OKLAHOMA HORSE RACING COMMISSION REGULARLY SCHEDULED MEETING AUGUST 23, 2012 CALL TO ORDER/ROLL CALL Chairwoman Goumaz called the of the Commission to order at 9:43 a.m. in Track North at Remington Park Racetrack and Casino, Oklahoma City, Oklahoma. Commission members answering roll call were Commissioner Bowers, Commissioner Burton, Commissioner Carter, Commissioner Leonard, Commissioner Lucas, Commissioner Savage and Chairwoman Goumaz. Commissioners Bollenbach and Kirk were absent from the meeting. The following Commission staff members were also in attendance: Mr. Constantin A. Rieger, Ms. Mary Ann Roberts, Mr. Mike Dixon, Mr. Mike Corey, Ms. Bonnie Morris and Ms. E J Brees. Approximately nine persons attended and signed the registry which is part of the record. APPROVAL OF Commissioner Bowers moved to approve the drafted Minutes from the June 21, 2012 Rescheduled Regular Meeting. Commissioner Burton seconded the motion. The vote was as follows: Aye: Mr. Bowers, Mr. Burton, Mr. Leonard, Ms. Goumaz Abstain: Mr. Carter, Mr. Lucas, Mr. Savage Mr. Bollenbach and Mr. Kirk were absent from the meeting. The motion passed with 4 ayes and 3 abstentions. PRELIMINARY CONSIDERATION OF CY 2013 RACING AND GAMING LICENSE APPLICATIONS The Commission received three renewal applications from Remington Park, Will Rogers Downs and Fair Meadows at Tulsa for organization licenses to conduct live racing and simulcasting in CY 2013 as well as gaming applications. The following is a summary of the race day applications received.
Remington Park Remington Park, Inc. [RP] applied to conduct two race meetings: a Quarter Horse, Paint and Appaloosa race meeting, 50 days in length, from March 1 through May 27, 2013 and a Thoroughbred race meeting, 67 days in length, from August 9 through December 8, 2013. On August 9, 2012, the Commission received an e-mail from Mr. Mike Shamburg, RP Director of Racing, requesting changes to the proposed CY 2013 Quarter Horse, Paint and Appaloosa race meeting as follows: Deleting March 1-3, 2013 Adding May 31 and June 1-2, 2013 An e-mail, dated August 13, 2012, from the Oklahoma Quarter Horse Racing Association supported the proposed changes which would amend the beginning and ending dates for the Quarter Horse, Paint and Appaloosa race meeting to March 8, 2013 through June 2, 2013. RP also submitted a Racetrack Gaming Operator License application. Mr. Randy Calvert, Counsel for Global Gaming, LLC, and Mr. Scott Wells, RP President and General Manager, spoke on behalf of the racetrack. Mr. Calvert said that requests for changes to the language in the orders had been made in past years after distribution of the Orders, adding that this year the requested changes were made in writing and submitted with the applications. Specifically, RP requested that the Order contain language authorizing distributions of income for the current year as part of the Order rather than making it a condition of the license that the racetrack had to formally request approval at a Commission meeting Mr. Constantin Rieger, Commission Executive Director, asked if RP believed it was receiving the maximum coverage of its races in relationship with TVG and the signals TVG is transmitting. Mr. Wells acknowledged that RP had made contact with TVG, requesting that more races be shown. He also stated that, aside from urging TVG to take RP s signal, there was not much else that could be done from an executive standpoint. Mr. Rieger addressed the issue of establishing a more timely reimbursement plan for refunding the stall and tack room deposits. Mr. Wells said that after the current Thoroughbred meeting is over, the deposit refunds would be paid punctually. 2
Mr. Rieger asked for clarification about the Medical Director Services Contract. Mr. Calvert said that it did not mean that a physician was physically on the track. Rather, the contract provided medical supervision and assistance in developing the on-site first aid services and assignment of on-site emergency medical personnel. Mr. Justin Cassity, Executive Director of the Thoroughbred Racing Association of Oklahoma, (TRAO), voiced three concerns regarding RP s CY 2013 racing license application as follows: The increase for the [track] takeout for the Trifecta wager; The scheduling conflict between the Staff Brief and the racing application on page 69 and The proposed $8,500 minimum purse for overnight races Mr. Scott Wells, RP President and General Manager, stated that the racetrack developed a reduced takeout Trifecta experiment during the Quarter Horse, Paint and Appaloosa race meeting, noting that it failed to increase the Trifecta pools. Additionally, it reduced purse amounts and the amount of money that RP made. Therefore, RP was returning to the original Trifecta takeout. Mr. Wells said that the race dates were still being adjusted and that RP was willing to work with the horsemen concerning dates. Regarding the lowest overnight purse level, Mr. Wells stated that it had been mistakenly listed as $8,500 in the license application but was projected to be $9,000 for CY 2013. Ms. Debbie Schauf, Executive Director of the Oklahoma Quarter Horse Racing Association (OQHRA), said that as a result of a meeting she had recently attended, the OQHRA asked RP to amend its CY 2013 racing license application to change the beginning of the Quarter Horse Meeting back one week, which RP had already done. Will Rogers Downs, L.L.C. Will Rogers Downs, L.L.C. [WRD] applied to conduct two race meetings: a Thoroughbred race meeting, 32 days in length, from March 4 through May 18, 2013 and a Quarter Horse, Paint and Appaloosa race meeting, 28 days in length, with August 24, 2013 proposed as a non-pari-mutuel trials race day and then pari-mutuel racing to be conducted from September 5 through November 3, 2013. 3
On August 8, 2012, the Commission received an e-mail and calendar from Mr. Kelly Cathey, WRD Track Operations Manager, requesting changes to the proposed CY 2013 Quarter Horse, Paint and Appaloosa race meeting as follows: Deleting September 5-6, 2013 Adding November 8-9, 2013 An e-mail, dated August 13, 2012, from the Oklahoma Quarter Horse Racing Association supported the proposed changes. These proposed changes would amend WRD s beginning and ending dates for the Quarter Horse, Paint and Appaloosa race meeting to September 7, 2013 through November 9, 2013. WRD also submitted a Racetrack Gaming Operator License application. Mr. Mark Enterline, WRD Consulting General Manager, spoke on behalf of WRD. Mr. Rieger asked if there were any construction capital expenditure projects being contemplated for CY 2013 to which Mr. Enterline replied that several requests for improvements had been made. Mr. Rieger suggested that if additional discussions regarding capital expenditures were held, the refurbishing of or construction of a new test barn should be considered. Tulsa State Fair (Tulsa County Public Facilities Authority) The Tulsa State Fair (the Tulsa County Public Facilities Authority) [FMT] applied to conduct one fair race meeting: a Thoroughbred, Quarter Horse, Paint and Appaloosa fair race meeting at Fair Meadows at Tulsa, 34 race days in length, from June 6 through July 27, 2013. FMT also submitted a Recipient Racetrack Gaming License application. Mr. Ron Shotts, FMT Director of Racing, spoke on behalf of the racetrack. He began by addressing the equipment malfunctions which occurred during the 2012 race meeting and what plans had been made for the 2013 race meeting to try to ensure that those problems did not occur again. Mr. Shotts stated that the issues included in the Staff Brief regarding the outstanding Security Plan and the audited financial statements had been resolved. He reported that the Security Plan will be ready next week and the audited financial statements should be received by the Commission after September 7, 2012. 4
Mr. Shotts addressed the other areas of concern mentioned in the Staff Brief as follows: The question regarding the proposed simulcast days when live racing will not be conducted was marked wrong. There will be eleven (11) days during the race meeting when there will be simulcasting and no racing. The updated food permits are issued on a yearly basis and will be current for the meeting in 2013. The jockey insurance verification binder was sent with the application because at the time that was all the documentation FMT had. Since that time, a copy of the jockey s insurance contract was forwarded to the Commission Regarding facility improvements, new tack rooms will be built; the tote board will be reworked and new televisions by the paddock and the apron will be installed. Mr. Shotts reported that the Oklahoma Quarter Horse Racing Association requested that next year s race meeting start a week later and run a week longer. He added that FMT could not agree to the change because the Fair Board scheduled another horse show for the National Snaffle Bit Association to begin on the Wednesday after the race meeting would end on Saturday night. Mr. Shotts said that a lot of clean-up and preparation work must be done in the interim time. He noted that the FMT crews did not have enough time to complete all the work after this year s race meeting and the horse show organization was upset about it. Mr. Shotts said that, if the CY 2013 race meeting would end on a Thursday or a Friday instead of a Saturday night, he would be willing to talk with the Fair Board Staff about it but then that would eliminate the final Saturday night which historically had been the big stakes races night. Mr. Shotts also said that, if there would be a need for a make-up day early in the race meeting, Wednesday or a Sunday would be good days, noting that if the need for a make-up occurred later in the race meeting, rescheduling on a Wednesday or Sunday could be a problem. He added that, even though potential make-up days were requested in the racing license application, there could be times when FMT may need to run races on different days. Mr. Shotts requested that FMT be allowed to do that again next year if the circumstances arose as occurred this year. Mr. Justin Cassity, Executive Director of the Thoroughbred Racing Association of Oklahoma, said historically cancellations in live race dates occurred because of actions taken by the Jockeys that were not viewed as fair, leaving to the racetrack management the task of requesting alternate race days. He added that his comment was for all of the racetracks. Mr. Cassity encouraged the Commission to stop the policy of the Jockeys walking out on races whenever they choose to do so. Mr. Mike Dixon, Director of Law Enforcement, reported that his department s processing of the applications was underway as scheduled and no problems had been discovered to date. 5
Commissioner Lucas made a motion to take preliminary action to award CY 2013 racing and gaming licenses to Remington Park, Will Rogers Downs and Fair Meadows at Tulsa and direct Commission Staff to draft License Orders for continued deliberation at the October 18, 2012 meeting. Commissioner Leonard seconded the motion. The vote was as follows: Aye: Mr. Lucas, Mr. Leonard, Mr. Bowers, Mr. Burton, Mr. Carter, Mr. Savage, Ms. Goumaz Mr. Bollenbach and Mr. Kirk were absent from the meeting. The motion passed on a 7-0 vote. CONSIDERATION OF THE FISCAL YEAR 2014 AGENCY BUDGET REQUEST PROPOSAL Commission Staff presented a drafted FY-2014 [July 1, 2013 through June 30, 2014] Agency Budget Request Proposal for Commission consideration. Once approved at the agency level, the annual budget request will be forwarded to the Office of Management and Enterprise Services [formerly the Office of State Finance], Legislative Staff and Cabinet Secretary by October 1, 2012. The proposed FY-2014 Agency Budget Request prioritized the request for supplemental funding to: Restore the base from FY-2010, FY-2011 and FY-2012 appropriation reductions Cover higher costs of agency expenses [such as insurance premiums, longevity, retirement and travel] Increase compensation for Agents Increase compensation for the Executive Director due to additional responsibilities Hire pre-race veterinarians Upgrade computer equipment Hire an additional License Clerk Hire six Test Barn Assistants Upgrade the records management system Fund the agency s mandatory annual audit conducted by the Office of the State Auditor and Inspector [SA&I] and Fund the increased costs of the pari-mutuel audit contract with SA&I This was the same request as last year. It was noted that no additional funding was provided in the latest appropriation to fund any of the requests. 6
Commissioner Burton made a motion to approve the drafted FY-2014 Agency Budget Request Proposal presented and designate a 10% salary increase request for the Executive Director. Commissioner Bowers seconded the motion. The vote was as follows: Aye: Mr. Burton, Mr. Bowers, Mr. Carter, Mr. Leonard, Mr. Lucas, Mr. Savage, Ms. Goumaz Mr. Bollenbach and Mr. Kirk were absent from the meeting. The motion passed on a 7-0 vote. RECOMMENDATIONS FROM OKLAHOMA-BRED ADVISORY COUNCIL The Oklahoma-Bred Advisory Council met August 8, 2012 and forwarded the following recommendations for Commission consideration: 1. Oklahoma Quarter Horse Racing Association s Funding Request for CY 2013 Quarter Horse, Paint and Appaloosa Stakes Races at Remington Park In a July 25, 2012 e-mail, Ms. Debbie Schauf, Executive Director of the Oklahoma Quarter Horse Racing Association [OQHRA], requested a total of $690,000 in added Oklahoma-Bred funding for eight stakes races to be conducted during Remington Park s CY 2013 Quarter Horse, Paint and Appaloosa race meeting. Oklahoma-Bred payout percentages for the Oklahoma-Bred Futurity and Derby trials would be distributed as 60/20/11/6/3 to the first five finishers in each trial, and the finals would be distributed 40/17/11/9/7/5/4/3/2/2 pursuant to the conditions of those races. The payout percentages for the Sooner State, Easy Jet, and Jack Brooks stakes would be distributed as 45/25/15/10/5. The payout percentages for the Paint and Appaloosa stakes would be distributed as 50/30/20. The following chart detailed the funding request breakdown: Purse Broodmare Stallion Supplements Awards Awards Total Quarter Horse Stakes Races Sooner State Stakes $ 50,000 $ 34,000 $ 16,000 $100,000 Easy Jet Stakes $ 25,000 $ 17,000 $ 8,000 $ 50,000 Jack Brooks Stakes $ 25,000 $ 17,000 $ 8,000 $ 50,000 Remington Park Futurity $170,000 $115,600 $ 54,400 $340,000 Remington Park Derby $ 60,000 $ 40,800 $ 19,200 $120,000 Paint Stakes Race Oklahoma Paint Horse Futurity $ 5,000 $ 3,400 $ 1,600 $ 10,000 7
Purse Broodmare Stallion Supplements Awards Awards Total Paint and Appaloosa Stakes Race National Cowboy and Western Heritage Museum Stakes $ 5,000 $ 3,400 $ 1,600 $ 10,000 Mister Lewie Memorial Handicap $ 5,000 $ 3,400 $ 1,600 $ 10,000 $345,000 $234,600 $110,400 $690,000 The Oklahoma-Bred Advisory Council unanimously recommended funding from the Oklahoma Breeding Development Fund Special Account. 2. Oklahoma Quarter Horse Racing Association s Funding Request for CY 2013 Quarter Horse, Paint and Appaloosa Stakes Races at Fair Meadows at Tulsa In a July 25, 2012 e-mail, Ms. Debbie Schauf, Executive Director of the Oklahoma Quarter Horse Racing Association, requested a total of $40,000 in added Oklahoma-Bred funding for three stakes races to be conducted during Fair Meadows at Tulsa s CY 2013 Mixed Breed race meeting with the payout percentages at 45/25/15/10/5 for the Quarter Horse stakes race and 50/30/20 for the Paint and Appaloosa stakes races as follows: Purse Broodmare Stallion Supplements Awards Awards Total Quarter Horse Stakes Race Oklahoma Horsemen s Association s Quarter Horse Derby $10,000 $ 6,800 $3,200 $20,000 Paint and Appaloosa Stakes Races Oklahoma Horsemen s Association s Paint & Appaloosa Futurity $ 5,000 $ 3,400 $1,600 $10,000 Oklahoma Horsemen s Association s Paint & Appaloosa Derby $ 5,000 $ 3,400 $1,600 $10,000 $20,000 $13,600 $6,400 $40,000 The Oklahoma-Bred Advisory Council unanimously recommended funding from the Oklahoma Breeding Development Fund Special Account. 3. Oklahoma Quarter Horse Racing Association s Funding Request for CY 2013 Quarter Horse, Paint and Appaloosa Stakes Races at Will Rogers Downs In a July 25, 2012 e-mail, Ms. Debbie Schauf, Executive Director of the Oklahoma Quarter Horse Racing Association, requested a total of $30,000 in added Oklahoma-Bred funding for three stakes races to be conducted during Will 8
Rogers Downs s CY 2013 Quarter Horse, Paint and Appaloosa race meeting with the payout percentages at 45/25/15/10/5 for the Quarter Horse stakes race and 50/30/20 for the Paint and Appaloosa stakes races as follows: Purse Broodmare Stallion Supplements Awards Awards Total Quarter Horse Stakes Race Oklahoma Horsemen s Association s Mystery Futurity $10,000 $ 6,800 $3,200 $20,000 Paint and Appaloosa Stakes Race Lorelei Derby $ 2,500 $ 1,700 $ 800 $ 5,000 Appaloosa Stakes Race Cricket Bars Appaloosa Futurity $ 2,500 $ 1,700 $ 800 $ 5,000 $15,000 $10,000 $5,000 $30,000 The Oklahoma-Bred Advisory Council unanimously recommended funding from the Oklahoma Breeding Development Fund Special Account. Commissioner Leonard noted a discrepancy in the stakes races held at the CY 2011 Will Rogers Downs s Mixed Breed race meeting. Rather than designating at least 10% of Oklahoma-Bred funds for stakes races as required in Rule 325: 75-1-15, Distribution of Funds for Oklahoma-Bred Pari-Mutuel Races, only 7.18% had been requested. Ms. Debbie Schauf, Executive Director of the Oklahoma Quarter Horse Racing Association (OQHRA), explained that the Oklahoma Horsemen s Association s (OHA) Oklahoma-Bred Futurity and Derby moved from Blue Ribbon Downs to Will Rogers Downs in CY 2010 after the closure of Blue Ribbon Downs in November, 2009. She added that last year, the OQHRA moved the Derby back to Fair Meadows and ran the only Futurity at Will Rogers, thus reducing the Oklahoma-Bred funding percentage at WRD. Ms. Schauf said that the OQHRA was aware of the shortfall at WRD. She added that there was not enough Oklahoma-Bred money so that the OQHRA decided to put the money in all the races and set the levels. She said that the OQHRA Board voted August 22, 2012 to request that the Advisory Council recommend increasing the Oklahoma-Bred money for the CY 2013 OHA Oklahoma-Bred Futurity to an additional $25,000 for the Mystery Futurity. Commissioner Lucas asked Ms. Schauf why Participating Tribal Funds [PTF] were not used to correct the shortage. She replied that the PTF money could have been increased for the Paints and Appaloosas. Ms. Schauf added that the 7.18% did not include the allowance payment made to the overnight purse level for all stakes races, handicaps and overnight races. Ms. Schauf said that the inclusion of these funds would reflect that an additional $3,000 to $4,000 had been added so that the actual percentage earmarked for stakes races would meet the 10% rule. 9
Commissioner Lucas suggested that Commission Staff check the percentage of Oklahoma-Bred funding earmarked for stakes races to be certain it meets the requirement in Rule 325:75-1-15. Mr. Rieger agreed that would be done. Chairwoman Goumaz added that the Commission representatives on the Oklahoma- Bred Advisory Council could handle the oversight. Commissioner Leonard made a motion to approve all recommendations from the Oklahoma-Bred Advisory Council with no objection by any Commissioner to the consideration of three funding requests as presented. Commissioner Lucas seconded the motion. The vote was as follows: Aye: Mr. Leonard, Mr. Lucas, Mr. Bowers, Mr. Burton, Mr. Carter, Mr. Savage, Ms. Goumaz Mr. Bollenbach and Mr. Kirk were absent from the meeting. The motion passed on a 7-0 vote. REMINGTON PARK S REQUEST FOR OKLAHOMA-BRED FUNDING FOR CY 2012 THOROUGHBRED STAKES RACES In an August 9, 2012 document, Mr. Mike Shamburg, Director of Racing at Remington Park, requested Oklahoma-Bred funding for eighteen stakes races to be run during Remington Park s CY 2012 Thoroughbred race meeting with the payout percentages at 50/30/20. The funding request details included the following breakdown: Purse Broodmare Stallion Supplements Awards Awards Total Red Earth Stakes $ 20,000 $ 13,600 $ 6,400 $ 40,000 Remington Park Turf Sprint Stakes $ 20,000 $ 13,600 $ 6,400 $ 40,000 Tishomingo Stakes $ 20,000 $ 13,600 $ 6,400 $ 40,000 Te Alta Stakes $ 20,000 $ 13,600 $ 6,400 $ 40,000 Ladies on the Lawn Stakes $ 20,000 $ 13,600 $ 6,400 $ 40,000 Oklahoma Classics Sprint Stakes $ 15,200 $ 10,336 $ 4,864 $ 30,400 Oklahoma Classics Juvenile Stakes $ 12,000 $ 8,161 $ 3,839 $ 24,000 Oklahoma Classics Distaff Sprint Stakes $ 10,200 $ 6,936 $ 3,264 $ 20,400 Oklahoma Classics Lassie Stakes $ 12,000 $ 8,161 $ 3,839 $ 24,000 Oklahoma Classics Distaff Stakes $ 17,000 $ 11,561 $ 5,439 $ 34,000 Oklahoma Classics Cup Stakes $ 22,000 $ 14,961 $ 7,039 $ 44,000 Oklahoma Classics Distaff Turf Stakes $ 15,200 $ 10,336 $ 4,864 $ 30,400 Oklahoma Classics Turf Stakes $ 15,200 $ 10,336 $ 4,864 $ 30,400 Silver Goblin Stakes $ 20,000 $ 13,600 $ 6,400 $ 40,000 Jim Thorpe Stakes $ 20,000 $ 13,600 $ 6,400 $ 40,000 Useeit Stakes $ 20,000 $ 13,600 $ 6,400 $ 40,000 Oklahoma Stallion Stakes $ 10,000 $ 6,800 $ 3,200 $ 20,000 Oklahoma Stallion Stakes-Fillies $ 10,000 $ 6,800 $ 3,200 $ 20,000 $ 298,800 $ 203,188 $ 95,612 $ 597,600 Chairwoman Goumaz noted that this request had not been submitted to the Oklahoma- Bred Advisory Council because it was not submitted in a timely manner for discussion at 10
the Council s August 8, 2012 meeting and therefore it was brought directly to the Commission for approval. Mr. Constantin Rieger, Commission Executive Director, noted that the Thoroughbred race meeting had a different payout than the percentages submitted. He added that the Thoroughbred payout provided 45% to each side (22.5% for purses and 22.5% for breeders) and that payout was then paid to the horsemen 50/30/20 for first, second and third. In response to a question by Commissioner Leonard about the timing of the request, Mr. Justin Cassity, Executive Director of the Thoroughbred Racing Association of Oklahoma (TRAO), said that the submission for the funding request was due to the Racing Secretary position at Remington Park being vacant for several months after the end of the CY 2012 Quarter Horse, Paint and Appaloosa race meeting. Mr. Cassity added that the proposed added funds for the stakes schedule had TRAO approval. Commissioner Lucas made a motion to approve the Oklahoma-Bred funding recommendation for eighteen (18) Thoroughbred stakes races to be run at Remington Park s CY 2012 Thoroughbred race meeting with clarifications made by Mr. Rieger. Commissioner Bowers seconded the motion. The vote was as follows: Aye: Mr. Lucas, Mr. Bowers, Mr. Burton, Mr. Carter, Mr. Leonard, Mr. Savage, Ms. Goumaz Mr. Bollenbach and Mr. Kirk were absent from the meeting. The motion passed on a 7-0 vote. CY 2013 COMMISSION MEETING DATES Commission Staff recommended that the Commission consider scheduling eight monthly meetings in CY 2013 for the months of January, February, March, May, June, August, October and November. The proposed CY 2013 meeting dates would be: January 24, February 21, March 19, May 16, June 20, August 22, October 17 and November 21. Ms. Debbie Schauf, Executive Director of the Oklahoma Quarter Horse Racing Association, asked that the Commission consider eliminating the June meeting and replacing it with a July meeting. Commissioner Savage made a motion to approve the proposed eight CY 2013 Commission meeting dates as proposed. Commissioner Bowers seconded the motion. The vote was as follows: 11
Aye: Mr. Savage, Mr. Bowers, Mr. Burton, Mr. Carter, Mr. Leonard, Mr. Lucas, Ms. Goumaz Mr. Bollenbach and Mr. Kirk were absent from the meeting. The motion passed on a 7-0 vote. REPORTS Chairwoman Goumaz reported that the Commission s FY-2013 appropriations level was $2,072,167, representing a standstill appropriation after three consecutive years of budgetary reductions. ANY MATTER NOT KNOWN ABOUT OR WHICH COULD NOT HAVE BEEN REASONABLY FORESEEN PRIOR TO POSTING THE AGENDA There was no new business that could not have been foreseen prior to the posting of the agenda. ANNOUNCEMENTS Chairwoman Goumaz made the following announcements: Remington Park s 67-day Thoroughbred race meeting began on Friday, August 10, 2012. Will Rogers Downs s 28-day Quarter Horse, Paint and Appaloosa race meeting began on Saturday, August 25, 2012 with a non-pari-mutuel race day for trials; the first pari-mutuel race day is scheduled Friday, September 8, 2012. The Commission s next two meetings October 18, 2012 and November 15, 2012 will be held at Remington Park. ADJOURNMENT By acclamation, the Commission meeting was adjourned at 11:08 a.m. 12