With decided reservations and citing restrictions on its authority, the Louisiana Racing Commission on Tuesday granted a conditional one-year renewal to the 10-year rolling license of Churchill Downs Inc. to conduct racing and off-track betting operations at the New Orleans Fair Grounds.
In return, CDI promised improvement in several areas.
The Kentucky company has been under fire for months from the local racing community, as well as many of the owners and trainers who for many years have used the track as their primary winter base. The critics have complained of a lack of maintenance, particularly of the turf course; the company’s alleged focus on its slots and video poker operations instead of amenities for horse-racing fans; and what is seen as officials’ attitude favoring short-term, bottom-line decisions to the detriment of the sport.
The renewal sets the racing days for the 2014-15 thoroughbred season, which begins in November, as well as the 10-day quarter horse season that begins in August. It does not include the gaming license, which is also granted by the state.
“I’m cautiously optimistic that the events which have occurred have gotten their attention,” Commissioner Thomas Grimstead, of New Orleans, said. “But we’ve heard a lot of this before.”
He said the conditional renewal was the most the commission could do.
“A flat-out denial of their license would have put us immediately in the courts, and that would have meant a protracted battle over it,” he said.
A denial would have triggered an automatic appeal that would have left CDI in control of the Fair Grounds, which it purchased out of bankruptcy in 2004. The action only extends for one year the 10-year rolling license first granted to CDI a decade ago.
Still, the action — which followed a deferral of the issue last week, when the commission requested more detailed information from CDI about its plans for the future of the 143-year-old racetrack and scheduled Tuesday’s special meeting — was seen as a significant step in what has become a contentious battle between many of the state’s horsemen and the Fair Grounds, with the commission increasingly weighing in on the side of the horsemen.
“I think we’ve received the message loud and clear,” Fair Grounds President Tim Bryant said. “We appreciate the commission working through this with us, and we’re confident we will diligently work on the conditions.
“We were obviously hoping not to have any conditions. But from my standpoint, with the additional resources which are being provided to our Louisiana operations, (I am confident) that my team and I will be able to make these improvements.”
Chief among the promised improvements is a pledge to replace, if necessary, the drainage system for the turf course, which has seen 45 percent of its races over the past two years either moved to the dirt course or canceled outright because of rain.
CDI will immediately spend some $200,000 on the turf course to try to fix problems on turns 3 and 4, with the rest of the work to be done if its architect and consultants recommend it. Last week, Bryant said he did not have authorization to spend the extra money.
In customer service, the company is promising to spend $200,000 for an infield video board to replace one that has been broken for two years.
It also will improve the repair process in the OTBs and provide more tellers during live races.
In marketing, CDI will do more to promote racing at the track along with its slots and video poker operations. It promised to hold regular handicapping tournaments and work with the New Orleans Convention and Visitors Bureau to promote tourists’ interest in the track.
Finally, CDI will work to streamline repairs in the barn area.
It will provide the commission with monthly reports on its progress in fulfilling its promises.
“We are dedicated to the future of the horse racing industry,” Bryant told the commission. “We do have a vision for the Fair Grounds. ... We look forward to making improvements to one of the most historic tracks in the country.”
CDI’s promises came along with a request for 80 racing days in 2014-15, four less than the maximum allowed by the state.
Last year, the Fair Grounds experienced a 12 percent drop in handle — the total amount wagered on races — and sometimes had to reduce purses and in some cases cancel stakes races due to the decreased revenue.
Bryant had indicated in the past that CDI would request even fewer racing days to cut down on expenses and reduce what is seen as an excess number of racing days in the state overall. He suggested Tuesday that it is time to “take a look at the entire Louisiana horse racing industry to see if there are some things to improve it as a whole.”
Commissioner Dion Young, however, put the blame for problems at the Fair Grounds on its management.
“They’ve spent more on the casino and let the racetrack slide,” he said. “Any time you lose clients, it’s hard to get them back.”
At any rate, reducing racing days, which is in the purview of the Legislature, may be problematic.
Stanley Seelig, president of the Louisiana Horsemen’s Benevolent and Protective Association, said his group would strongly oppose any such cuts, and Charlie Gardiner, executive director of the Racing Commission, said trimming days would not be politically feasible.
To acting Commission Chairman Bob Wright, the fact that all of the promised improvements are on the racing side of the operations shows where CDI’s interest has been.
“Since the day I first got on the commission, my concern is that their emphasis was on slot machines and video poker instead of racing, which is the product that allows them to have gaming,” said Wright, who was replacing Jerry Meaux as chairman after his death in an auto accident Friday. “It’s finally come to light in this past year.
“I really believe that from a business standpoint they’ve realized they can’t go too far because they may be jeopardizing their entire business in Louisiana. If we canceled their racing license, it might not be too long before they have to give up their gaming interests.”
Tuesday’s meeting was far more civil than last week’s, and Bryant appeared more contrite than he did a week ago.
Still, the meeting ended with some members still skeptical.
“The public needs to be convinced that Churchill is about racing and not just (as) a stepchild to the casino,” Grimstead said. “I voted for the license today, but if I find myself on this commission a year from now with the same problems, I’m going to vote against Churchill.
“We’ll just have to wait and see how interested they really are.”