IHHA State of the Industry Report

03:53 AM 23 Jan 2008 NZDT
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Illinois Harness Horsemen's Association

2007 has proven to be challenging, interesting, and eventful year for our industry.

The Illinois Harness Horsemen’s Association (IHHA) are continuing our efforts to cause all to realize that YOUR IHHA and other horsemens’ groups do represent the more than forty-thousand (40,000) legitimate business persons involved in the many activities relative to our important industry, with an investment exclusive of race track operations, of probably more than five billion dollars in the State of Illinois; and, that we, as any other business-men and women seek to achieve a fair and reasonable return on our investment.

There has been an evolution, a metamorphosis if you will, from two (2) or three (3) persons racing down a dusty country road, for a Sunday meal or bragging rights, to a multi-billion dollar industry comprised of serious and professional business people.

One of our goals for 2007-2008 was to be able to transition our racing schedule to 2008 without any interruption.

For the second consecutive year we have been able to accomplish this thru a spirit of mutual understanding and cooperation between YOUR IHHA and Maywood/Balmoral management.

Additionally, we have a tentative Agreement with Hawthorne Race Course.

It should be noted also, that as part of the 2008 Agreement, Maywood/Balmoral has agreed that in the event that Maywood and/or Balmoral are closed for remodeling, renovation, or construction and are not racing as scheduled during calendar year 2008 and extending into 2009, they shall provide at no charge to horsemen, stall facilities, use of racetrack, and housing with appropriate utilities at Maywood and Balmoral for horses and tenants at whichever facility those horses and tenants would normally be stabled. and housed.

This accommodation was requested and granted since should favorable legislation be enacted, major changes to the physical plants might become a reality.

A most important benefit which we are charged with is to provide a strong subsidized insurance program for our eligible members.

A continuing efficient administration and a more aggressive cost preservation and protection policy did enable us to absorb any increases during 2007 and to hold 2008 increase to a minimum level in spite of huge insurance industry increases.

Our insurance consultant brokers and underwriters are to be applauded for their cooperation and understanding in the matter.

Additionally, because of our positive actions, we were able to declare two (2) “insurance premium holidays”, making for a total of three (3) such “holidays” in the past fifteen (15) months, to our members; a savings we were pleased to pass along.

We have placed YOUR IHHA is a stronger financial position and have been able to reduce some of the costs related to our operations.

These savings were passed along in the form of slightly increased pursed during 2007.

We continue to work with track operators to find solutions to the declining on-track handle which negatively impacts our purse account.

The cooperation and understanding between our groups has enabled us to sustain these increased purse levels throughout 2007 .This is an on-going battle in all venues of our industry and we are actively seeking an answer as is the entire standardbred and thoroughbred industry.

Legislative assistance is necessary for our industry to survive and to return Illinois to the once prominent position we held.

There has been a spirit of cooperation between YOUR IHHA and track operators in many areas of proposed legislation. This has translated in our Illinois general assembly seriously considering and proposing needed assistance thru implementation of HB4194.

This is good legislation.

It does provide for: Slots on track, total and complete repeal of recapture immediately upon commencement of slot revenues, resumption of standardbred racing at Fairmount Park (an Illinois track that has been void of standardbred racing for many years depriving our Southern Illinois horsemen of opportunities), protection of live racing opportunities, a percentage of Adjusted Gross Slots Revenues estimated to double purse account when fully implemented, additional monies for breeders’ awards and county and state fair programs, adequate funding for Illinois Department of Agriculture for testing purposes, increased commissions from OTB’s, Advance Deposit Wagering whereby the horsemen are equal partners.

There are some modifications we are seeking to further improve this proposal, such as, adequate funding for the Illinois Racing Board in order that they can conduct a comprehensive testing program to insure and promote the integrity of Illinois racing.

This is good legislation. YOUR IHHA, its’ legislative team, our lobbyists, are in constant contact with members of the Illinois general assembly and staff on a daily basis.

We have presented testimony at several House Gaming Committee hearings and have been well received. We are continuing with our set goal of being “pro-active”.

It appears that after our last gaming committee hearing that discussions will continue throughout January and we are cautiously optimistic that positive action will take place in early February or sooner.

There are other matters of legislation which are of concern to our industry and we bring to your attention.

A huge victory for Illinois horsemen during 2007 was passage of HB950 providing a sales tax exemption on all purchases, claims, or transfers of racehorses and broodmares in Illinois.

Without enactment and reinstatement of this expired exemption, all horsemen would have owed the state 6.75% tax plus penalties and interest applied to the cost of all horses claimed or purchased since year 2000.

The passage of this bill, which was accomplished solely by the efforts of YOUR IHHA saves our horsemen millions of dollars. A great job by our legislative team and lobbyists.

The passage of HB1918 commonly referred to as “The Molaro Bill” was a major accomplishment for our industry.

Your IHHA was able to “re-negotiate” the benefits with track management to an even more favorable position including the elimination of recapture during the two (2) year term of this bill.

Although the benefits of this legislation have not been realized because of court action put forth by the riverboat casino industry, the monies are being escrowed each month in anticipation of their release.

It is expected the Illinois Supreme Court will make their decision in this regard before the end of February 2008 thus making available for the standardbred purse account some $5.0 million plus annually in addition to elimination of a significant portion of prior recapture obligations.

We are hopeful that we will prevail.

As regards one of the most important issues of concern in our industry, “integrity”, we continue to investigate different programs, have discussions with the track and Illinois Racing Board.

We need to provide assurances to our fan base, to the State, and to each other that Illinois racing is conducted with the highest degree of integrity and at the same time we need to be certain that horsemen’s rights are protected.

While the Illinois Racing Board, due to present budget constraints, cannot now implement a comprehensive testing program, we continue to discuss programs with them in anticipation of adequate funding being made available thru proposed and supported legislation.

The winds of change in 2007 brought to YOUR IHHA the services of our newly appointed Executive Director, Anthony “Tony” Somone. Tony brings to this position experience in our industry, but most importantly, an enthusiasm and passion for getting things done to benefit his fellow horsemen.

Welcome and best wishes to Tony.

There is a large task ahead for all of us.

We need to stem the tide of more and more owners, trainers, drivers, and top horses leaving Illinois for those more progressive states that have recognized the importance of their agri-business community and have implemented the plans to save an industry.

We must all work together, horsemen, track operators, and legislators, all of us, to insure that we are here to stay and continue to provide benefit to Illinois.

Mutual respect, cooperative efforts, and understanding will be the watchword for 2008.

George Bonomo, President, Illinois Harness Horsemen’s Association

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