Time for Contraction

[castaway01]

1988, number of U.S. races: 71,014
2013, number of U.S. races: 43,139

1988, number of foals: 45,258
2013, number of foals: 21,275

1990, average field size: 8.91
2013, average field size: 7.85 (lowest in history)

1990, average starts per runner: 7.94
2013, average starts per runner: 6.32 (lowest was 6.11 in 2010)

Contraction HAS been occurring for decades...we have 40% fewer races in a year than 25 years ago. The problem is that we have 53% fewer horses to run in them, and they don't run as often. That leads to small fields.

I don't think closing tracks, slowly over time, will have much impact. Breeders will continue to leave the game. If you had a magic wand and could close 20 tracks tomorrow and those horses needed places to run, sure, field size would go up at the other tracks. But that's magic, not reality.

Jockey Club Stats

[dilanesp]

Originally Posted by cj

I understand that, but the biggest problem smaller tracks face now is that the pools are too small to be bet seriously. That is not going to change any time soon. There is at least hope that consolidation could make gamblers take notice as field size and handle grows. Right now all you have is a bunch of tracks doing the bare minimum to get subsidized. That is killing the game overall in my opinion.

Correct.

And more generally, think about the economics of simulcasting. In the pre-simulcasting era, it was possible for a track to survive with fairly modest attendance and handle and fairly modest racing product, because the track was the only game in town. Bettors had no choice but to bet on the races, even if the local product wasn't too good.

That's all changed. If a local racetrack offers a substandard product, and the bettors have the choice of betting on NYRA or Kentucky or Florida, what are they going to do? And that means over time, smaller tracks offering less bettable races WILL close. Whereas the races at the most important circuits figure to get better with handle increasing.

That's the future of racing-- a few supertracks with excellent overnight races with big purses and large, competitive fields, which are bet on throughout the country, and very little local racing. So if we want to attract new fans, we have to figure out how to attract them to that.

[VeryOldMan]

Originally Posted by dilanesp

Bettors had no choice but to bet on the races, even if the local product wasn't too good [. . . ] [t]hat's all changed.

This is the reality of today's horse racing. Back in "the day", it was the only legalized wagering. State lotteries came along, then Atlantic City, online wagering, casinos everywhere offering slots and table games, etc.

I grew up loving this game and have fond memories of some of the greats in the sport - but it seems apparent that the number of tracks/circuits has to contract to adjust to the current niche the sport occupies. It's not all or nothing - there is still a place for horse racing, but it is in decline and it would be nice if the "powers that be" understood the reality. Still seems like us remaining bettors surely come last.

[GaryG]

Alex Karras once said of the Redskins under George Allen: They might be old, but they're slow.

We could paraphrase that as: We are breeding fewer horses, but they are cheap and can't run past five furlongs. Write a card for nickel maiden claimers at 4 1/2 furlongs and you will see overflowing fields.

[whodoyoulike]

I won't be betting them at 4 1/2 furlongs.

[EMD4ME]

6 PM Eastern time Nov 1st, 2015

Here are my choices to wager right now:

Delmar (only 8 races on a SUNDAY)

Zia Park-10th race, 12 races today

Golden Gate-God I hate the Tapeta. 6th race of 9

Turf Paradise-Last race.

And you guys really want contraction?????

BTW, no night racing.

Yeah, I see the handle exploding on these tracks this sunday afternoon (NOT)

Yeah, many new fans are born today.... (NOT)

[dilanesp]

Originally Posted by EMD4ME

6 PM Eastern time Nov 1st, 2015

Here are my choices to wager right now:

Delmar (only 8 races on a SUNDAY)

Zia Park-10th race, 12 races today

Golden Gate-God I hate the Tapeta. 6th race of 9

Turf Paradise-Last race.

And you guys really want contraction?????

BTW, no night racing.

Yeah, I see the handle exploding on these tracks this sunday afternoon (NOT)


Yeah, many new fans are born today.... (NOT)

The argument is not that contraction will increase handle or make new fans. It is that contraction is necessary because there are not enough fans to support the number of tracks operating.

And we are in November. There honestly should not be much racing this late in the year- there never was when the sport was successful.

[Hoofless_Wonder]

Back in the mid-late 1990s, after seeing the beginning of a decline in racing, I thought the internet and online wagering would be the catalyst to revitalize the sport.

I could not have been more wrong.

Short of major changes in the tax code to bring in more owners, we won't see a return to 45,000+ foals any time soon.....

[AndyC]

Originally Posted by Hoofless_Wonder

Back in the mid-late 1990s, after seeing the beginning of a decline in racing, I thought the internet and online wagering would be the catalyst to revitalize the sport.

I could not have been more wrong.

Short of major changes in the tax code to bring in more owners, we won't see a return to 45,000+ foals any time soon.....

What could possibly be changed in the tax code to entice new ownership?

[Tall One]

A few options on the harness side tonight. I know that's not what your post is about, but just pointing it out.

[Hoofless_Wonder]

Originally Posted by AndyC

What could possibly be changed in the tax code to entice new ownership?

Write offs. Must show a profit now in two of seven years. In the good old days, an owner could write off losses indefinitely.

http://www.toconline.com/racingowner...p-and-the-irs/

I thought you were an accountant and would know that.

[SuperPickle]

Originally Posted by EMD4ME

6 PM Eastern time Nov 1st, 2015

Here are my choices to wager right now:

Delmar (only 8 races on a SUNDAY)

Zia Park-10th race, 12 races today

Golden Gate-God I hate the Tapeta. 6th race of 9

Turf Paradise-Last race.

And you guys really want contraction?????

BTW, no night racing.

Yeah, I see the handle exploding on these tracks this sunday afternoon (NOT)

Yeah, many new fans are born today.... (NOT)

I'm going to go out of my way to not to rip EMD4ME but his post doesn't take into account two things...

First, its the day after the Breeders Cup. Lots of tracks added additional races and additional cards to have live racing in between the BC races.

Second, its Sunday. The NFL owns Sundays. Every track and every OTB has tried an NFL tie in. Showing the Direct Ticket, food specials, giveaways etc. Pretty much all of them failed. Even Delaware Park stopped live racings on Sundays because no one cared about the races and everyone was betting football. People only want to watch and bet football on Sundays.

So to politely answer your post. NFL and day after the Breeders Cup.

[AndyC]

Originally Posted by Hoofless_Wonder

Write offs. Must show a profit now in two of seven years. In the good old days, an owner could write off losses indefinitely.

http://www.toconline.com/racingowner...p-and-the-irs/

I thought you were an accountant and would know that.

I am and I know all about the tax laws for racing. The rules you refer to are the hobby loss rules and they apply to every kind of hobby not just racing. I believe for the most part that hobby loss rules are fair. I also believe that if any horse owner is allowed to write off all expenses for their horse ownership that it would move the needle much at all.

People in the business full-time are not subject to the hobby loss rules and can write-off their losses without any concern for the 2 out of 7 rule.

[sharkie187]

Originally Posted by dilanesp

The argument is not that contraction will increase handle or make new fans. It is that contraction is necessary because there are not enough fans to support the number of tracks operating.

And we are in November. There honestly should not be much racing this late in the year- there never was when the sport was successful.

Maybe changing the way we bet can help increase revenue and draw new fans?

My examples of course come from Europe where race tracks there give patrons the option of pari-mutual and fixed odds wagering. Granted here in the US we want to bet our exotic wagers were as Europe generally bet to win (my regular bookie at Ladbrokes didn't know what an exacta or tri was until I started betting there.) i know fixed odds wagering is illegal but maye we can reconsider that option and have companies that offer fixed odds sign a deal that from their revenue, they're required to give the tracks at least 30%.

Also, here's an idea that really got me interested when I first heard about it in the bookmaker shops. On any normal race where there is a clear outstanding favorite...a second pool was created called "Betting WITHOUT the favorite." Everything works the same as a normal WPS pool but it eliminates the favorite and the odds are adjusted accordingly. So, many in England might have watched the BC Classic and were cheering on the second and third abd fourth place finishers because AP was not in their pool. When I was betting in this pool, it made watching a horse race a lot more fun to watch

[Hoofless_Wonder]

Originally Posted by AndyC

I am and I know all about the tax laws for racing. The rules you refer to are the hobby loss rules and they apply to every kind of hobby not just racing. I believe for the most part that hobby loss rules are fair. I also believe that if any horse owner is allowed to write off all expenses for their horse ownership that it would move the needle much at all.

People in the business full-time are not subject to the hobby loss rules and can write-off their losses without any concern for the 2 out of 7 rule.

IMHO, the tax law change in the mid 80's had an extremely detrimental effect on the sport. If owners, hobbyists or not, active/passive or not, could no longer write off losses indefinitely, then ownership just became a lot more expensive. I don't know what the ratio of business owners to hobbyists is in the sport now, but back in the early 80s it was not uncommon for owners to only have one or two "pets" that ran at the local track, often returning to the home farm for the winter. Some of my buddies put together some informal "syndicates" to claim a horse now and then, with the losses always available for one of them to write off.

Whether changing the laws back to help subsidize the sport today would have much of an effect, I don't know - but it couldn't hurt. Considering the anti-business atmosphere in tax laws today and the state of horse racing overall, maybe you're right and the needle wouldn't move much. But I don't know how else you get new owners in the sport.....