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Tuesday, September 20, 2011

Jeff Gural Responds; You Decide Whose Right

In a press release Jeff Gural responded to Joe Faraldo's comments claiming Jeff Gural was mischaracterizing the drug problem and claiming that horsemen are not serious about addressing the drug problem and was wrong to call the drug problem an epidemic.

To be fair to all, here is a follow-up after his testimony by Joe Faraldo, President of the SOA of NY, to members of the legislature which was released publicly by the SOA.


I want to thank you again for the opportunity to testify at last week’s Senate hearing on the proposed constitutional amendment. While I am confident that my submitted testimony on that important issue accurately identified the horsemen’s position for the record, there was another issue discussed during questioning after my testimony – the recent legal case involving the NYS Racing & Wagering and out-of-competition testing – that I believe requires further clarification.

Quite frankly, we are grateful that you asked about the case, because clearly the upstate track owner who apparently raised the issue of drug testing in horse racing at your September 6th hearing unfairly characterized both the overall issue and, more specifically, the lawsuit brought against the Racing & Wagering Board.

First and foremost, you should know that there is no group of individuals with a more compelling and direct interest in protecting the integrity of horse racing than the horsemen. The security of our financial investments in this sport – from horses to farms to equipment – is directly related to ensuring that racing is conducted fairly and legally, and therefore we have every interest in making sure that racing is as well-regulated as possible. Any inference that the horsemen believe differently – whether it is specifically related to drug testing or any other regulatory requirement – is both unfair and simply not grounded in this factual reality.

Within this important context, we have sought to work closely and constructively with the Racing & Wagering Board on a wide range of regulatory issues. Unfortunately, on this particular issue (which we acknowledge was well intentioned, but badly handled), the Board chose not to work with us. As you can see from the below copied footnote #3 (page 3) from the judge’s decision (which we have attached), we horsemen simply sought input into the regulatory/rule-writing process, but our efforts were completely ignored by the Board and the new, unrealistic, unworkable regulations were subsequently put in place arbitrarily:

“On or about June 24, 2008, the Board solicited SOA’s review and comments to an earlier draft version of the OCTR’s [out-of-competition testing rules]. On or about July 3, 2008, SOA conveyed to the Board, in writing, various criticisms of the proposed regulations, which largely mirror petitioner’s arguments herein. The Board did not thereafter reply to petitioner’s concern. The next information the petitioners received was the pronouncement that the OCTR’s had been adopted by the Board.”

It is also extremely important to point out that the court’s decision (page 3) strongly reinforced our earlier point about the horsemen’s commitment to integrity in our sport and our understanding of the importance of drug testing:

“It is vital to comprehend, at the outset, that none of these parties are opposed to equine drug testing. All parties concur that drug testing is essential to the integrity of the harness horse racing industry, the betting public’s confidence, and the health of race horses.”

In light of these facts, you can see why we believe it is outrageous that the owner of Tioga Downs would seek to create the impression that the SOA of New York and other harness horsemen are not concerned about helping to resolve any issues with drugs in our sport. Furthermore, his suggestion that illegal drugs are an “epidemic” in harness racing is hyperbole of the worst sort, as it has absolutely no basis in objective fact.

I have attached for your review an article summarizing a new report that was just released by the National Association of Racing Commissioners International, which is the organization representing regulators across both thoroughbred and harness racing nationally. I would call your attention to the very first paragraph, which makes it clear that there is absolutely no evidence to support such sensational claims about an “epidemic” of drugging incidents affecting the integrity of racing:

“With very few exceptions, almost all race horses tested for drugs are found to be clean, a fact that undermines the credibility of those who peddle the perception that racing has an out of control drug problem,” RCI President Ed Martin said today in releasing an RCI report entitled Drugs in Racing 2010-The Facts.

NOTE: Also, in terms of setting the formal record straight, I believe I mentioned a statistic at the hearing of “less than 2% of horses racing in the US who tested positive.” I am pleased to report that it turns out that the actual number, as per this regulators’ report, is, in fact, only “0.015 percent of all samples tested.”

Once again, Senators, I can only speculate why the owner of Tioga Downs would besmirch the racing industry – and in light of the facts and the judge’s decision, it is obvious that these accusations are irresponsible and should call his own credibility into question – but I am grateful for the opportunity to address this issue again in greater detail.

As always, should you ever have any questions about this or any other matter related to harness racing in New York State, please don’t hesitate to call me at 718-544-6800 or our lobbyist, Joni Yoswein, at 212-233-5700. Thank you for letting me set the record straight on this important issue and for your continued interest in our industry.
And the response by Jeff Gural:
I would like to respond to the memorandum that Mr. Faraldo wrote that appeared on the USTA website on Friday, September 16, 2011. The origin of Mr. Faraldo’s comments relate to the fact that I was invited to testify at a State Senate Committee Hearing on the Future of Horse Racing in New York on September 6, 2011 in Canandaigua, N.Y. This was part of a series of hearings that the Senate is conducting to address the needs of horse racing, as well as the possibility of allowing table games at New York racinos. When I was asked about the future I said I saw three major problems which were effecting our growth.

1. The fact that our best horses typically retire at the end of their 3-year-old career, making it difficult for our fan base to identify with the stars of the sport. I told them that I believe that we were addressing that problem as a result of my involvement in the Meadowlands and I thought that was going to be solved.

2. I said that we had an aging fan base that over time was going to disappear and we were not replacing these customers with new younger customers. I suggested that one possible solution would be for the horsemen to take five percent of this $150 million of VGM revenue going to purses, including the Thoroughbreds, and use that $7.5 million to focus on marketing with the emphasis on attracting new younger customers. I pointed out that the existing lottery law, which I helped write in New York, mandated that 10 percent of the money we received from the slots must be used for marketing and four percent must be used for capital expenditures with a cap of $2.5 million per year. I explained it was unlikely that the track owners would divert marketing money from the casinos to racing since the economics did not make sense for them to do so and if we wanted to insure our long-term future it made sense for us to take over the marketing ourselves.

3. Integrity issues. I told the committee that I thought we had a major problem as many of our leading trainers were suspected of using illegal medications and that the consensus of most of our customers was that there were certain drug trainers who could step up a horse when a horse was moved into their barns. I thought this problem could easily be solved if the horsemen would agree to take one percent of the slots revenue or approximately $1.5 million out of the $150 million that we receive and give it to Dr. Maylin in Morrisville in order for him to have more tools at his disposal to catch the chemists that, in my opinion, are hurting us badly. I thought it might even make sense to use some of that money to hire a top flight private investigating firm to try to catch the criminals as well. I concluded by saying that I thought the horsemen would oppose these proposals.

Truthfully, my focus was not really on saving harness racing in New York as my main goal is to try to get a constitutional amendment to allow us to have full scale casinos at our facilities as obviously I am at a major disadvantage when competing with Turning Stone at Vernon and to a lesser extent Pocono Downs with Tioga. As far as I was concerned, I was not planning to make a big issue out of my testimony and I did not expect any legislative changes to occur.

The next day after I testified the Susquehanna River overflowed and flooded Tioga County, along with the adjacent counties and we were forced to evacuate everyone from Tioga and close the facility. It became obvious that this was a major catastrophe and that we were not going to be able to reopen for the weekend in order to host the Cane Pace. We immediately reached out to Pocono Downs to see if they would take the race as I thought it would be unfair to the horsemen who already entered, especially when you consider it was the first leg of the Triple Crown and the winner could supplement to the Jug.

Fortunately, the horsemen and management at Pocono came to the rescue and agreed to take the race as part of their 2-year-old Night of Champions and, as a horseman, I was greatly relieved. What happened next was very disturbing as several of the trainers called us when they learned of the change and advised that they could not race in Pennsylvania because their horses would test positive as a result of the strict protocol used in Pennsylvania. Fortunately, we were able to work out a plan since the race had already been drawn to be raced in New York whereby Pennsylvania authorities agreed to use New York testing protocol and as a result everyone was able to race.

As someone who hates the thought that chemicals are being pumped into horses who have no say and whose long-term effect is unknown, I reached out to find out what the differences in testing procedures were. Some of the differences are simply timing and the amount of medication that is allowed. There is some disagreement over whether Pennsylvania is actually too strict. What disturbed me the most, however, was the fact that I learned New York was not testing for anabolic steroids and Pennsylvania was. Worse yet, the reason that New York was not testing for anabolic steroids was the fact that the equipment to test for steroids had been purchased by the Thoroughbred horsemen. Richard Violette had mentioned this to me previously and he complained that Mr. Faraldo, on behalf of the harness horsemen, had refused to contribute to the cost of purchasing this equipment which I believe was about $400,000. What I did not know and only learned when I inquired about the differences in testing in New York and Pennsylvania was that because the Standardbred horsemen refused to contribute, the Thoroughbred horsemen insisted that the equipment could only be used to test Thoroughbred horses for anabolic steroids and not Standardbreds.

Obviously when Mr. Faraldo made the statement that no group of individuals have a more compelling and direct interest in protecting the integrity of horse racing then his organization, he neglected to mention they cared but they did not care enough to contribute $100,000 or $200,000 from the $50 million that they receive annually in purses at Yonkers to insure that anabolic steroids were not being used in New York.

As to Joe’s contention that I raised the issue of the lawsuit relating to out of competition testing, it is totally untrue because I never raised that issue at all. I only raised the fact that, in my opinion, we had an integrity problem which was effecting the future growth of the sport. Obviously Joe disagrees as he claims there is no evidence to support any claim that there is an epidemic of drugging affecting the integrity of racing. He goes on to point out that only .015% of all samples tested came back positive so obviously we have no problem and that it was unfair of me to besmirch the racing industry. When you have invested $125 million to reopen two bankrupt tracks in Upstate New York, are now planning to invest another $100 million to save the Meadowlands and considering how much time and effort I have put into marketing the sport and how difficult the Meadowlands project is, for Joe to imply that I do not have the best interest of the sport of harness racing at heart is obviously insulting. Truthfully, I was not going to raise the issue of the differences in New York and Pennsylvania as I was planning to work behind the scenes to address the problem and I think that Dr. Maylin is already addressing the steroid issue. However, since Mr. Faraldo chose to attack me I felt compelled to respond.

One thought I have is that it might be a good idea to determine if Mr. Faraldo actually represents the views of the majority of the horsemen. I would like to call on the USTA to do a survey of their members in New York, Pennsylvania and Delaware to determine if horsemen would consider taking one percent of the $500 million going to purses in those three states and use it for drug testing. I would like to think that a majority of the horsemen would support this proposal. I would be happy to pay for the cost of this survey.

I hope this clarifies my position. Frankly, I am glad Joe decided to put his position in writing which clarifies his position as well. The truth is everyone wants the best drug testing available but nobody wants to pay for it. This is true outside of New York as well.

So here you have it.  Both statements.  Since we don't have access to the exact testimony, we are left with both statements to work with.  Here are questions I would love to hear some responses on:

Do you believe illegal drugging is a problem or is it overblown?

Does standardbred racing have an integrity problem regarding drugs?  If so, is it well deserved?

Do you think the standardbred horsemen should have contributed some money towards the machine to check for anabolic steroids?  If not, why?

If a survey was done to see if horsemen in DE, NY, and PA were willing to donate 1% of their purse account towards drug testing, do you think they would say "Yay' or 'Nay'?


Harry Lare said...

Do you believe illegal drugging is a problem or is it overblown? NO, There is a problem.

Does standardbred racing have an integrity problem regarding drugs? If so, is it well deserved? YES

Do you think the standardbred horsemen should have contributed some money towards the machine to check for anabolic steroids? If not, why? YES

If a survey was done to see if horsemen in DE, NY, and PA were willing to donate 1% of their purse account towards drug testing, do you think they would say "Yay' or 'Nay'? Tough question. I think it would be very close and I would love to see the results

Jim H. said...

"...several of the trainers called us when they learned of the change and advised that they could not race in Pennsylvania because their horses would test positive as a result of the strict protocol used in Pennsylvania."

Not for nothing but this statement make one wonder aloud, "How is it that Lou Pena can race in PA and not NY?"

Less and less makes sense to me.

BTW Excellent blog (and the one that followed).