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Montana racing raises questions


August 7, 2005     E-mail this page to a friend!

IMS Racing
August 2, 2005

Topper:

Upon reading the notes from the conference call the Montana Board of Horse Racing conducted the other day as well as some of the comments I read in the Billings Gazette from people in the industry (whom I assume know the facts and figures of running a race meet), certain questions came to mind.

I believe the MBOHR is doing the proper thing to review the potential for a single race meet in Montana. In fact, one of the things we have been known for in this state is not planning ahead. I commend them for that. If they could come up with a central location that works for the majority, increase the days offered to the horsemen and increase the purses by combining potential revenues, then it seems to make sense. However, the figures to this scenario just donít fit.

(1) Closing race tracks and eliminating racing opportunities to favor 1 superior track doesnít work. Look at the number of horses and owners today compared to five years ago in the state of Washington. People that raced at Playfair or Yakima did so because of local interest. Those people are now out of the industry and available horses have dwindled in numbers. Purse structure is important, but at some point, if you donít have enough days to offer, combined with local interest and local horsemen, race meets struggle to attract outside stables.

(2) The estimates for the daily handle of 30 days at one track in Montana is $40,000 per day. That is $1,200,000 in handle compared to the $1,940,000 of statewide handle in 2004. Thatís a loss of $740,000 in handle (38%) or approximately $160,000 in revenues. It would take an increase of $4,000,000 in simulcasting (50% more than simulcasting did in 2004) to match the loss of revenues at 4%.

(3) How do you offer higher purses with less revenues? With less revenues for operations, who makes up the shortfall in running the track? Fifteen years ago, we had to hit $50,000 in handle to pay the bills. The Yellowstone Horse Racing Alliance has done an outstanding job of utilizing donated labor and maybe thatís part of the financial picture for the future.

(4) In regards to simulcasting, some of the MSP sites participate in an effort to support their local horse racing. 90% of the MSP sites donít even break even when it comes to the business aspect of simulcasting. With 1 track in the state, I would be concerned that getting more sites might be difficult and keeping the ones we have would be an uncertainty.

(5) If you take a look at the budgets for each of the smaller race meets in the state, I would be surprised not to see outside sources of revenue for the race meet. People donate to help the race meets go. Those revenues from the smaller communities would be lost to the Montana horse racing industry with the one track proposal.

This is just a guess, but with one meet, I see bottom purses in the range of $1,400 to $1,600. Some of the current purse money would need to be used for operations. The sad thing is this may eventually happen on its own. The smaller race tracks may voluntarily give up their days due to a lack of community support. When that happens and only one track prevails, we wonít be able to go back as fair boards will find other ways to provide entertainment and local horsemen, without their local track, will have sold what animals they had and left the business.

Tom Tucker
IMS Racing
848 Main Street, Suite 4A, Billings, MT 59105
(P): 406-252-7210 (F): 406-256-5577 ims@imt.net