The Week in Review: A Tale of Two Stakes Purses

Imagine if you woke up last week from a Rip Van Winkle-like nap of 20 years and a fellow racing enthusiast told you once-moribund Charles Town Races in West Virginia now hosts a $1.2 million stakes race for older horses, and that the purse of the GII Charles Town Classic in 2018 could double that of the storied GI Santa Anita H. at Santa Anita Park.

Would you believe your railbird friend? Or, perhaps more importantly, would you be able to comprehend two decades worth of explanations about racinos, the corporatization and consolidation of American racetracks, the shrinking foal crop, and myriad other factors that affect today's racing landscape without your eyes glazing over and nodding back off to sleep for another few years?

Last week, separate news about projected purses for each of those two stakes shared the sport's headlines. In each case, both tracks believe they are making business decisions that are in the best long-term interest of their racing programs. Yet each is facing similar scrutiny for essentially making opposing choices about how much money to offer for their signature races.

Charles Town wants to keep its main attraction funded at $1.2 million (previous Classic runnings have been as high as $1.5 million). But the West Virginia Racing Commission (WVRC) refused to approve the track's entire open stakes schedule for 2018 on Dec. 12 after one commissioner emphatically argued the money could be better spread out among races suited to local horses (TDN story here).

Charles Town management told the WVRC that it would not slash the Classic to the commissioner-suggested $300,000 level, countering that the seven-figure April race benefits locals in other ways (like in terms of increased handle and as a valuable, star-powered marketing tool). The meeting ended in a stalemate when WVRC voting on the stakes schedule got tabled indefinitely, and the track is now in the unusual (unprecedented?) position of starting the new year without knowing if it will be able to card the Classic or any other open stakes in 2018 unless the commission changes its mind.

Meanwhile, in California, the Blood-Horse first broke news Dec. 14 that Santa Anita wants to cut stakes purses in 2018 to bolster “middle class” overnight purses. Getting the day-to-day racing back on firmer footing has been the mission of track owner The Stronach Group (TSG) for the better part of a year now, and it's a difficult task without an easy solution. The most conspicuous cut would slice the Santa Anita H. purse from $750,000 to $600,000 (which comes on the heels of the Big 'Cap already taking a trim from $1 million in 2016).

The upcoming Dec. 26 Santa Anita meet (and stakes schedule) has yet to be approved by the California Horse Racing Board, and Thoroughbred Owners of California president and chief executive officer Greg Avioli told the Blood-Horse that “it was inappropriate [for Santa Anita] to release a stakes schedule without a horseman's agreement.”

So at first glance, Charles Town is taking flak for wanting to run a showcase race that is allegedly too top-heavy at the expense of not serving the interests of its local horsemen, while Santa Anita is facing allegations of eroding its grand stakes tradition in the effort to beef up its day-to-day product. In reality, neither summation is that simple.

Erich Zimny, Charles Town's vice president of racing operations, has lots going for his argument to keep the Classic at $1.2 million. He oversees a program that had very little national recognition or following among bettors prior to 2009, the year the Classic was first run. But because the race annually draws well-known horses, jockeys, and trainers, he told me last week that it “provides the type of attention that traditional advertising could never buy us,” creating a “halo effect” that lasts all year long. The nine largest handles in Charles Town's 84-year history have all been on the first nine Charles Town Classic days. Handle per race on a year-round, everyday basis is up 65% since 2009. Purses paid to West Virginia-breds have basically doubled since that first Classic.

While Zimny admits that boost in business can't be entirely pinned to the advent of the Charles Town Classic, there is little doubt that the seven-figure race affords the formerly backwater track a hefty shot of nationwide relevance, and it seems like money well spent when you consider the trickle-down effect to local outfits. Big races simply mean more to smaller tracks (even those with gaming-enhanced purse structures, like Charles Town), and it's worth noting that no local horsemen testified at the WVRC meeting against funding the Classic at $1.2 million.

Zimny pointed out that Charles Town's contract with horsemen allows for the budgeting of 8% of the purses paid for the prior year to go toward the following year's non-state-bred stakes schedule, and the $1.2 million Classic, plus five other open stakes the track wants to run, all fall within that required cap. Zimny cited Charles Town's stakes-as-percentage-of-purses rate as “one of the lowest in the country” compared to some tracks, where that number is as high as 30%.

Santa Anita is one of those tracks. “We were a little bit stakes heavy,” Tim Ritvo, chief operating officer of TSG, told the Blood-Horse in explaining the purse money redistributions. “Percentage-wise for that meet, we were up at 30% [of total purses going to stakes], which is pretty high. It's one of the highest in the country. Most [horsemen's groups] don't want you going over 28-26%.”

Detractors are going to zero in on the “fall from grace” factor of what was once the most prestigious race for older handicap horses in the nation. But you could hang a gaudy purse of $2 million on the Big 'Cap, and it wouldn't benefit Santa Anita one iota in terms of solving the track's day-to-day woes involving slim fields and horse shortages.

Charles Town gets more bang for its buck out of the Classic, and it gets it in different ways that aren't relevant to what non-slots-enhanced Santa Anita is trying to accomplish by re-allocating the Santa Anita H. purse money. Ritvo, like Zimny, has logic behind his rationale for moving funds to where they are needed most. It's not so much “new math” as a new racing landscape.

But part of racing's 21st Century lay of the land also includes the consolidation of racetracks under single entities. TSG now controls six racetracks, and if you want to pinpoint the decline in relevance of the 82-year-old Big 'Cap, it might be worthwhile to look 2,700 miles east to TSG-owned Gulfstream Park, where it is clear that the GI $16 million Pegasus World Cup (PWC) has become the focal point within the company as far as winter graded stakes races for older horses are concerned.

When the concept of the PWC was unveiled in May 2016, I interviewed Frank Stronach, the founder and honorary chairman of TSG, and asked him if he had concerns about his novel, buy-in race conflicting with TSG's other history-rich winter Grade I stakes races for older dirt males, like the Donn H. or Santa Anita H.

“They go on. That's not a problem,” was Stronach's reply.

It's now a year and a half later. The Donn H. no longer exists on the Gulfstream stakes schedule. Its Grade I status has been transferred to the PWC.

For the 2018 running of the PWC, TSG has added $4 million to the purse beyond the collective $12 million buy-ins that have to be put up by horse owners who want to run in the race. On Friday it was announced that TSG had to buy three additional $1 million starting-gate berths because only nine of the 12 berths were purchased by the Dec. 15 deadline for the world's richest horse race on Jan. 27 (and Stronach himself, separate from TSG, owns one of those starting berths, so only eight were sold to outside interests).

Back at Santa Anita, if the stakes cuts are implemented as planned, the March 10 Santa Anita H. will be run for $600,000, amounting to the lowest Santa Anita H. purse since the race was run for $450,000 in 1985.

A realignment in priorities at TSG is definitely underway on several different levels. The outcome won't be evident for some time to come. The only certainty right now is that there's more to the big-picture equation than simply subtracting from the purse of the Big 'Cap to give a much-needed boost to the day-to-day backbone of Santa Anita's racing program.