Florida de-coupling?

[Papillon]

1/ST Racing, FTHA throw support behind Florida decoupling bill

An agreement between the owner of Gulfstream Park and Florida’s horsemen to jointly support legislation that would allow Gulfstream to continue to operate its casino without any obligations to live racing will allow the track to obtain financing for improvements to the Gulfstream property, according to a top official at the company.

In an interview, Steve Screnci, the president of racing and business development at Gulfstream’s parent, 1/ST Racing and Gaming, said that the separation of the casino and racetrack licenses is necessary in order to gain access to capital markets for improvements to the property, which may include the building of a hotel and other developments. Screnci said that live racing would continue at the track unabated if the licenses are “decoupled.”

“We have no interest in ending live racing,” Screnci said.

A release issued by 1/ST on Monday announcing its support for the decoupling legislation initially generated confusion throughout the state racing industry. The release said that the legislation was supported by the state’s horsemen’s group, and that the two parties had reached an agreement that “ensures purse revenues are unaffected.” Purses at Gulfstream are subsidized by the casino attached to the track.

The issue of “decoupling” has a sordid history for Florida’s racing industry. While it was once mandatory for Florida tracks to maintain live racing operations to operate casinos, the legislature has walked back the requirement for a number of tracks, and those tracks have abruptly closed once the requirement was rescinded while continuing to operate their casinos.

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Lonny Powell, the chief executive officer of the Florida Thoroughbred Breeders and Owners Association, said that a lobbyist for 1/ST had notified the organization that it would seek the legislation over the past several months. Powell said that he believes discussions on the bill remain “ongoing,” though the bill was filed on Monday with a legislative sponsor, Rep. Adam Anderson.

Powell said that he has received no explanation for why the bill would enable Gulfstream Park to embark on a path that would be beneficial to the racing industry.

“Nobody has heard a reason for why this is good for racing,” Powell said. “I can say that it would be very difficult for me to envision our directors supporting this.”

The FTBOA has significant clout in the Florida legislature. The organization represents the state’s breeding industry, which is the second largest in the U.S., behind only Kentucky. Lay-up farms and breaking and training facilities centered around Ocala also tend to support the FTBOA’s positions.

The FTBOA may be joined in its opposition by the National Horsemen’s Benevolent and Protective Association, which represents horsemen in dozens of jurisdictions, including many trainers who ship in and ship out of Florida during the year, sometimes for extended stays. The Florida horsemen’s group based at Gulfstream that agreed to support the measure is not an HBPA affiliate.

“The NHBPA, along with its affiliates – including the Tampa Bay HBPA – and many other horsemen across Florida cannot currently support the proposed changes to [the legislation],” said Eric Hamelback, the chief executive of the National HBPA. “At this time, these changes do not appear to offer any favorable provisions for horsemen. For years, the NHBPA has consistently opposed decoupling from racing.”

Gulfstream Park is located in Hallandale Beach, Fla., on extremely valuable land. The track has room for 1,500 horses on-site. 1/ST also owns and operates a training center, Palm Meadows, 30 miles north of the track, where there is room for another 1,400 horses.

In the release issued by 1/ST, Anderson, the legislator sponsoring the bill, said that Gulfstream is “integral to our state’s economy and cultural heritage.”

“Gulfstream Park is not just a premier destination for racing; it’s a vital part of its local community, agriculture business, and state’s economy, providing jobs and driving tourism,” Anderson said. “Florida’s horse racing industry is a symbol of excellence and tradition, and I will continue to advocate for policies that ensure its growth and success, securing its future in Florida for generations to come.”

1/ST Racing and Gaming is controlled by Belinda Stronach, who took over the racetrack assets previously controlled by her father, Frank Stronach, as a result of a settlement of a lawsuit in 2020.

Last year, 1/ST gave up ownership of Pimlico Race Course in Maryland to the state as part of a deal that will also result in its other Maryland track, Laurel Park, closing and being redeveloped in three years. Under the deal, Pimlico is being rebuilt and will become the sole track in the state, operated by a state non-profit.

The company also abruptly announced last year that it would permanently close Golden Gate Fields in Northern California, which threw the racing industry in the state into chaos. 1/ST still owns and operates Santa Anita Park in Southern California and a nearby training center.

Several officials close to the company speculated on Tuesday that the intent of the legislation may be to allow 1/ST to cash in on Gulfstream’s real-estate value and build another track somewhere else in Florida.

Herb Oster, executive director of Florida’s horsemen’s group, said that horsemen accepted the explanation given to them from 1/ST about needing the casino to stand-alone as a business entity in order to obtain financing for development of portions of the Gulfstream property.

“The only hope we have to save racing there is to give them the ability to invest in the property,” Oster said. “We have to let them take their best shot.”

Oster said that in exchange for the horsemen’s support, 1/ST also guaranteed the group additional funds for worker’s compensation premiums and donations to Thoroughbred aftercare groups working with the backside.

[Dingus]

I’ll answer with 1 sentence.
Look what happened to Pompano Park.

[Brown jug]

perhaps but harness and t bred are two different businesses
a t bred track like gulfstream is money

[Papillon]

no doubt other states that subsidize race tracks will be emboldened to do the same, eventually

[Grandstand Handicapper]

Very interesting. A buddy of mine is on the board of the FTBOA and he said the horsemen want to support this because it will allow 1/ST access to capital markets as well as remove other restrictions they have on financing and the like. However, and this is the elephant in the room. The horsemen want to be completely and fully protected. This is an opportunity for the horsemen to benefit. The horsemen not only should want purses and revenue unaffected, they should negotiate for more---and apparently they are going to try. The FL t-bred horsemen are much smarter than the FL harness horsemen.

Subsidy, grant, or rent payment----the purse fund gets monies from the casino operation. The decoupling that closed Pompano does not apply to Gulfstream, hence, this agreement. Apparently, the horsemen want a "side agreement" that speaks to their protection, what they will get, purse levels, racing dates, etc.

I can't say if this is good or bad yet as the details have not been disclosed. But I am going to view it with an eye of scrutiny. Gulfstream is a money-maker. Stronach (Belinda) wants to expand, build, grow----hospitality, commercial, residential, and more. As long as the racing side of the facility and the horsemen benefit----and they should----then racing can survive, and ultimately thrive. However, if a company is simply looking to get out of racing, then it's over. While 1/ST has closed GG, made their deal in MD, I don't know that means they are looking to get out of racing. I believe they want to be in racing, but based upon their business model, and Gulfstream has always been their lead on that.

What scares me is if those alleged "officials close to the company" are on to something and 1/ST wants to monetize the land at Gulfstream and build another racetrack somewhere else in FL. That scares me.

It's great that Herb Oster feels getting concessions for worker's comp, aftercare, etc., is important----and it is----but the primary focus first should be racing and purses.