino—only to then abandon its years-long plan to develop a racino at Arlington Park.

Now Churchill is threatening the future of live racing at Arlington by refusing to commit to a contract with the Illinois Thoroughbred Horsemen’s Association that will adequately fund overnight purses in 2020. Arlington was required under the state’s new gaming law to sign a contract with the ITHA by Dec. 31, 2019. Now that the deadline has expired, the track is out of compliance with the law. The law states: “A contract with the appropriate Thoroughbred or Standardbred horsemen organization shall be negotiated and signed by the organization licensee before the beginning of each calendar year.”

Churchill’s plan to allocate just $130,000, on average, for overnight purses each day (in 2020) will render Arlington’s races irrelevant for the purpose of simulcasting and will, invariably, fail to attract quality stables to the track. Overnight purses average approximately $180,000 per day in Indiana, for instance, and roughly $174,000 per day in Minnesota.

Churchill knows what it takes to produce a full calendar of quality racing. In its home state of Kentucky, Churchill has, with its substantial loan to the purse account at Turfway Park, shown a commitment to Thoroughbred racing that is consistent with the reputation it built, over generations, as the preeminent track operator of American racing. Yet in Illinois—as elsewhere in the country, from Hollywood Park to Calder Race Course—Churchill is rapidly abandoning any meaningful commitment to racing.

Churchill, in its unconditional pursuit of corporate profit, has worked methodically to reduce the scope of live racing, diminish overnight purses and undermine the efforts of Thoroughbred owners and trainers—the men and women who, in contrast to Churchill, remain dedicated to growing jobs and economic opportunity at the tracks and across agribusiness.

Illinois cannot stand for that. Our state’s elected officials went out of their way, as part of the gaming expansion law enacted earlier (in 2019), to provide the tools that Illinois Thoroughbred horse racing requires to build a stronger future for itself. Lawmakers approved and Gov. J.B. Pritzker signed legislation granting Churchill the authority to transform Arlington into a racino as a means to generate additional funds to boost overnight purses and help our industry once again compete with tracks in other states already using gaming revenue to supplement purses.

Inclusion of horse racing in that bill was a sign of elected officials’ recognition that our industry supports jobs—from veterinarians and blacksmiths to backstretch workers and hay and feed suppliers—that other forms of gaming do not. It also was a result of lobbying by Arlington and the state’s other tracks, in concert with Thoroughbred owners and trainers, over more than a decade. Arlington actively enlisted the cooperation and support of the ITHA and the state’s other horsemen’s associations precisely because it recognized that partnership with us would enhance its own credibility.

Churchill embraced the opportunity to expand the operation of Rivers Casino—as part of the approved gaming bill—but didn’t even bother to apply for the Arlington racino license. It used us—the working men and women of horse racing—to help achieve its objective. Thereafter, it dismissed our priorities out of hand. It showed contempt for the good faith efforts of lawmakers to supply Arlington with the authority it had so ardently demanded. And it violated the public trust as expressed by the terms of the new gaming expansion law.

But while Churchill took a pass on the privilege to develop a racino operation that would significantly improve overnight purses, it remains in control of Arlington, the state’s flagship track, and, as such, has an ongoing obligation to this industry. Overnight purses next year should be adequately funded—we believe at a minimum of $200,000 on average each day—for Arlington to be competitive and ensure the continuation of live racing here.

Churchill clearly has the cash to manage such a modest investment in racing:

Churchill took $4.47 million from the horsemen’s purse account, pursuant to the state’s antiquated “recapture” provision, in 2019 alone.

Churchill has annually used overnight purse dollars (prizes that, by and large, support Illinois jobs) to subsidize its Arlington Million Day stakes races (prizes that often go to those from other states or countries). Churchill could instead use its own dollars to subsidize those stakes races—just as the Stronach Group has said it will devote $4 million for stakes at the Pegasus World Cup Championship Invitational Series.

Churchill is poised to make a fortune by operating sports betting in Illinois—a form of wagering that, under the new gaming law, would otherwise provide no benefit to purses.

Churchill’s indifference to the future of live racing in Illinois has deprived Arlington Heights, surrounding communities and the state of a greater, more diversified tax base and the considerable economic benefits that would result from the operation of a racino at Arlington. In acting to please its own shareholders, to the detriment of all other concerns, it is threatening to squelch the rebirth of Illinois racing that our elected officials intended.

Churchill has publicly complained about the obligation it would have to better fund Arlington purses if it opted to develop a racino at that track. That’s nonsense. The terms of the new gaming law were good enough for Hawthorne Race Course and Fairmount Park, which moved swiftly to apply for their respective racino licenses and create plans to develop those gaming facilities.

Hawthorne also didn’t hesitate to reach agreement on a 2020 contract with the ITHA, taking all of an hour to negotiate that deal with us. (Owners and trainers at Fairmount are represented by a separate association.) Hawthorne has embraced the opportunity presented by the new gaming law and has gone out of its way to accommodate other racing stakeholders during its multi-month racino construction phase that will soon begin. It is allowing horses to remain in barns and backstretch workers to stay in dorms through May 1, until Arlington’s meet begins, free of charge.

The reality is that Churchill, by refusing to develop Arlington as a racino, stifled the competition facing the Rivers Casino that it now controls—just a 12-mile drive from Arlington. By keeping Arlington under its control, Churchill is limiting the threat of future competition. Illinois horsemen have called on Churchill to divest Arlington to a qualified owner that will operate the racetrack as a racino as intended by law and for the benefit of the state. And, if it does not act responsibly, we have urged gaming regulators to hold the company accountable.

It’s past time for Churchill to act in good faith and genuinely promote the best interests of our sport and industry and our state’s taxpayers. Churchill can start by approving a 2020 contract that will ensure adequate and competitive overnight purses at Arlington.

(Arlington Park photo courtesy of ITHA)