The New England Horsemen’s Benevolent and Protective Association, Inc
A National Organization
October 6, 2021
Ms. Cathy Judd-Stein
Massachusetts Gaming Commission
101 Federal Street, 12th Floor
Boston, MA 02110
Dear Chairperson Judd-Stein:
As you know, the New England Horsemen’s Benevolent and Protective Association, Inc. (NEHBPA) represents the Thoroughbred Owners and Trainers who were racing in Massachusetts for the past several decades until Suffolk Downs declined to continue to conduct a full meet in the years after 2014.
When Suffolk Downs announced its intention to discontinue racing activities and develop the property, the NEHBPA was able to negotiate an agreement with Suffolk Downs whereby Racing Festivals were conducted each year. These festivals helped sustain the thoroughbred breeding industry in Massachusetts, provided opportunity for Massachusetts horsemen to race locally, and maintained public interest and support of thoroughbred racing in Massachusetts. As important, those festivals also helped maintain employment while also continuing to support and sustain farms and small businesses reliant on horseracing.
The NEHBPA continued to represent the owners, trainers and breeders who raced at these festivals. With the funding from the Race Horse Development Fund (RHDF) administered by the Massachusetts Gaming Commission, the NEHBPA was able to continue its Health & Welfare programs, as it does today.
We continue to be concerned, however, that while the RHDF accrues funds that are largely unexpended due to the current hiatus in thoroughbred racing, there continues to be a public debate about how that fund should be spent.
It is clear from the enabling statute that the money in the RHDF is intended to support and promote the thoroughbred and standardbred racing industries and we believe that should determine how the Commission proceeds on this question. We believe that the funds assigned to thoroughbred racing should be held in escrow until such a time as we have an operational track in Massachusetts. We also believe that a discussion about how the RHDF could be used to “benefit breeders, owners, and the industry as a whole” as state Auditor Suzanne Bump recently commented – is an opportunity to protect these funds in escrow to further the interests of the thoroughbred industry, as the law intended.
Since the closing of Suffolk Downs in 2019, the NEHBPA has diligently sought a site in Massachusetts for the development of a racetrack and equine center. We are currently working with a developer to secure necessary local and state approvals for the Sturbridge Equine and Agricultural Center, which has now secured two positive votes from town boards.
When the Massachusetts Legislature created the Horse Race Development Fund, it did so with the objective of sustaining the thoroughbred and standardbred racing and breeding industries. It recognized the significant economic impact of these industries on the economy in Massachusetts. It now appears that the continued and sustained efforts of the NEHBPA to bring full time thoroughbred racing back to Massachusetts is likely to result in construction of a new racetrack.
The NEHBPA requests that the Massachusetts Gaming Commission forthwith establish an escrow fund for monies from the Race Horse Development Fund allocated to thoroughbred racing. CMR 205 149 (copy enclosed) specifically addresses an escrow fund and provides, inter alia:
149.04 Race Horse Development Fund: Distributions; Escrow Accounts (1) If the Commission determines pursuant to 205 CMR 149 .03 (2) (a) that the monies due a harness racing association or horse racing association from the race horse development fund shall be placed in an escrow account, the commission shall establish a race horse development escrow fund to hold such funds and any interest thereon for distribution in accordance with M.G.L. c. 23K, (Section) (c ), the recommendations of the horse racing comm ittee, and 205 CMR 149:00.
Securing the RHDF in escrow is particularly important now that the Sturbridge site is on an approval path as these funds will be critical in the early days of racing, consistent with the objective of the legislation creating the Fund
The NEHBPA has been representing all local owners and trainers of thoroughbred horses since 1940 and continues to advance the interests of local horsemen.
Thank you for your consideration of this request that an escrow fund be established to which is deposited monies from the Race Horse Development Fund allocated to thoroughbred racing.
Sincerely,
Anthony Spadea,
President, NEHBPA
CMR 205
149.03: Notice to Commission of Intent to Discontinue Racing (1) A harness racing association or horse racing association shall provide the commission at least 30 days prior written notice of its intent to take any of the following actions: (a) To discontinue harness races or horse races for the remainder of a harness meeting or horse meeting; (b) To permanently discontinue harness races or horse races; (c) To close a race track used for harness races or horse races; (d) To abandon or relinquish a license; (e) To not apply for the renewal of a license; or (f) To transfer a race track to any other entity. (2) Upon receipt of a written notice of intent pursuant to 205 CMR 149.03(1), or upon learning that the harness racing association or horse racing association has failed to timely notify the commission pursuant thereto or that any event described in 205 CMR 149.03(1)(a) through (f) has occurred or will occur, the commission may take one or more of the following actions: (a) Hold a public hearing to determine: 1. whether monies from the race horse development fund which the harness racing association or horse racing association would have received pursuant to M.G.L. c. 23K, § 60, should be placed in a racing escrow account for distribution pursuant to 205 CMR 149.04; 2. whether to transfer monies from the race horse development fund which the harness racing association or horse racing association would have received pursuant to M.G.L. c. 23K, § 60 to a different harness racing association or horse racing association; 3. whether to transfer the harness racing association’s or horse racing association’s license to a different harness racing association or horse racing association; 4. whether to take any other action within its authority to protect: a. the interests of the commonwealth; b. employees or former employees of the harness racing association or horse racing association; c. harness racing horsemen and horse racing horsemen; and d. the intended beneficiaries of the race horse development fund, any other fund established pursuant to M.G.L. c. 23K, 128A or 128C, and any other fund to which the harness racing association or horse racing association was required to contribute. (b) Require the harness racing association or horse racing association to pay to the commission any amounts required pursuant to the terms of its license, M.G.L. c. 23K, 128A, and 128C, and 205 CMR 149.00 including, without limitation, all unclaimed winnings and breaks, assessments, taxes, and fees. 149.04: Race Horse Development Fund: Distributions; Escrow Accounts (1) If the commission determines pursuant to 205 CMR 149.03(2)(a) that monies due to a harness racing association or horse racing association from the race horse development fund should be placed in an escrow account, the commission shall establish a race horse development fund escrow account to hold such funds and any interest thereon for distribution in accordance with M.G.L. c. 23K, § 60(c), the recommendations of the horse racing committee, and 205 CMR 149.00. (2) The commission shall establish a separate race horse development fund escrow account concerning each harness racing association or horse racing association for which it determines such an account is necessary pursuant to 205 CMR 149.03(2)(a) (3) The commission shall hold funds in such race horse development fund escrow accounts subject to the following requirements: Monies held in a race horse development fund escrow account shall be held in escrow for no more than three years from the date of the Commission’s determination to hold the funds in escrow. After three years, any monies remaining in such race horse development fund escrow accounts shall be transferred or distributed by the commission in accordance with the recommendations of the horse racing committee. 205 CMR: MASSACHUSETTS GAMING COMMISSION 149.04: continued (4) (a) The commission shall make distributions from the race horse development fund or from a race horse development fund escrow account created under 205 CMR 149.03 because of a harness racing association as follows, in accordance with M.G.L. c. 23K, § 60 and 205 CMR 149.00: 1. 80% of the funds approved by the commission shall be paid weekly to a harness racing association. If there is more than one harness racing association, such funds shall be divided between the harness racing associations at the discretion of the commission. Such funds shall be paid into a separate, interest-bearing purse account to be established by the harness racing association for the benefit of the harness racing horsemen. The earned interest on this account shall be credited to the purse account and shall be combined with revenues from existing purse agreements to fund purses for live harness races consistent with those agreements, with the advice and consent of the harness racing horsemen. 2. 16% of the funds approved by the commission shall be deposited by the Commission into an account for the benefit of the Massachusetts Standardbred Breeding Program authorized by the commission. 3. 4% shall be used to fund health and pension benefits for the members of the horsemen’s organizations representing the owners and trainers at the harness horse racing association’s race track for the benefit of the organization’s members, their families, employees and others under the rules and eligibility requirements of the organization, as approved by the commission, provided, however, that if there is more than one horsemen’s organization, the commission shall divide the amount available under 205 CMR 149.04 evenly between the horsemen’s organizations. This amount shall be deposited by the Commission within five business days of the end of each month into a separate account to be established by each respective horsemen’s organization at a banking institution of its choice. Of this amount, the commission shall determine how much shall be paid annually by the horsemen’s organization to the standardbred drivers’ organization at the harness racing association’s race track for health insurance, life and/or accident insurance or other benefits to active and disabled standardbred drivers under the rules and eligibility requirements of that organization. (b) The commission shall make distributions from the race horse development fund or a race horse development fund escrow account created under 205 CMR 149.03 because of a horse racing association as follows, in accordance with M.G.L. c. 23K, § 60 and 205 CMR 149.00: 1. 80% of the funds approved by the commission shall be paid weekly to a horse racing association. If there is more than one horse racing association such funds shall be divided between the horse racing associations at the discretion of the commission. Such funds shall be paid into a separate, interest-bearing purse account to be established by the horse racing association for the benefit of the horse racing horsemen. The earned interest on this account shall be credited to the purse account and shall be combined with revenues from existing purse agreements to fund purses for live horse races consistent with those agreements, with the advice and consent of the horse racing horsemen. 2. 16% of the funds approved by the commission shall be deposited by the Commission into an account for the benefit of the Massachusetts Thoroughbred Breeding Program authorized by the commission. 3. 4% shall be used to fund health and pension benefits for the members of the horsemen’s organizations representing the owners and trainers at the horse racing association’s race track for the benefit of the organization’s members, their families, employees and others under the rules and eligibility requirements of the organization, as approved by the commission provided, however, that if there is more than one horsemen’s organization, the commission shall divide the amount available under 205 CMR 149.04 evenly between the horsemen’s organizations. This amount shall be deposited by the Commission within five business days of the end of each month into a separate account to be established by each respective horsemen’s organization at a banking institution of its choice. Of this amount, the commission shall determine how much shall be paid annually by the horsemen’s organization to the thoroughbred jockeys’ organization at the horse racing association’s race track for health insurance, life and/or accident insurance or other benefits to active and disabled thoroughbred jockeys under the rules and eligibility requirements of that organization.