Fearful of ‘Abyss’ Between Cali’s North/South Rift, Stronach Group’s Butler Renews Call for Negotiations

[Wandering Eyes]

Although the future of the Golden State Racing (GSR) meet at Pleasanton wasn't officially on Thursday's California Horse Racing Board (CHRB) agenda, the reverberations of dismal betting business through the first five weeks of operation at Northern California's new anchor track became the impassioned focal point of the Nov. 21 meeting.

Citing concerns that the autumn Pleasanton meet isn't living up to the hope that the former fairs-season-only track might help fill the NorCal void that occurred when The Stronach Group (TSG) closed Golden Gate Fields back in June, Aidan Butler, president of TSG's 1/ST business, implored stakeholders to reconsider variations on North-and-South purse funding, shipping, and stabling ideas that TSG and the Thoroughbred Owners of California (TOC) first proposed a year ago in the belief that some form of a cooperative that didn't involve direct competition would be in the best long-term interests of the state's racing.

Butler, who spoke extemporaneously and without a formal presentation, said he was trying to bring up ideas in an open forum because he's had enough of “looking at the abyss.”

TSG also owns the financially struggling Santa Anita Park, which is set to open its winter/spring meet Dec. 26.

Before Santa Anita's opening day next month, GSR will be back before the CHRB to seek dates for its 2025 season, which at times could end up running directly against Santa Anita and Del Mar Thoroughbred Club, like it's doing now.

“We're all fighting for our survival at the moment, and it's a tough position,” Butler said.

When the CHRB voted 6-0 back in March to approve a 2024 dates package that established Pleasanton as the new crux of a Northern California circuit, it faced a difficult decision in trying to balance the desires of NorCal horsemen and a coalition of statewide breeders (who stressed the need for a semi-permanent venue to complement the North's traditional summer fairs season) with those of SoCal racetrack operators and the TOC (who advocated an alternate plan to consolidate all of California's commercial-track racing in the South, with the North only remaining open for fairs).

That TSG-led concept had focused on redirecting simulcast revenue from the Northern circuit to the Southern tracks. It was based on a premise that would have attempted to accommodate displaced Golden Gate outfits by creating more opportunities for lower-level horses to race at Los Alamitos Race Course, dropping the “claiming floors” at both Santa Anita and Del Mar, and establishing “relocation allowances” for stables that had to pack up and move while only short summer fairs meets were conducted in NorCal.

On Thursday, Butler didn't delve into specifics, but he made a desperate call for reopening the North/South dialogue in light of how poorly the Pleasanton meet's betting is going.

“No one wanted the Northern horsemen, the Northern horses, or anyone up there to be in any distress,” Butler said. “A horse in the North, and horsemen in the North, [are] as valuable as any horse or horseman in the South, regardless of the price tag.”

Butler reminded commissioners that when the CHRB didn't vote to adopt aspects of the plan backed by TSG, the TOC and Del Mar, his organization “didn't push ahead” with opposing the Pleasanton concept. “We stayed out of the way,” he said.

Now fast-forward eight months, and with Pleasanton off to a rocky start, Butler said, “we find ourselves in a strange position now where everybody's failing. Every one of us. There is no great story coming out of this [and] this thing's a disaster. I don't worry about it from the company standpoint, [but rather] I worry about it from the thousands of employees who I look at every morning and stare at in the face knowing that they know this is no good.”

Even Larry Swartzlander, the executive director for the California Authority of Racing Fairs (CARF), who has been instrumental in turning the Pleasanton plan into reality, didn't dispute Butler's portrayal of how the new NorCal meet was hurting, business-wise.

“To give you a perspective on the meet at this point, we're entering our sixth week,” Swartzlander said. “We're 30% down in commissions. We expected 10%. That's unacceptable.

“We have the horses,” Swartzlander said, noting that average field size at Pleasanton this meet (6.51) is right about where Golden Gate's number was (6.50) for the early part of 2024.

“The horsemen are totally behind us [about] racing in the North. They're happy. Everybody's relocated to the Pleasanton area. The backside, the grooms have RVs. It's a very joyous background. Everybody's positive,” Swartzlander said.

“Yet the unfortunate side, as Aidan pointed out, is we're all losing money. The handle is not there,” Swartzlander said.

Butler put it this way: “Twenty million dollars is being sucked up into the North. The betting is an unmitigated disaster. [Customers are] still betting in the North the same as they always did on the South. That is not going the other way around. No one in the South really cares for the product, unfortunately. It doesn't mean no one tried, it doesn't mean they [didn't pull] out every stop to have a successful meet. So we're left in a really strange position here. What can we do?”

Butler answered his own rhetorical question by bringing up concepts he said could be on the table for renewed discussions.

“We have the ability to card races for the Northern horsemen and horses,” Butler said. “Point one, no one wants to relocate. I don't blame you–I don't want to relocate either. But let's just look at the facts. If they don't want to relocate, an option is, well, to cover all transportation costs. Point two, that's great. But then if you pull the horses out of the North, you've ruined the summer [fairs] meet, [which] the state needs.

“So we're in this very delicate situation. But there is a fix [and] there is an opportunity to build a plan that works,” Butler said.

“It will be suicide if we compete,” Butler continued. “No one will win. No one's winning now.

“So I would ask [if] the CHRB could speak with the powers that be in the North and bring everybody to the table in short order [and] see if there is something to be worked out,” Butler said.

“Because my intent, come [Santa Anita's opening day] is not to continue this madness, and just to go forward with what I believe is best for my employees, my horsemen, and California racing.”

CHRB chairman Gregory Ferraro, DVM, urged the North/South parties to take the next step and sit down to negotiate.

“It needs to be said that if our efforts to sustain some sort of racing in Northern California [fail], we could very well take down the entire state of racing,” Ferraro said.

“To try to come up with an alternate plan that has a better chance of being successful, I think it's in everyone's interest. We have a big enough problem with our purse structure as it is, let alone trying to compete against each other. So if you can make this work, all the more power to you. It gives the board another option to pursue,” Ferraro said.

Back in March, when the commission greenlighted the Pleasanton meet, CHRB vice-chair Oscar Gonzales had said that even if the NorCal interests got what they wanted out of the vote, they, too, had to realize that SoCal does need some form of cooperation and financial help. He said at that time that the decision should be “an opportunity to reset [and] the start of mending fences.”

On Thursday Gonzales said that even though he counts himself among the North's “bigger proponents,” he also believes California racing should now be thinking along the lines of one unified circuit, albeit one that doesn't just include summer fairs meetings in NorCal without an anchoring track to keep North viable the rest of the year.

Commissioner Dennis Alfieri said that, “With ideas like this, [Butler is] thinking out of the box. We are very concerned. None of us want–the whole industry–we don't want to see the North fail. And with the horsemen here, [this] is their livelihood. But we also have to look at the reality and face the facts.”

Commissioner Brenda Washington Davis said that, “I want to express appreciation for putting this idea out on the table, [but] I would just caution that [we] don't get too wedded to doing it one way, because the North may have some other ideas, and hopefully it will be a collaboration.”

Prompted by the CHRB for his proposed timing on any North/South pow-wow, Butler said, “The holidays are all upon us and the North's [2025 dates] application is coming up in December. This needs to move quite quickly, [so] we can put a presentation together pretty quickly, circulate it, and then let's just get all on Zoom calls and let's just start to have a conversation if there is a reality here. I think there is. I think it saves us all a lot of gray hair, and maybe makes Christmas a lot more fun for the people who are genuinely worried about [the future].”

Swartzlander, who told the commission that Butler had briefed him on Wednesday night about what TSG planned to propose at Thursday's CHRB meeting, said that he will be open to having discussions with Butler and other parties, because he believes that “something has to be done.”

Yet Swartzlander also said that while he didn't want to “dampen” enthusiasm for the TSG-backed ideas, he made it clear that other concepts, like pursuing the legalization of historical horse racing or fantasy sports gaming, might be better ways to supplement purses at Pleasanton.

“Is there a way to reorganize within the state of California, North and South? Sure,” Swartzlander said. “We race too much in the North. I'm sorry, we do. I'm not going to speak for the South. Is there a plan that we could come to that is not a total separation of racing to the South but a partial, so that we can both work together? We're certainly open to that.”

Swartzlander said the CARF board meets Dec. 10 to discuss its position for 2025, and that the “door is open” to meet with stakeholders “to discuss this offline before we come to the CHRB.”

But, Swartzlander cautioned, “We're pursuing a [Pleasanton] license for 2025. Money can be found, and that's my position.”

Butler made a final plea for thinking about the whole-state future of California racing.

“I'm not prepared not to fight at this point,” Butler said. “The game in this state deserves it. The game country-wide deserves it. I think all of us, if we just stop looking at what's going on today, and for the next meet, and look at the future, we're really in trouble.”

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