TRPB TOTE SECURITY SYSTEM FREQUENTLY ASKED QUESTIONS 1. Who is TRPB? 2. What is the TRPB Tote Security System (TSS)? 3. Why is TSS important? 4. How does TSS work? 5. Is participation in TSS mandatory? 6. With regard to TSS, what is the definition of retail association? 7. What benefits do retail associations receive for participating in TSS? 8. What is the cost to a retail association to participate in TSS and how is this cost determined? 9. What is the cost to a non-tra host racetrack to participate in TSS as a producer of racing content? 10. How am I billed? 11. What role does my tote company play in all this? 12. Do I need to purchase equipment or software to participate in TSS? 13. Are regulatory agencies involved in TSS? 14. What should I do next to ensure access to TRA-member Host track wagering pools? 15. Who can I contact with questions regarding TSS? 1
1. Who is TRPB? TRPB is a wholly-owned subsidiary of the Thoroughbred Racing Associations of North America (TRA), which is comprised of 41 thoroughbred racetrack associations located throughout North America. Created in 1946, and headquartered in Fair Hill, Maryland, TRPB provides unique services encompassing racetrack security, racing-related investigations, corporate due diligence and risk management, information management, wagering analysis and tote security. The services provided by TRPB are designed to protect the legitimate business interests of TRAmember racetrack associations, and foster and maintain public confidence in the sport and business of thoroughbred racing. 2. What is the TRPB Tote Security System (TSS)? TSS is a redundant communications and reporting system parallel to but independent from Inter- Tote System Protocol (ITSP), the communications network which currently transmits important race day control and wagering pool information between a race track hosting an event and authorized retailers throughout the entire pari-mutuel network. Although ITSP is an invaluable communications network which has served the racing industry well, its function does not lend itself toward necessary wagering system security improvements. TSS will provide Host racetrack associations with important capabilities not presently available to them through ITSP. Upon being fully-implemented across the entire pari-mutuel network, TSS will enable a Host racetrack association to: Better-manage central Race Day Control security and transparency, and verify execution of all essential Race Day Control functions from every tote hub within its parimutuel network; Secure its stop-betting control, and ensure all commands are immediately disseminated throughout the simulcast network; Authenticate each simulcast association s participation in their races; Create a wagering transaction database enabling Host to audit bet detail, including the ability to track Pick-n pools on a leg-by-leg basis. In addition to these important transparency and integrity features, TSS s point-of-presence on tote systems throughout the pari-mutuel retail network will enable the production of real-time decimal odds (RTDO) for the Win pools, based upon a dollar wager, which will provide faster and more-easily understood information for the wagering customer to calculate expected payoffs. The system is designed for a graduated response in the production of RTDO, whereby the refresh frequency of odds will quicken as a race s off time approaches, to within seconds starting at two minutes to post. 2
3. Why is TSS important? The impetus for TSS stemmed from a perceived lack of public confidence in the current tote system, resulting in occasional failures of Host racetrack wagering pools to close prior to the start of a race. Late-odds shifts inherent within Inter-tote System Protocol (ITSP), fueled this perception and exacerbated the frustration of bettors. Regulators have repeatedly requested vendor-provided wagering monitoring systems, which to date have proven to be both costly and ineffective from a network perspective. 4. How does TSS work? TSS, through proprietary software developed by TRPB s lead technology vendor, The Jockey Club Technology Services, will capture specific data provided by each tote system. The state-of-the-art TSS Stop-Betting device, a standardized component of TSS having visual and audible cues, will communicate directly to the host tote system when activated by a racing official. The host tote system will disseminate the stop-betting command via Inter-tote System Protocol (ITSP), as it does currently. The Stop-Betting device will also transmit to the TSS central system, located at The Jockey Club s Network Operation Center, Lexington, Kentucky. This close-betting command will be broadcast to Host and all guest tote systems. TSS proprietary software will provide feedback throughout the system for stop-betting confirmation and audit purposes. 5. Is participation in TSS mandatory? P articipation in TSS is a requirement for retail associations offering pari-mutuel wagers on thoroughbred races hosted by TRA racetrack associations. Additionally, a number of racetracks which currently are not TRA-member associations have expressed to TRPB their interest in acquiring the benefits that TSS provides. As part of their agreement with TRPB to receive these benefits at cost, each non-tra member racetrack association will be required to include language in its simulcast agreement making integration within TSS a condition for any retailer to access their wagering pools. 6. With regard to TSS, what is the definition of retail association? TRPB defines a retail association as any organization which sells pari-mutuel wagers on horse racing content. Examples of a retail association would include a racetrack conducting simulcasting, a n OTB, an ADW, and a casino racebook. For contractual and billing purposes, a retail association may be comprised of more than one retail location. For example, a racetrack association having multiple OTBs within its wagering network would be considered by TRPB to be a single retail association. Similarly, an OTB network within the same state or province, and under the same ownership, would be considered by TRPB to be a single retail association. As detailed later within this document, the TRPB Tote Security Retailer s Agreement will clearly identify the retail location(s) for which licensure under the Agreement is extended. 3
7. What benefits do retail associations receive for participating in TSS? Participation on the TSS network provides the retailer with stop-betting redundancy, enabling the retail association to comply with the Host racetrack s contractual requirement that the retail association not accept wagers after the start of a race. Provisions within most simulcast contractual agreements state that it is the retail association who is financially liable for accepting wagers after the start of a race, notwithstanding a failure within the Host racetrack s communication network or within ITSP. Such an occurrence necessitates the retailer to refund all wagers accepted on a race, which is both costly to the retailer and frustrating to the bettor, or else the location books the wagers and accepts the liability. Participation in the TSS network provides the retail association an opportunity to demonstrate to its customers and regulator its commitment to ensuring the integrity and transparency of pari-mutuel wagering. 8. What is the cost to a retail association to participate in TSS, and how is this cost determined? By design, the cost of developing, implementing, and maintaining TSS is borne equitably by every retailer of racing content across the entire pari-mutuel network. The monthly license fee for TSS, established by TRPB, subject to the approval of the TRA Board of Directors, is US$950. The US$950 monthly license fee entitles the retail association access to the wagering pools of all host racetracks participating on the TSS network with which the retail association has a simulcast contractual agreement. 9. What is the cost to a non-tra host racetrack to participate in TSS as a producer of racing content? As a producer of thoroughbred or harness racing content, a non-tra racetrack association may elect to enter into a Host Track Agreement to TRPB Tote Security System with TRPB, and receive the same benefits enumerated in the response to Question #2, above. Obviously, as non- TRA-member racetrack associations did not participate with TRA-member racetrack associations in their initial capitalization of this multi-million dollar initiative, a monthly fee will be assessed the non-tra member racetrack associations during their live race meeting. 10. How am I billed? Retail associations will be invoiced by TRPB, electronically and directly. The first of the month preceding the month of service, the retail association will receive an electronic invoice reflecting the time period of service being billed, charges, and instructions for payment. Payment must be made in full, and received no later than by the 15th of the month or the first business day thereafter to ensure no interruption in connectivity to TSS. The preferred method of payment is by recurring ACH payments which will be collected on the 25th of the month preceding the month of service. 4
11. What role does my tote company play in all this? AmTote International, Sportech Racing LLC, United Tote, and Las Vegas Dissemination, Inc. are vendors under contractual agreement with TRPB to develop software unique to their respective tote systems such that the technical requirements of TSS can be achieved. Thereafter, each tote company will provide ongoing support of TSS within their respective tote hubs and data centers. As each TRA and non-tra racetrack association and pari-mutuel retailer is a customer of one of the TRPB-vendor tote companies, each tote company will be designated as a 3rd-party recipient of any agreement between TRPB and any racetrack or pari-mutuel retail association regarding TSS. 12. Do I need to purchase equipment or software to participate in TSS? No. All software and devices necessary to facilitate connectivity to TSS for Canadian and American locations are provided by TRPB or its technology vendors, and included in the monthly costs assessed to retail associations and non-tra-member racetrack associations participating in TSS. International locations should contact the TRPB for more details. 13. Are regulatory agencies involved in TSS? The support and participation by regulators in the implementation of TSS throughout the North American pari-mutuel network is of critical importance. As TSS is implemented jurisdiction-byjurisdiction throughout North America, TRPB and its technology vendors will work closely with regulators to ensure compliance with all regulations. 14. What should I do next to ensure access to TRA-member Host track wagering pools? TRPB has forwarded to most retail associations a copy of the TSS Retailer s Agreement, which sets forth the terms and conditions for licensure to participate in TSS, and identifies the retail association s location(s) for which the license to participate in TSS is extended. Copies of the fully-executed Agreement will be provided to the retail association and its tote provider, with instructions for the tote company to integrate the retail association into the TSS infrastructure as soon as technically feasible. A retail association will not be invoiced by TRPB until such time as it is fully-networked into TSS. To ensure compliance with the condition set forth in Host TRA-member racetrack simulcast agreements regarding participation in TSS, and to enable its tote provider to facilitate integration into the TSS network as soon as technically feasible, it is important that the TRPB Tote Security Retailer s Agreement be executed and returned to TRPB. 5
15. Who can I contact with questions regarding TSS? To ensure a prompt response in the event you have additional questions regarding TSS, please feel free to contact TRPB at tssinfo@trpb.com. Thank you. 6