Yet another track that is dead to me

[cmorioles]

Sounds like a great strategy to me. Let's screw our customers so we can get slots, then we don't need our customers. How can anybody think that is ok if you like racing?

[Kasept]

Originally Posted by cmorioles

Sounds like a great strategy to me. Let's screw our customers so we can get slots, then we don't need our customers. How can anybody think that is ok if you like racing?

They've established that their interest in racing is largely limited to their biggest event(s). They want to maximize the Downs as an entertainment venue.

Who says that anyone is supportive of how they operate?

When you're put out by the corporate sensibility running CDI, the horsemen's position when they exercise their options and tracks run by someone that clearly loves the game and spends his own money, I'm not sure what you have left..

[cmorioles]

Originally Posted by Kasept

They've established that their interest in racing is largely limited to their biggest event(s). They want to maximize the Downs as an entertainment venue.

Who says that anyone is supportive of how they operate?

When you're put out by the corporate sensibility running CDI, the horsemen's position when they exercise their options and tracks run by someone that clearly loves the game and spends his own money, I'm not sure what you have left..

When you say you don't blame them, I took at as support. Sorry if that is wrong, but that is how it read to me.

Frankly, I'm sick of hearing about the need for enhanced gaming! We've all heard the arguments for it, and how it helps the sport, and it is all complete bullcrap. All it does is allow the sport to continue without fixing any of the real problems. I, for one, hope they NEVER get slots.

[Kasept]

Originally Posted by cmorioles

When you say you don't blame them, I took at as support. Sorry if that is wrong, but that is how it read to me.

Frankly, I'm sick of hearing about the need for enhanced gaming! We've all heard the arguments for it, and how it helps the sport, and it is all complete bullcrap. All it does is allow the sport to continue without fixing any of the real problems. I, for one, hope they NEVER get slots.

I said I don't blame them for being frustrated with Frankfort and nearly a decade of inactivity. Try approaching this from a practical standpoint where you're in this business in KY watching as Iowa, Indiana, Pennsylvania and now even Ohio syphon off your horse population with their gaming-enhanced purses. What are you supposed to do? If you say, what does Keeneland do, note that Churchill doesn't have a horse sales business to underwrite their racing program. It's not a defense for raising takeout. It's an explanation of the environment in which the decision was made.

[cmorioles]

Originally Posted by Kasept

I said I don't blame them for being frustrated with Frankfort and nearly a decade of inactivity. Try approaching this from a practical standpoint where you're in this business in KY watching as Iowa, Indiana, Pennsylvania and now even Ohio syphon off your horse population with their gaming-enhanced purses. What are you supposed to do? If you say, what does Keeneland do, note that Churchill doesn't have a horse sales business to underwrite their racing program. It's not a defense for raising takeout. It's an explanation of the environment in which the decision was made.

I do understand why they want slots. I'm from Maryland, grew up on Maryland racing, so I know what happens when all the neighboring states have slots. It sucks. But I also know slots are nothing but a short term cure and getting them does nothing to help horseplayers, absolutely nothing.

Not only don't they help horseplayers, they generally make things worse.

[Cannon Shell]

Originally Posted by cmorioles

I do understand why they want slots. I'm from Maryland, grew up on Maryland racing, so I know what happens when all the neighboring states have slots. It sucks. But I also know slots are nothing but a short term cure and getting them does nothing to help horseplayers, absolutely nothing.

Not only don't they help horseplayers, they generally make things worse.

CDI's interest in slots in KY isnt chiefly to enhance its Churchill downs racing program, it wants them to add to its bottom line period. What makes Churchill Downs (the track) different than virtually every other racetrack that might gets slots is they also have a wildly profitable property as well (Derby/Oaks weekend). While there is little doubt that CDI even remotely "cares" about its racetrack businesses as they have demonstrated, the facts are as Steve outlined, the casino companies and their lobbyists in surrounding states have KY's legislature in their pockets and CDI is obviously willing to maneuver to counter that in anyway possible with racing and its players an afterthought. I'm pretty sure that if Casino's were to be ok'ed in KY that CDI still has a large interest in Ellis's cut as part of the deal with Geary as well.

I read this weekend that because of the addition of the September meet and the avg on track handle dipping below 1.2 million not only can CD raise takeout but also now qualifies to pay a lower pari-mutual tax of 1.5% as opposed of the old rate of 3.5% on bets made in the state. So essentially it seems like they have raised rates while at the same time getting a 2% tax break.

They dont care about racing period. They have invested in racing properties only as a potential leading to racinos/casinos. I expect that once Duchossois passes and there isnt a change from the current chances for a casino in IL that AP will be on the market soon. If Calder isnt profitable from a casino standpoint, they will be on the block as well. If twinspires doesnt remain profitable enough they will dump that too though that is unlikely to happen.

Let's face it horsemen are higher on CDI's list than horse players simply because they are forced to be contractually and via the Wire act. But make no mistake they will throw us under the bus as quickly as they are able to. Like I've said before I dont blame anyone for not betting on their signal. Just don't kid yourself into believing it matters to them.

[freddymo]

Originally Posted by Cannon Shell

CDI's interest in slots in KY isnt chiefly to enhance its Churchill downs racing program, it wants them to add to its bottom line period. What makes Churchill Downs (the track) different than virtually every other racetrack that might gets slots is they also have a wildly profitable property as well (Derby/Oaks weekend). While there is little doubt that CDI even remotely "cares" about its racetrack businesses as they have demonstrated, the facts are as Steve outlined, the casino companies and their lobbyists in surrounding states have KY's legislature in their pockets and CDI is obviously willing to maneuver to counter that in anyway possible with racing and its players an afterthought. I'm pretty sure that if Casino's were to be ok'ed in KY that CDI still has a large interest in Ellis's cut as part of the deal with Geary as well.

I read this weekend that because of the addition of the September meet and the avg on track handle dipping below 1.2 million not only can CD raise takeout but also now qualifies to pay a lower pari-mutual tax of 1.5% as opposed of the old rate of 3.5% on bets made in the state. So essentially it seems like they have raised rates while at the same time getting a 2% tax break.

They dont care about racing period. They have invested in racing properties only as a potential leading to racinos/casinos. I expect that once Duchossois passes and there isnt a change from the current chances for a casino in IL that AP will be on the market soon. If Calder isnt profitable from a casino standpoint, they will be on the block as well. If twinspires doesnt remain profitable enough they will dump that too though that is unlikely to happen.

Let's face it horsemen are higher on CDI's list than horse players simply because they are forced to be contractually and via the Wire act. But make no mistake they will throw us under the bus as quickly as they are able to. Like I've said before I dont blame anyone for not betting on their signal. Just don't kid yourself into believing it matters to them.

It's been a nice equity to own and they have a responsibility to do what is fundamentally in the best interest of share holders. While a issue for race fans and gamblers and the the entirety of the sport, it means zero to the share holders. Doomed

[10 pnt move up]

Originally Posted by Cannon Shell

CDI's interest in slots in KY isnt chiefly to enhance its Churchill downs racing program, it wants them to add to its bottom line period. What makes Churchill Downs (the track) different than virtually every other racetrack that might gets slots is they also have a wildly profitable property as well (Derby/Oaks weekend). While there is little doubt that CDI even remotely "cares" about its racetrack businesses as they have demonstrated, the facts are as Steve outlined, the casino companies and their lobbyists in surrounding states have KY's legislature in their pockets and CDI is obviously willing to maneuver to counter that in anyway possible with racing and its players an afterthought. I'm pretty sure that if Casino's were to be ok'ed in KY that CDI still has a large interest in Ellis's cut as part of the deal with Geary as well.

I read this weekend that because of the addition of the September meet and the avg on track handle dipping below 1.2 million not only can CD raise takeout but also now qualifies to pay a lower pari-mutual tax of 1.5% as opposed of the old rate of 3.5% on bets made in the state. So essentially it seems like they have raised rates while at the same time getting a 2% tax break.

They dont care about racing period. They have invested in racing properties only as a potential leading to racinos/casinos. I expect that once Duchossois passes and there isnt a change from the current chances for a casino in IL that AP will be on the market soon. If Calder isnt profitable from a casino standpoint, they will be on the block as well. If twinspires doesnt remain profitable enough they will dump that too though that is unlikely to happen.

Let's face it horsemen are higher on CDI's list than horse players simply because they are forced to be contractually and via the Wire act. But make no mistake they will throw us under the bus as quickly as they are able to. Like I've said before I dont blame anyone for not betting on their signal. Just don't kid yourself into believing it matters to them.

Racing has no one to blame for the situation you have outlined, anyone could have seen this coming way before the first slot machine was installed.

Reading all the information it sounds like a sound business decision, if track revenue really is meaningless and this is just a means to an end who cares about track takeout related dynamics. They want slots and if thats the bottom line then cant blame them.

Sucks though to be an actual player who bets real money.

Why should someone do that?

[ScottJ]

Originally Posted by Kasept

I said I don't blame them for being frustrated with Frankfort and nearly a decade of inactivity. Try approaching this from a practical standpoint where you're in this business in KY watching as Iowa, Indiana, Pennsylvania and now even Ohio syphon off your horse population with their gaming-enhanced purses. What are you supposed to do? If you say, what does Keeneland do, note that Churchill doesn't have a horse sales business to underwrite their racing program. It's not a defense for raising takeout. It's an explanation of the environment in which the decision was made.

Steve,

Thank you for the intelligent discourse and responses in this thread. Obviously, this discussion could descend into an ugly discussion and the community here at Derby Trail has kept the conversation on point.

Earlier in this thread in our first exchange, you mentioned that CDI has an obligation to its shareholders. You are absolutely correct and have succinctly stated CDI's number one problem as a corporate entity. Horse racing and gaming is their vehicle to render shareholder value, their mission. Having doubled their share price in the last three years, you could argue that CDI has been successful.

Our problem is that the sport itself is not their underlying mission. This is what creates the tension between horse enthusiasts and the actual product on offer by CDI. Your messages explain that they are raising takeout in order to potentially force the gaming discussion within the state. In the near-term, this helps neither racing nor the shareholders, but the longer term view is being taken with the shareholder in mind.

One could argue that CDI is holding excessive capacity : excessive real estate holdings and conducting an excessive number of races. These holdings are often gambles on favorable gaming legislation rather than offering a managed horse racing business model.

Is CDI managing their capacity and product effectively? Should they be forced to unlock the embedded value of these holdings either through facility/real estate sales or increasing demand (by decreasing supply). Running the September meeting created further dillution of their overall product and provides a platform to argue about overall supply.

Arguing that CDI is under the gun in Kentucky due to gaming in neighboring states provides an unnecessary free pass to the management team. Clearly, this has not impacted their share price escalation.

As a shareholder that was handed a take-out rate as the solution to business problems on the horizon, I would question why the company would not create a 25-30% across the board rake on all bets if that is indeed the correct business solution.

Ultimately, Keeneland understands its business - horse sales and boutique meetings - and the variables involved in those models. Rather than playing for gaming revenue, the Keeneland company gives the impression of a better managed horse racing entity within the rules that bound Kentucky.

This brings us back to my opening comment where I have decided not to wager on their centerpiece event this year. There are plenty of three year old events during the year, many likely better positioned in the summer months.

As we learned from Wall Street, Lehmans and Bear Stearns were allowed to fail - perhaps horse racing has reached the point where some major players must be allowed to fail as opposed to being propped up from the horse player.

Sincerely, Scott

[tector]

CDI and NYRA make Frank Stronach look like the Jesus Christ of major track owners/operators.

Aside from a few big days, CD racing is not all that in any event. They have killed CRC and are doing the same to FG.

[10 pnt move up]

Originally Posted by cmorioles

When you say you don't blame them, I took at as support. Sorry if that is wrong, but that is how it read to me.

Frankly, I'm sick of hearing about the need for enhanced gaming! We've all heard the arguments for it, and how it helps the sport, and it is all complete bullcrap. All it does is allow the sport to continue without fixing any of the real problems. I, for one, hope they NEVER get slots.

You have a bigger voice than I do but thats been my argument for a long while.

Very bad this crutch they are using.