Dear Mr. Todd

As the committee’s thoroughbred representative could you please pass this note on to the other committee members………. 

I am going to assume that over the next 90 days or so the “Horse Racing Management Committee” will be gathering facts and planning on just how the horse racing industry allocations will look for 2012.

Here is my take on the matter…………

Reallocate the allocations. The allocations to the Thoroughbred and Standardbred sectors need adjustment. At present the Thoroughbred side receives 10.01 million dollars while the Standardbreds receive 6.66 million. What I would like is that you take $922,000 from the Standardbred side and move it to the Thoroughbred side. Is that fair you say. HELL NO! It should be far greater considering that the net we contribute to the bottom line is far greater. It is more like 7 to 1 then the ratio of 2 to 1 that I am asking for. Next I would like to take $750,000 casino revenue from Great Canadian’s allocation and give 50% to each breed. We then would need to raise the cap to $10,750,000 so we would still also get the $4,000,000 guarantee from the government. Why you ask? Because by my calculations and digging and reasonable assumptions I have both of the casinos at each track generating approximately $35 million dollars after expenses. That’s every year! $35 million dollars! Now I am sure that Great Canadian and the BC Lottery Corporation will tell us that a proper and fair return on capital is required and that a lot of money is spent on advertising bringing the people into the casino. So the $35 million or so that Great Canadian and the BC Lottery Corporation share is fair. That’s what they will say. Well I don’t quite agree on that. As I would also like to think that when that individual comes to the racetrack and visits the casino that maybe horses such as Spaghetti Mouse, Teide, and St. Liam’s Halo help draw them to the racetrack and then into the casino. As owners we take the monetary risk with our horses and also need a return on capital. So all I am asking for is for a very minor allocation adjustment comparatively speaking.

Now with regards to the 16.74 million that Great Canadian receives as their allocation or did after I adjusted it for them. The Standardbreds and the Thoroughbreds are both held to a measure of accountability by our handle. Some components of our handle are difficult to manage such as the fluctuating US/CAD Dollar. Why did Great Canadian/Horse Racing Management Committee not protect our US Dollar handle percentage by hedging with a futures contract? Airlines hedge on the fluctuating cost of jet fuel. Oil refineries hedge on the cost of a barrel of oil. Why didn’t we? It is not difficult to do.

Further, why after 4 years in operation is our casino share between the two breeds only approximately $6,000,000. Why is it not $12,000,000 or more?  With the expertise that Great Canadian and the BC Lottery Corporation have why are they not also held to a measure of accountability? Why is their allocation not knocked back for not producing the casino revenues that the BC Lottery projected several years ago? Great Canadian as one of the largest operators of Casinos in Canada has some very bright people working for them. Where are they?
And why is the thoroughbred allocation “makeup” published but not that of Great Canadian. Why can we not see the “makeup” of the 16.74million now of course $15.99million?

Now the last item…………. The $800,000 Advertising Fund.

I require some clarity here. Is that $800,000 gross or net after advertising commissions? And if the BC Lottery Corporation is administering this fund are there advertising commissions involved? And what is the split on the actual advertising between both breeds? Is it 50/50?

Here is what I would like to see. First off the fund of $800,000 is not enough. It should be $1,400,000. And the split should be 80/20 in favor of the Thoroughbreds. So take $320,000 from the Thoroughbred allocation and $80,000 from the Standardbred side and move these amounts into the advertising fund. And finally take $200,000 from Great Canadian and add that to the fund. That makes it a $1,120,000/$280,000 split between the breeds. Now what to do with the fund. For one thing do not spend one dime asking people to come to the track on an April Friday night when it is 44 degrees out and raining. Until the horsemen/horsewomen receive 50 cents for every hotdog sold or 75 cents for every beer consumed ……..stop!!!!!

The bulk of advertising needs to go to two areas.

1. Every race day, in the morning Vancouver Sun/Provence newspaper, Friday, Saturday, Sunday and holiday racing there needs to be an area (and always the same area) reserved for horse racing in the sports section and it needs to be a full page. Here there should be entries, chart results, carryover amounts, stories, best bets, horses to watch, works, advertisements and so forth. Every race day morning! The Vancouver Sun/Province has a weekly readership of 1,302,100 (print & online). The BC Lottery Corporation is the largest purchasers of print media in the Province. Use their resources. Start telling the public in a meaningful way what we have.

2.We do not have a horse shortage. We have an owner shortage. Get it straight. In 2009 we had 634 owners owning at least 1 horse that had 1 start or more. In 2010 the number of owners dropped to 488 and this year it has dropped again to 377. Now take out a piece of paper and draw a line from the top left to the bottom right. Get the picture. That’s the trend. And unless someone knows something that I don’t that trend will continue unless we do something about it now. We need new owners and quickly. It will not come from the 22 year old that comes to the track Friday night. He/she is paying off his and hers student loan. He/she wants to purchase a new car. He/she is thinking about getting married. He/she wants to buy a new condo. But he/she is not betting any appreciable amount at the track let alone buying a new horse. They will one day but well into the future. We need to approach perspective new owners now that actually have money! We need new creative ideas on how to get someone to buy a horse. (More on this in a future blog).

We need individuals in their forties that are in their peak earning years. We need a professionally done package that can be distributed to Doctors, Lawyers, CEO’s, Presidents of Companies and so forth. Stop with the wiener races and the emcee announcing nonsense. Start to get serious. These are feel good events but do nothing for horseracing.

We need to think outside the box. The old ways will not work anymore. We need to be creative. I spend almost every morning at the racetrack. Besides watching my horses gallop with my other horse partners, I talk with many other trainers, owners and jockey agents. There are many very bright individuals at our track in the “back”. I wish that once a year all of the “committee members” would come as a group one morning and watch some horses gallop and talk to the real people that make all of this happen. Just once a year. It is not an unreasonable request.

Next week I turn 59 and I plan on being in my box at the races. And I also plan on being in my box when I turn 69, 10 years from now as there no finer place to watch horse racing than the biggest little track in the world, Hastings Racecourse. But I need the track to be there.

Michael Robert Bye
G&G Stable