After nearly six months of occasionally bruising negotiations, Arlington Park and the Illinois Thoroughbred Horsemen’s Association finally signed a two-year contract Monday that covers the 2020 and 2021 seasons and will allow live racing to take place at the racetrack starting in July.
Late breakdowns both Thursday and Friday forced the Illinois Racing Board to recess the meeting over the weekend. Commissioner Thomas McCauley and Executive Director Dominic DiCera, who were instrumental in keeping the parties on course throughout the negotiations, were both lauded by the two parties and IRB Chairman Daniel Beiser after McCauley confirmed a deal had been reached at the top of a meeting Monday.
“I just wanted to express on behalf of Arlington, all the employees of Arlington, everybody that’s involved in this entire industry, the amount and depth of work that was put into this by Commissioner McCauley and Director DiCera and the ITHA board,” Arlington Park President Tony Petrillo said. “We’ve had our bumps — more than bumps — but we are really indebted to these two gentlemen for their perseverance, but most of all their patience.”
Speaking after Petrillo, ITHA Executive Director David McCaffrey quipped that “if that was his definition of ‘bumps,’ I’d like to know what an explosion was.” He added, “All is well that end’s well … and we’re thrilled to death we got to the finish line.”
The sides were supposed to have a signed contract in place by Jan. 1 as part of the capital bill Gov. J.B. Pritzker signed into law last June that also legalized sports betting in Illinois. While terms of the deal were not announced, Arlington Park had publicly committed to overnight purse sizes of $130,000 in 2020 and $150,000 in 2021 in a statement to US Bets earlier this month.
There will be no Grade I stakes races this year, but the Arlington Million and Beverly D. will return in 2021.
Dark host days dispute with Hawthorne
Illinois Racing Board approves license for @Arlington_Park live meet after agreement with @itharacing on 2-year contract. IRB also assigns dark day simulcast host status to Arlington after Hawthorne requests compensation for keeping backstretch open to Tbred horsemen for months.
— Ray Paulick (@raypaulick) June 22, 2020
Almost immediately after reaching the deal with the ITHA, Arlington Park found itself in a new dispute with Hawthorne Race Course regarding the scheduling of dark host days, which started last Friday and carry until July 22 — the day before Arlington Park’s live schedule is slated to begin.
Dark host days are days in which there is no live racing, and the host track receives a substantial percentage of the revenue generated from simulcast wagering.
Before the vote assigning dark host days, Hawthorne Assistant General Manager John Walsh requested that the board consider a reallocation of those days being assigned to Arlington Park. He noted Hawthorne had its backstretch open for three months due to the COVID-19 pandemic, which Walsh estimated cost $239,000 per month.
Walsh estimated Hawthorne has lost $1.5 million due to the virus and stressed, “This is the last chance to equalize what’s happened because of COVID virus. After this meeting, Arlington will be running live and Arlington should be the host when they are running live.”
“After this there can’t be any equalization because Arlington will just be host and they’ll be running their meet,” he added. “Not only did all of those things happen, we also deferred recapture for two years to make sure we had some purse money for this fall.”
Recapture is a way to help tracks in Illinois avoid losses, and in January the IRB approved recapture of $11.5 million in 2020 purses to the three tracks. Arlington Park was awarded $4.5 million of that total for the 2020 fiscal year, while Hawthorne Director of Publicity Jim Miller told Sports Handle the amount deferred by his track was $3.397 million.
Petrillo points out losses Arlington will incur
Another summary: Hawthorne eliminates recapture, giving 4.8 million back to horsemen. Hawthorne asks IRB for about 200k in dark host fees to make up for COVID losses and Arlington threatens to sue.
— Horse_Scott (@horse_scott) June 22, 2020
Petrillo pointed out that any change in the schedule agreement between the two tracks “raises a huge number of legal issues” and any change in the dark host times would “result in a reduction of purses at Arlington and we would have to question how to conduct a 2020 race meet.”
He said Arlington lost approximately $1.5 million in live racing purses and an additional $3.5 million in commissions.
Walsh said Hawthorne deferred recapture until the casino opens — the track has applied for a casino license to become a racino as allowed in Pritzker’s bill signed into law last year — because “we wanted Illinois horsemen to be able to earn money this year and next year to continue on with their livelihood. It has nothing to do with financially what we could or could not do, and I’m sorry Tony characterized it that way.”
The two continued pressing their cases to the board, and it became clear commissioners were empathetic to Walsh. Beiser and fellow Commissioner Benjamin Reyes asked if there was a way the equalization could possibly be done by the board or if the two sides could do something for 2021.
After Petrillo said that the Arlington Park Department of Health had yet to clear the track to open, Walsh said “even 15 days of dark host coming up” would be helpful before going on the offensive.
“[Arlington] operated this whole time as though they were never going to open so now they have to rush to open. I don’t believe there will be any change in next year’s agreement between Arlington and Hawthorne because I don’t know if we can have an agreement after their actions this year toward the industry … we don’t believe that Arlington will make any restitution.”
Petrillo retorted: “Let me be clear, we will open our backstretch. There are delays because of the COVID-19 pandemic. Talking about repayment or reparation from the damages due to the COVID-19 virus to Hawthorne is just ludicrous. Any adjustment, and especially in purses, that will cause a purse cut here at Arlington.
“We’ve already lost five million dollars, we’re already going to spend another $450,000 to open up the backstretch because of the COVID-19 pandemic … when we look at the bottom line of each racetrack at the end of the year Arlington will lose more money than both racetracks all combined.”
A recess and a vote
The back and forth continued, with DiCera pointing out the issue had to be settled at this meeting since unassigned dark time could be considered as “not addressing regulatory duties.” The board took a recess of nearly 40 minutes, after which Arlington Park attorney Sean Wood said he found the IRB “has no statutory authority” to change the agreement the two parties signed.
IRB counsel John Gay interjected that the agenda item was requested by Arlington Park and not Hawthorne, resulting in the need to reassign dark host days, and asserted the board’s legal ability to assign host time per the Illinois Horse Racing Act.
The board eventually approved the dark host days for Arlington by a 5-1 vote, with McCauley casting the lone vote in opposition.
“I want to echo the sentiment that I’m not going to forget the contribution Hawthorne has made,” McCauley said after the vote. “I urge my colleagues remember it as well and that we put our heads together with staff to figure out a way to basically honor what they did for the horsemen and other parties.”
