Nobody wants to see thousands of race horses put to pasture or reduced to steaks and glue.
And nobody wants to see up to 30,000 full-time and thousands of part-time horse-racing jobs disappear across the province.
But the stark fact is the racing industry is an outdated also-ran in the world of consumer entertainment.
It’s simply carrying too much weight and not enough drive for its long-term survival, at least not without government subsidies and a major product reset focused on attracting new customers.
That’s not just the message from the all-party provincial panel looking at ways to keep the bloated industry alive after the province ends its slot-machine revenue-sharing subsidies in March 2013.
That’s also the word from Rod Baker, president and CEO of Great Canadian Gaming Corporation, the largest racetrack operator in Canada, including Flamboro Downs.
Baker delivered that hot haymaker to Hamilton city council last month, the same day the Ontario Lottery and Gaming Corporation came to call.
He dressed it up in more polite and politic language, of course. But there was no mistaking that even if Baker’s company is awarded the new OLG licence for a Hamilton casino, the days of tipsters and tote boards at Flamboro are numbered unless the province once again primes the pump through the public purse.
“Right now, racing cannot stand on its own,’ Baker said.
Let’s hope council bears that in mind as it struggles to cough up the casino hairball stuck in its throat.
Mind you, Baker didn’t use the word subsidy. The horse industry prefers to call the provincial handouts a partnership.
That’s nonsense. As the panel’s report dryly notes, “If it is a partnership, it is a very one-sided one. It may work great for the industry — but what’s in it for the public?”
According to the report, taxpayers have funneled $3.7 billion into the business — $345 million last year alone — since the Slots at Racetrack Program (SARP) began in 1998 as a means of stabilizing the declining sector.
Instead of firming up the industry, however, SARP bloated it to “immense proportions,” creating a “perverse impact” on its development and feeding a “culture of entitlement.”
The growth, unplanned and unsustainable, rested on the popularity of one-armed bandits not riding boots and oat burners.
Some 63.6 per cent of purse revenue now stems from slot players not horse players, the report notes. For example, out of a total purse of $15.6 million at Flamboro Downs in 2010, $12.1 million was derived from slots.
OLG’s decision to end SARP and place gambling facilities closer to customers in order to maximize its own revenue not only exposed the hollow nature of the industry, it revealed how little it’s done to keep up with the times.
To his credit, Baker nailed that during his presentation to council. He said the industry generally hasn’t been “forward-thinking” enough to appeal to a new generation in the face of its “sunsetting” customer base.
The days of watching a 90-second race and then sitting around for half an hour until the next one with nothing else going on are over, he said. There needs to be more activity: bands, entertainment, and fewer racing days in order not to dilute the experience.
“That’s not easy for a traditional industry to get its head around,” Baker said.
Well, they’d better quickly try. Clearly, their current business model is a blinkered and broken-down nag.
All is not lost. The non-partisan provincial panel is plainly sympathetic to the industry’s plight as well as its place as a cultural and economic asset.
But, the report says, any new investment to preserve its “core elements” must come with objectives, benchmarks, a renewed focus on the consumer and “a business case showing that each public dollar invested is returned to the government through tax revenues.”
In other words, the days of free pony rides are over.