IN THE MATTER OF
THE ONTARIO RACING COMMISSION ACT,
AND IN THE MATTER OF 2005 LIVE RACE DATE APPLICATIONS
FOR WINDSOR RACEWAY
REASONS FOR DECISION
I. BACKGROUND
Pursuant to a Notice of Hearing dated January 14, 2005, under the hand of the Executive Director of the Ontario Racing Commission, a panel consisting of Commissioner Brennan, Commissioner Gorman and Vice-Chair Todd, convened a public hearing on January 18, 2005, at the hour of 4:00 o’clock in the afternoon with respect to the third application by Windsor Raceway for live race dates for calendar 2005.
At the hearing, the following parties appeared:
ORC Administration - Wendy Hoogeveen, Manager of Information Services and Tim Snell, Legal Counsel
OHHA - Arlen Sternberg
Windsor Raceway - Christopher Kruba, Counsel and John Millson, President
At the hearing, the panel additionally heard submissions from John Walzak, the Chief Operating Officer of the Ontario Harness Horse Association and Brian Tropea, Executive Officer of OHHA and a Director from District #11 that includes Windsor Raceway.
To set the context, this was the third application for live race dates by Windsor Raceway. The first two applications were found deficient and wanting. The details and particulars of these conclusions were delineated in Ruling No. GEN 18/2004 and a Notice to the Industry dated December 30, 2004, both of which can be found in Exhibit 1, Tabs 2 and 3 respectively.
This application by Windsor Raceway was dated January 12, 2005, and sought approval for 124 live race dates. The Administration supported the application as set out in Exhibit 3.
All parties before the panel were in absolute agreement that racing needed to be resumed forthwith at Windsor Raceway, the track having been shut down and dark for approximately three weeks by the date of hearing. It is unfortunate that the respective parties did not have this requisite sense of urgency prior to the cessation and shut down of racing on January 1, 2005.
Because of the urgency of the situation, we rendered our decision at the end of the hearing on the evening of January 18, 2005. Those conclusions and the oral decision are an appendix to the Order of the Executive Director dated January 19, 2005, being Ruling No. GEN 001/2005, both of which are appended hereto as Schedule 1.
We do note that the conditions contained in our oral decision were accepted in writing by the association, Windsor Raceway, by faxed communication to the Executive Director at 8:08 a.m. on January 20, 2005. Given the acceptance of our oral decision, Windsor Raceway will race 131 dates in 2005 and conduct an average of 15 live races per approved date unless otherwise agreed and altered in joint written agreement between themselves and the Ontario Harness Horse Association.
II. POSITIONS OF THE PARTIES
Windsor Raceway initially in the fall of 2003 applied for 153 race dates for 2004. These dates were approved by this Commission. At several points in 2004, Windsor Raceway with the explicit written concurrence and support of the Ontario Harness Horse Association applied for a reduction in their 2004 race dates so that eventually the 2004 race calendar consisted of 131 live dates. The rationale for this reduction was as noted in part in Exhibit 1, Tab 1, the statement by the Association’s Chief Executive Officer, John Millson, to the effect that:
“We don’t have the cash to operate properly and I need your help.”
The Chief Operations Officer of the Ontario Harness Horse Association confirmed OHHA’s support for the second reduction in 2004 by correspondence dated September 21, 2004 to the Executive Director of the Commission. This detailed document makes no mention of any agreement with the Association for a specific number of race dates in 2005 after the “major concessions on live race dates…” for 2004.
In all hearings regarding Windsor’s 2005 live race dates, OHHA was consistent in their view that Windsor Raceway should be required to race 153 days in 2005. The rationale for this position was essentially as follows:
(a) 153 days had been approved in 2003;
(b) 153 days had been applied for and originally approved in 2004;
(c) Windsor Raceway and OHHA had a verbal agreement to return to 153 days in 2005; and
(d) The real status quo at present for Windsor Raceway is 153 live race dates.
Additionally, Mr. Walzak provided us with argument that involved the economic planning of horse people and their reasoned and reasonable expectations after having made an investment in future horse racing. This argument involved both the timing, duration and quantity of significant investment by horse people with respect to their expectations of racing at Windsor Raceway.
OHHA’s submissions stressed that this hearing and the racing schedule at Windsor should be looked at simply as “about horse racing”. We were told that in the year 2000, Windsor had 184 live race dates and that there were somewhere between ten to twelve races per card. Additionally, it was acknowledged by Mr. Tropea that there were at Windsor in 2004 a total of 1,866 races.
On OHHA’s behalf, Mr. Sternberg referenced the concurrence of his client to a reduced racing schedule in 2004 as “expressly temporary” and on the express understanding that the 2005 racing calendar would involve 153 live race dates.
We additionally heard from Brian Tropea who clarified that the reduction in race dates in 2004 was more of an ultimatum than an agreement. His recollection was that the race dates were reduced by agreement of the horsemen because they were faced with a choice of reducing dates and costs or alternatively “We [the Association] will close the doors”.
Mr. Tropea continued in his submission by indicating that horse people were looking to the regulator for “guidance and direction”. We do note that OHHA has at all material times in recent history had competent legal advice and counsel. One might have thought it prudent to make OHHA’s concurrence with the reductions in 2004 live date reductions explicitly conditional and in writing had this been in fact that unequivocal understanding.
Windsor Raceway in its application before us provided generalized and uncontroverted evidence of significant and increasing competition for gaming dollars in Windsor and environs. However, Mr. Kruba was very clear that “the financial strength” or lack thereof of the Association was not part of his case. Rather the Association relied primarily on the performance of Windsor Raceway relative to other racetracks as delineated on Exhibit 2, being a ranking summary of slot performance and slot revenue at Ontario’s various racetracks. It did become difficult, however, for this panel to have Mr. Kruba tell us that “the financial status of Windsor, whatever it might be today, is not part” of the Association’s submissions to us when at the same time, Mr. Millson made repeated references to “the race track’s financial viability”.
Windsor urged upon us that there needed to be benchmarks and relationships established between slot performance and the quantum of live racing dates. We do note that these “benchmarks” referred to on numerous occasions by Mr. Kruba and Mr. Millson have been part of the Association’s Siteholders Agreement with the Ontario Lottery and Gaming Corporation since 1998. One might have thought that the Association could have, and perhaps should have, been in consultation with the OLGC some time ago to establish and document such benchmarks if same were in fact a significant part of their submission and input to this panel.
The majority decision for the initial reduction in live race dates at Windsor in February 2004 (see Exhibit 1, Tab 1, p.2) referenced the Commission’s concern that this reduction in dates and alteration of the race schedule did not perhaps take sufficient cognizance of the racing patrons and public in general who might wish to avail themselves of either racing’s entertainment and/or wagering elements. The Chair duly noted that “we expect the track to be knowledgeable about what the public in its community wants for entertainment and where the racetrack fits into the various opportunities…”.
Additionally, the Vice Chair on the same date in a dissenting decision indicated that “we have been given no real evidence as to why the proposed variation is in furtherance of the well-being of horse racing generally and the broader public interest. It is difficult to accept that Sunday and Wednesday ‘double headers’ should replace live Friday and Saturday evening presentations of live racing at Windsor.”
The Commission on these race date applications has to take significant cognizance of wider interests than the Association itself and their partners at OHHA who provide the racing animals and the racing program. Despite the above notice to the Association and despite the knowledge of all stakeholders that this Commission in the exercise of its powers has to consider the broad public interest, we received little assistance in respect of the public interest from either the Association or OHHA at this hearing.
Mr. Kruba acknowledged candidly that we were given no evidence from anyone as to what dates would be good for the racing public and the racing patrons who support this industry with their dollars, attendance and enthusiasm. OHHA’s evidence and submissions in this respect were only marginally more helpful.
Accordingly, we were faced with both an evidentiary basis and an argument by all parties that centred on their respective self-interests and which entirely ignored the public and the public interest that supports the pari-mutuel horse racing industry. In this respect, our labours were handicapped.
As part of the Association’s submissions, we were asked by counsel for Windsor Raceway to hear a prepared written statement by John Millson, the President of Windsor Raceway Inc. This statement can fairly be described as an emotional tirade of bald and unsubstantiated allegations. Mr. Millson’s presentation verged on a virtual rant.
We would have hoped that a senior corporate officer of a significant racing enterprise would have seen that his prepared statement was not helpful to this panel in reaching a conclusion and was furthermore destructive to the credibility and integrity of Ontario’s horse racing.
The panel specifically asked at the end of the hearing for a copy of Mr. Millson’s prepared written statement. Despite Mr. Kruba’s assurance it would be available and supplied, we did not receive same and in the circumstances were required to order a copy of the transcript of hearing.
Mr. Millson in his submissions made the following statements:
(a) “The Ontario Racing Commission has lost control of the decision process…”.
(b) “OHHA has chosen to make its arguments in the media.”
(c) “The giant Woodbine has sent a letter to the Racing Commission to take our home market away from us.”
(d) The Chair is “disclosing in the public forum Windsor Raceway’s confidential financial information.”
(e) “Historically, the Ontario Racing Commission has declined to approve race date applications not considered sufficient by OHHA”.
(f) “This decision process” is “being manipulated in the media”.
Neither Mr. Millson nor Mr. Kruba led any evidence or filed any exhibits to support these enumerated complaints of Mr. Millson. It is essential to fair procedural dealing and common courtesy in administrative hearings such as this that one should call evidence to support the basic tenets of the case as delineated either in opening or in submissions. This Windsor Raceway Inc. did not do. One would have expected much more of counsel for Windsor Raceway in this respect, especially given the implied undertaking of an advocate to call evidence to support statements made.
Mr. Millson’s allegations of misconduct by the Commission and other parties in these proceedings will be seen by both those outside the industry and those within as part of a self-destructive industry character trait that horse racing on occasion exposes with great fanfare to the wider public.
Again, one would have expected much more of this Association and its President. The broadcast and publication of such allegations in bald and unsubstantiated format can only be prejudicial to the best interests of racing and injurious to all who either earn their living or have an affinity to the sport of racing.
III. ANALYSIS
This panel in its decision of October 28, 2004, Ruling No. GEN. 18/2004, noted at page 3 the historical practice for the initiation, presentation, and consideration of live race date applications. After dealing with this application on this occasion and the two prior occasions noted above, we are left to ponder whether the jurisdiction of this Commission under section 7(a) of the Racing Commission Act, 2000, should not be utilized or expanded so as to depart from the historical race date practice and have the Commission prescribe an amended process that provides a better vehicle for consideration of the public that supports horse racing . Such a revised process would hopefully mitigate against the ills as referenced above.
At this hearing, we heard for the first time a firm commitment by the Association to conduct somewhere between fourteen and sixteen races on Wednesday and Sunday dates and ten to twelve races on Saturday race dates. Again, the panel was left to wonder why the delay of many months in having the Association provide us with this commitment when everyone knew this was an issue from the time of the hearing on October 28, 2004.
As above, we had some concerns and questions for OHHA with respect to the breached agreement to race 153 days in 2005. We have similar concerns with respect to the evidence and submissions of the Association on this issue. It is troubling to hear the Association confirm that, “There was some discussion” about the 2005 commitment but that counsel was not going to “speak for” the employee alleged to have made the commitment.
It is additionally most unhelpful to the credibility of the industry as a whole when one hears from an association that “regardless of what may have been committed to in February, there is now new data before you…”. The comments of Commissioner Brennan in dialogue with counsel for the Association probably best summarize our concerns overall:
“I would just hope that the attitude of everyone changes, that we have got to start getting along, not go in different directions, because if we don’t, you are going to be the loser and everyone in the industry is going to be the loser.”
IV. CONCLUSION
This panel was left at the end of the hearing with what we considered a significantly deficient evidentiary base upon which to adjudicate some of the competing positions. However, a decision was mandated in the public interest so as to terminate the stoppage of racing and the irreparable damage and alienation of Windsor’s horse racing fans and their wagering public. Our disposition and conditions will result in 1,965 live racing opportunities at Windsor in 2005, an increase from the 1,866 live races conducted in 2004.
We would stress that this decision should not be read as our concurrence to fifteen race programs being acceptable or to be encouraged in any respect. The previously stated concerns and questions about the suitability of “more races per card regimes” voiced in the past by this panel and by this Commission remain.
We would ask that the evidence given by all parties, including the Administration, in the future provide a better and more rounded evidentiary basis for race date applications such as this. In particular, we would hope to see some evidence whereby the public interest is considered along with the obvious self-interest of the parties. We cannot ignore the mandate of section 6 of the Racing Commission Act, 2000 and its prescribed “public interest” in the exercise of our directives and decisions regarding race dates.
The above are the unanimous reasons of this hearing panel.
Dated at Toronto, this 4th day of March, 2005.
_____________________
Larry Todd
Vice Chair