Takter Reaction Shows How Hard it is to Run The Sport

In Harness Racing Update, driver/trainer Jim Takter was "steaming mad". As most of you who watched know, Takter, driving a longshot against two other of his stablemates, sat on the outside and did not advance, in a stakes final last weekend. This caused crawling fractions and a good old fashioned boat race. 

•  “Why should I put pace into the race? I had no reason to do that. I was screwed no matter what I did; she couldn’t even keep up anyway. This whole thing is (expletive) bull (expletive).”
  Takter said
•  “It’s upsetting because I’m a standup guy,” Takter said. “I do everything right in this sport. Go after these scumbags doing all this dirty garbage.”

 Jim doth protest too much. No one is calling him a crook. No one is saying he deliberately boxed in a challenger. All people are saying is he did not advance with a horse on the outside - which is against the rules of racing - and because he had two others in the race, including the leader who clearly benefited, the perception for the sport is tarnished.

Jim is so upset, he says if the rules are changed he will sue.

The above shows how hard it is to police the sport, for the benefit of the wagering public. In Major League Baseball, a guy taking a supplement that you and I can take can be booted out of baseball. He's not a drug addict, but it looks bad. A dude who smokes a joint - legal in some states - as an NFL player is treated differently than a guy on the corner. He's not a drug addict either, but it can cost him hundreds of thousands of dollars in suspensions.

Jim is not a crook, he just did not advance on the outside with a horse, which causes an issue for the $5 million or so going through the betting windows on Saturday. He should be fined. And he should, along with anyone else in the same position, learn from that mistake.

Horse Racing's Data Bog & The Decisions It Makes

With most of us, at work in our jobs or while we are handicapping the races, we need data to make a decision. If we do "x" we need to know what happens to "y". Reading a couple of headlines it makes me wonder how racing does the same thing. I guess the short answer is, it probably doesn't.

As Alan at LATG talked about today in his Saratoga notes, NYRA has increased admission prices to the storied track, but they've also changed their policy on "spinners" who buy more than one admission for free stuff.

• Excessive spinning will be limited to two extra vouchers at a time, in an attempt to prevent hoarding and to give more people a chance to get the items; and the extra vouchers sold will not count towards attendance.  So the phony crowd figures - to me one of the treasured traditions of Saratoga - will become a thing of the past. 

So, if racing tries to answer a question like "did a fairly large percentage admission fee increase hurt attendance?" they can't. The old data is bad, they changed two variables not one, and even worse, it's probably planned anyway. When attendance goes down it's because there "were no spinners", so of course it went down.

Ass covering, maybe. But worse, no one learns anything about proper policy or revenue generation.

It's even worse, like we see with Churchill Downs. Although the field size issue has been debunked dozens of times (Churchill's field size is down almost exactly what horse racing's is in 2014, yet their handle was down by 800% or 900% more than national handles), it still is thought of as "the issue". This is bad because the real problems and the real data points that need action, are overlooked. As Matt Hegarty tweeted the other day:

June CD handle figs -- down 28% -- presented to comm. No commissioner asks why, same as May mtng. #wheelsonbus
— Matt Hegarty (@DRFHegarty) July 16, 2014

The Kentucky Commission, approved taking money away from drug testing to help CDI purses yesterday, probably due to the fact "that field size issue" is a real bear.

Even when they have data points that make sense - e.g field size down average, handle below average, so the takeout up is the only major factor left to attribute the losses to) - they don't use them.

Does raising admission fees at Saratoga matter? Who knows. NYRA has a built in excuse and it will be hard to measure its benefit or detriment to revenues either way. Internally they probably will, but if the policy looks like a dud it's unlikely they will broadcast it.

At Churchill, should they lower the takeout rate back to try and make more money, and get back customers they've lost? Who knows. Just take $125,000 out of drug testing to give them more for purses please. Purses did crappy last meet.

Horse racing is frustrating. It trudges along in a data bog, making decisions that either already fit a prescribed political agenda, represent the path of least resistance, or use the data in a way which makes little sense in the first place.

Doubles, Doubling Down, Expectations & Other Monday Notes

The "Del Mar Double Caper" was in full effect the last week. As you may know, double takeout was set at 18% for the Santa Anita and Los Al meets, and this was planned to be carried over the rest of the year. Now, after some negotiation with the horsemen and owners, double takeout is being set at 20%, a 2.68% reduction from last year, but a 2% increase from earlier this year at other So Cal tracks.

Chris, who has run racetracks for years, summed it up on twitter:

This entire 18% rake reduction debate on DD is amusing. They act like something is being given away.
— Christopher Schick (@jogburger) July 13, 2014

If you don't quite understand his point, maybe the head of the California Lottery can help. They lowered their takeout percentage on scratch tickets and ended up making more money:

"Increasing the prize payout percentage improves the product's value to the consumer, provides us with a powerful message that gets consumer attention, and gives us a tool to drive sales and profits. A relatively small increase in prize payout percentage can be leveraged into a much more significant increase in top-line sales.

Although the increase in prize payout percentage leaves a smaller percentage to be transferred to education, the total dollars going to our beneficiary goes up. And at the end of the day, you can spend a dollar, but you can't spend a percentage. So these changes have resulted in increased funding to education and that's what our constituents care most about and the reason the Lottery was created in 1984."

In horse racing, because it has lived with a pricing mechanism that is not only average cost priced, but worse than that, arbitrarily set at false levels, when a margin goes up, horsemen and others believe that they will make more money. When in fact, they are probably losing more money.

Chris's comment hit that right on the head.

There is a ton of talk about the Dumb Ass Partners doubling down with their requests for appearance fees for their horse, California Chrome. Although this is much ado about nothing, in my view, this is what a lot of people have been clamoring for in the business - more revenue outside purses and stud fees for the stars of the game.

Everything, also in my view, comes from the lack of structure in horse racing (or a structure built for another time). In the NFL, appearance fees and memorabilia etc from active players is run out of the players association. Some of the revenues go back to help the sport, and the players. In this case, the owners of the horse take the insurance and shipping risk, but the racetrack attendance benefits. Of course one can be altruistic about this, but if there was a proper system set up for appearances by star horses, I think everyone would be better off.

Speaking of systems, horse racing business is led by an act created in 1978 - the Interstate Horse Racing Act. Owners don't like it much because it gives too much power to trainers, and horseplayers don't like it much because it is a barrier to lowering takeout, or getting more customer centric things done for them. I agree, it has to be scrapped and something new has to replace it, like this opinion states. 

There was a letter to the editor to Harness Racing Update this week from a Pet Rock fan who didn't take kindly to the hype of Captaintreacherous last season.  The writer does make some good points, primarily, when you race a restricted crop, it depends on the year you're born a lot of the time. If Pet Rock was a three year old last season, or in other years with the lack of a deep crop, he'd probably have won a lot of races,  and been hyped himself. Conversely, if the Captain raced in the super deep Pet Rock year, the world's worst handicapper could tell you he wasn't going to win 90% of his races.

The owners of ILuvthenitelife felt similar last year, and I agreed with them. Their filly was a monster, but because the Captain was racing and winning races, she was an afterthought. When we look at this season, we see how things have worked out and look at it through a different lens. ILTN was beating up on Shebestingin and Somewhereovertherainbow like they were not in the same species. This year those two fillies have done well in the older division. It's likely, barring injury, she would be a four year old superstar against some tough older mares. She was a quality animal, like Pet Rock, but because she was overshadowed by a winning horse, she got little respect. It was not her fault, it was based solely on circumstance and the year she was born.

This is why I feel it's imperative horses race longer. We get to see who is a great horse and who is a good horse. Restricted divisions can make some look like good horses who are actually great horses, and some look like great horses who are actually good horses.

Have a nice Monday everyone.