 From the horse racing committee, what I'll do right now is I will call the horse racing committee of Wednesday, July 15th, 2019 to order. It is 2.01 pm. What I will do is take a roll call of the members of the committee, I'll call your name and then ask you to just state your name and then obviously state your designation in terms of your representation for the committee and I'd start with Ms. Katana and I'm on my phone here so please bear with me as I'm fumbling but I'm like a tonic and I'm from the Treasurer's Office. Okay and Commissioner Cameron. Yep, Gail Cameron representing the gaming commission. Okay Mr. Savage. Joe Savage, Thoroughbred horseman and breeders. Okay, Mr. Goldberg. Thank you. Peter Goldberg representing the standard bred horsemen and breeders. And I'm Brian Fitzgerald, the chair of the committee. The next item on the agenda is, oh excuse me, I apologize. I do need to make an announcement and the announcement is that given the unprecedented circumstances resulting from the global pandemic, Governor Baker issued an order suspending certain provisions of the open meeting law to protect the health and safety of individuals interested in attending public meetings. In keeping with that order, this committee has convened using remote collaboration technology. There will be a few considerations that I would like to note. Any votes that we will have will be taken by roll call and I will ask each member to register their vote if any individually. And secondly, I'd ask that everybody accept the committee members to please mute themselves to help keep background noise to a minimum. And third, just as a notice to everyone this committee this meeting is being recorded. So we will move on then with the agenda. And the next item on the agenda is the approval of the minutes, which is from our June 3rd, 2020 meeting. And I'd ask if the committee members have had an opportunity to review those minutes. Yes, I have, Mr. Chairman. I have this well. Yeah. Are there any comments or changes that need to be made to those minutes? No. Don't believe so. Yeah. Okay. So I would entertain a motion to approve the minutes with any clerical errors to be corrected as necessary. I would move, Mr. Chairman, to accept the minutes of the last meeting as written. Second. All in. So what we'll do now then is we will take a roll call vote then of these minutes. So, Ms. Katanuck. Yes. Commissioner Cameron. Aye. Mr. Savage. Yes. Mr. Goldberg. Yes. And I register aye. So thank you. Thank you. So the next item on the agenda is the review of the resource development fund updated revenue. What I had asked was that there just be presented to each of the committee members. The updated revenue figures as they are listed with the Gaming Commission. Just to kind of give you some background, there's the 2019 annual report, which kind of gives a summary of all of the total disbursements that were made out of the resource development fund. And then what I would ask the committee members to just do in terms of the packet, there is the full listing. It's about 12 pages of revenue fund. I would ask that you just look at page one, which kind of gives you an indication in terms of the history of the fund as well as all of the allocations that have been made and the actual amounts that have been paid and the balance that is noted. In addition to that, if you look at the last page which is page 12 of that, that kind of gives the updated figures. And as you can see, obviously April and May and I'm sure there's no funds going into, there's no collections that are going into the fund. And so I believe there probably is, and I guess I would ask, is Dr. Lightbound on the call? Yes. Okay. All right. Just I kind of had the figures right now currently is somewhere just north of about three and a half million dollars at this time based on what was located out of January, February, and into March. You anticipate roughly where the fund is at this point? Well, the total fund is on that first page where it's got the 17. The 17. Yeah. Yeah. And obviously there's going to be a we're always, you know, maybe a month or so behind on the payments once they come into the gaming commission and they go out again. So fairly recently, disbursements were made. Everybody should have gotten the money through the March, you know, 15th date or whatever the date was around there that the casinos were shut down. So that money has gone out. Now there'll be obviously the several months break where there wasn't any casino action with no money coming out to the funds. Okay. Do any of the other committee members have any questions about the revenue? No. Okay. All right. Seeing none, then we'll move to the next item on the agenda, which is item four. And again, I guess I would just call on briefly on Dr. Lightbound to talk about the update with respect to the horse racing schedule at this point in time. So I'm happy to be able to report that the Plain Ridge has opened for live racing. They opened down this past Monday, the 13th. Their schedule to run through the end of November, November 27th is their last day. Doing some rough numbers. They've missed about 40 some days due to the COVID. They've got about 70 that are on schedule still. There are some spots in the schedule where we're racing three days a week. So it's possible that Plain Ridge may end up adding some days in there. It would be fairly easy to add another day of racing depending on the horse population. And then there are some months. Once you get into September and October, where we're already going to be racing four days a week, it might be a little more difficult to have the enough horse population then. So right now I'm not sure what their final number of racing days will be. It should be at least the 70. And then like I said, they may add some days in there to make up for the days they've missed. Thank you. Do the committee members have any questions about that? Dr. Lightbound, if I could, I've heard that there's some possibility of the Standard Bridge racing past the end of November. Is that at least the possibility at this time? Sure. That's also a possibility. I mean, harness racing races throughout the winter in a lot of places in Ohio and New Jersey, for example. So it's whether it's not an issue. Is that correct? Well, I know Steve O'Toole really likes to be done by that November date. We do get some weather in December that makes it difficult. And with the shadow that the track projects onto one side of the racetrack, that freezes up a little more than the others. But certainly, you know, they do race into the winter and other tracks. It's a possibility. At least the possibility. Yeah, it's definitely a possibility. Thank you. Any other questions? Okay. All right. Seeing none, then I also wanted to call upon Attorney Grossman. Attorney Grossman, thank you for attending this meeting. I wanted to see if you could just provide us with a quick legislative update, if you will, or you can, you know, in just in terms of in terms of there was certain laws that apparently have been enacted recently. And then just to provide a brief update in terms of the horse race resource development fund legislation. Sure, I'd be happy to do that. Thank you, Mr. Chair. And good afternoon, everyone. Nice to see you all. Let's see, I'll run through all of the legislative items that are on the agenda one by one. So the first two are Chapter 106 of the Acts of 2020. It's actually also known as House Bill 4817. That is what essentially extended the racing laws until July 31, 2021. As you may know, the racing laws have been on a year to year kind of basis for some time now and the legislature and the governor typically extend them by one year periods. Last year, I think it was six months, but this year, it went out to July 31. That covers 128A and C and all of the special acts that allow for the continuation of the licenses of Suffolk Downs and Wonderland and Rainham Park to simulcast and a couple provisions of the Gaming Act that apply to horse racing as well. So that was all extended out for another year through next July. House 13 and Senate 101 are the bills that were actually drafted by the Gaming Commission that would create a new Chapter 128D to replace 128A and C and essentially outline the authority of the Gaming Commission to adopt regulations that cover horse racing, simulcasting and associated wagering in its entirety. It was intended essentially just to streamline the process and to remove any of the special acts and other things that oftentimes make the regulation of horse racing more complicated. But in any event, those did not pass. Those who were reported officially ought not to pass by committee is the actual language that was used. So those that will not become law at least this session. Each House 386 would reduce the 9% of the gross gaming revenue that Section 55 of Chapter 23K talks about that goes into the Racehorse Development Fund. It would reduce that 9% to four and a half percent. It would then take the other four and a half percent and send it to what's called the Community Preservation Trust Fund. That bill, though, was referred to the Joint Committee on Economic Development and Emerging Technologies. The committee held a hearing in November of 2019. No action was taken on it until a study order was issued in February of this year and there's been no further action on that. Similarly, House 387 provided that the comptroller shall transfer up to $10 million each fiscal year if the Secretary of ANF requests from the Racehorse Development Fund and transfer that money into the Community Preservation Trust Fund. That bill was also referred to the Joint Committee on Economic Development and Emerging Technologies. A hearing was held in July of 2019 and a study order was issued in February of this year and no further action has been taken on that. Those are all of the matters that were identified on the agenda. I'm not, I can't think of any other legislative initiatives up the top of my head, but I'm certainly happy to discuss any of those in any greater detail either here or if anyone would like to get us offline or would have you. Thank you. Thank you, Attorney Grosman. Are there any questions from the, from the committee members? Okay. All right. So moving forward then to the next item on our agenda, which is the review and discussion of industry executive summaries based on based upon updated criteria and Racehorse Development Fund distribution and any recommendations. So in terms of process for our discussion, what I wanted to do was see if how the committee members felt about how we should proceed with this discussion based on the executive summaries that have been submitted. I want to first thank each of the representatives from the thoroughbred industry as well as the standard bread industry for their submissions in terms of what they've they've put forth in answering, you know, the questions related in the updated criteria. And I guess for the committee members, I just want to take a sense of where you'd like to proceed. I know that for myself, I have specific questions from what has been submitted under the summaries. And I'm sure you do as well. So I just want to see if the committee members feel should we entertain questions of each of the industries and whether or not each of the industries, you know, obviously, we have two representatives from each of the industries on this committee. And whether they want to defer to their representatives who may be on the call to help with any details that may provide an answer to our questions. Or do they want to hear from each of the committees for a brief period of time and then ask questions? Mr. Chair, I have always found it helpful in the past when the industry representatives that serve on the committee, you know, give a short summary of the presentation and why the points that they made in their executive summary, what they think is valuable for us to really pay attention to in making this decision. So I've always found that step helpful to have them talk through briefly their summary and making the points that they deem. And some of our questions may be answered with that short summary. Okay, all right. From my view, may make a lot of sense. I'm thinking that we want to do it category by category, like Peter will speak about the 80% purse bucket, and then I will, then maybe we pause or maybe we go to the next one. But I think it's probably not given our new methodology useful to go through the whole three of them and then the whole three of them. That makes a lot of sense. So you'd want to take a category by category. That would be my suggestion. Okay. All right. Okay. All right. Attorney Goldberg, are you? I'm fine with that. Yeah, I chuckle at Commissioner Cameron's idea that two lawyers can be brief. Well, you noticed I kept emphasizing that just to make the point. That's why I divided it into three buckets. It won't seem like one long oration. That was, you stole my thunder as that was going to be my opening line about trying to not just rehash reams of statistics. Correct. I agree 1000%. So yeah, that's fine, Mr. Chairman. All right. Okay. All right. Mr. Katonik, are you okay with that process as well? Yeah, I'm okay with that approach because I think we're hearing from both thoroughbreds and standard breads that they're open to splitting bucket by bucket. So I'd be okay with that. All right. Okay. All right. So then if we're going to take a category by category, then I would ask, which category do we want to start with? Do we want to proceed with talking about health and welfare benefits? First, or breeding or the first allocation? I think the executive summaries ended set up as first breeding and then health and welfare. And that seems logical to me as an order. All right. Okay. I would I would agree with Tony Tillich. So we'll begin then. And I guess in terms of starting then, why don't we start with the Mr. Attorney Savage? Why don't you begin speaking about the thoroughbreds position in terms of their executive summary on the first allocation? Sure. So just stepping back where we are at the moment, overall, for the race, is a 65-35 split across all categories. And our overall request to the committee today would change the overall split of 59.2 for the standards and 40.8 for the thoroughbreds. So that's like the aggregate numbers. Because, you know, thinking about this, you've got two breeds, you've got to mandate to develop each breed. And sort of distinctively, as a matter of common sense, 50-50 would be the starting point. And then there would be reasons to vary from that. But overall, our recommendation is accepted as the each category does a modest change from 65-35 to 59.2 to 40.8. As to the first allocation category, the thoroughbreds are not asking for a change. In that one, 65-35 standard-bred thoroughbred, you know, this is that alone, if the committee were to adopt it, gives the standard-breds more than half of the entire racehorse development funded at 52%. And there, you know, really should be a good reason for the committee to put their thumb on the scale that way. And we're not objecting to it because the historical analysis of this category and Mr. Goldberg's been the primary proponent of it. But I agree with it is you compare the last three years to each other. Now, what's comparison here is how do the numbers in 2018 look as compared to the numbers in 2019? And there's been no material change. While we may disagree as to how the committee got to 65-35, there's nothing in the record that would give a reason to change it when you compare the relevant metrics of 2019 to 2018. There's some additional reasons not to change it. One is that giving a larger percentage to the standard-breds has not and will not increase live handle. This committee back in 2014 hired an expert, Dr. Ray, and she found in her report that for every 1% that you increase live handle for the standard-breds, it's .075% or every 1% of purse leads to .075% increase in handle. Another way to look at that is the GTR numbers. Don't move at Plain Ridge on race days. And with like $1,270 or $1,300 in live handle on each race, it basically confirms there's no one there, which it's not a thing that changes depending upon the person. So that would be an ineffective expenditure of money if you were to increase their purses. A second thing that's meaningful to the benefit to the Commonwealth is where does the purse money that you give standard-breds go to? And it leads to money going large in the out-of-state. If you look at the 2019 from the perspective of horses, 47% of the standard-bred active mass breads were owned by mass residents. So most of them are owned by non-mass residents. If you look at it from the owner's perspective, only 25% of the mass standard-bred owners are Massachusetts residents. So the money that goes there won't have a positive impact and won't stay in the Commonwealth. And there's no benefit to give it to them when by doing so, it erodes the incentive that the thoroughbreds have from their 35% piece to encourage investment in a new track. And you heard the testimony of the various people that are engaging in developing thoroughbred racetrack. And we've been conscious of this all along. I mean, we could have gone to the Commission for higher purses in 2019. And it would be consistent with other racetracks around the country. But we didn't, in part, to be responsible of preserving that fund as an incentive for investment. And, you know, fortunately, there's been a little bit of good news last week. The Sturbridge Project was voted on by the selectman affirmatively out there. So that moves to the next step of the conservation committee. So there's, there's activity there. And as the people testify, that's dependent on this fund being available. Um, the Interbred Executive Summary has a couple of arguments for, for an increase. First, they say on page three that the thoroughbreds did not spend any of the racehorse development money in 2019. And that's not accurate. I mean, we, everybody knows we had six racing days, and we see Alex's numbers and, and so we spent money from the Racehorse Development Fund that the Gaming Commission gave us. And, and both for the actual live racing on the six days at Suffolk. And another $600,000 to support the breeders in their racing at Finger Lakes. They, they make an argument in their executive summary that, that basically says the thoroughbreds get enough from ADW and simulcast. Um, and to finance all the purses out of that. And that they've apparently assumed that's what the thoroughbreds are doing. And, you know, once again, that's inaccurate. Um, you know, historically thoroughbreds got three to seven percent of simulcast and ADW. But after Suffolk closed, it's 0.05 percent. There's no money there anymore. And what money was left over about $800,000 was used by the thoroughbreds in 2019 to put on the event, like to pay for use of Suffolk Downs and folks that worked it and whatever. I mean, none of that money went to purses. So this is just a kind of, I don't know where they got this idea, but it, it also is, is inaccurate and not, um, a reason to increase their share. Um, they say on, on page four that, that, um, it should be looked at that, that the race days are, are a significant benefit to the Commonwealth. And the actual argument just to quote it is, there's obviously a much greater economic benefit to the Commonwealth from 153 SB training racing trainers racing 108 days and stabling slash training for 300 plus days as opposed to 125 TB trainers racing a grand total of six days in Massachusetts and then there's a helpful exclamation point. Um, so the implication of that paragraph, which is incorrect, again, it's not accurate, is it implies the horses are here for 300 days and they aren't, they almost all ship in and ship out and the standard breads have given no actual data on that. They just assert, as they say in that paragraph, it's obviously a much greater economic benefit without demonstrating it. Um, they, they cite their own expert report they say at page five and six tables six and seven for the concept quote obviously much greater economic benefit. So you go to the expert report expecting you to say something like obviously much greater economic benefit but what their expert actually said is and I'll quote it quote however even the limitations discussed above regarding active versus issued licenses for the 2018 season we have no method to quantify racing related employment for each sector. So it, it's actually the opposite of obviously economically beneficial. Their expert was candid that they have no method to quantify racing related employment for each sector. Um, their final argument or next argument is that you know even though they're already eighth in purses in the nation they need to be even higher up as compared to other racetracks and I see Mr. Goldberg shaking his head because I think they say they're 11th to 14th but whatever the, the, whatever the number is the point is they say there's an economic development reason for the commonwealth for them to be higher comparatively to other racetracks. Now they, they don't give any data or rationale as to why moving from wherever they are on the list the number one would in any way benefit the common, I mean we know it won't lead to an increase in life handle. We know it won't lead to an increase in in-state ownership. It won't change race days. It'll just mean by increasing the purses that way more Massachusetts money flows out of state. So I think the four arguments they make, three of them are inaccurate and two of them are unsupported. And the fact that back to the bottom line there is no change in any relevant metric from 2018 to 2019 that as to this category the committee ought to leave it right where it is 6535 in their favor. Thank you Attorney Savage. Attorney Goldberg. Thank you very much Mr. Chairman. So I am going to try to be brief and and again not go through either of our arguments in detail because there's been a lot there's been executive summary provided by the industries. There's been a position paper presented by the industries and then all the metrics in the outline provided by both industries. And I know everyone in this committee is good at reading and can figure the math. The gaming statute was passed back when it was passed to help Massachusetts and its communities and its residents. We didn't institute gaming in Massachusetts to help any industry. It was helped to bring in it was it was passed to bring in financial revenues to education for teachers to the police and firemen in the communities and for general funds for infrastructure repairs and updating. There were tons of hearings votes required of all the towns that were going to get gaming in their communities that had to pass. All the host communities had to have me hearing after hearing about these issues. The Mass Gaming Commission didn't give didn't give Steve Nguyen the first license casino license because they liked Steve Nguyen or they liked his company. They gave it to him because at the time they felt that Nguyen was was able to do the best for Massachusetts to bring in the most revenues from Massachusetts not to be the best gaming company out there. The Resource Development Fund is part of the gaming statute. It wasn't it's not a statute designed to to bring horse racing to Massachusetts or only to prop up an industry. It was there to maximize benefit to Massachusetts the local towns residents and to encourage investment and reinvestment in Massachusetts by the all the shareholders the stakeholders in both horse racing industries. The metrics are clear. If you look from when we started our first meeting in August of 2012 till today every single metric for the standard breads has gone up and every single metric for the thoroughbreds has decreased. It's just the way it is. If you look you know 2019 standard but only received a smidge over 60 percent of the Resource Development Fund although it's now 65 percent that wasn't enacted until November last year so there's been very a little extra money. Live race days this committee determined years ago is very very important. Standard breads continue to increase them not only increased live race days but the number of races. thoroughbred obviously their race days from 2018 to 2016 was down from eight to six so it was down 25 percent over that one year. The standard breads are using all their money. The point about the thoroughbreds not using the money is they have a surplus in their account. Whether that money they use this year was from this year's allocation or from 2014 doesn't matter we don't know. I understand the Attorney Savage's point but the point is as we go forward every dollar that's going to go to this thoroughbreds for purses is going into a slush fund into their escrow account. It's going to be attacked again. Why wouldn't it? It's been attacked as we heard from Attorney Grossman. The House bill is already trying to take ten million a year away from the Resource Development Fund. Another bill that's trying to reduce the nine percent to four and a half percent. These are real things that are happening because that money is on the thoroughbreds side is not being used. Purses are not being used. The unfortunate reality is there are no race states in Massachusetts in 2020 for thoroughbreds. Their needs for purses are zero. They don't need any more purse money. I mean it doesn't get any more basic I think than that. The occupational employment numbers what that what the expert was talking about was we don't know exactly how much each person made how many days they work so it's hard to compare apples to apples. We can't compare apples to apples but my point was very simple. Let's use our common sense because I think we're allowed to use our common sense in this in this uh what we're trying to figure out here. The common sense is if you have 150 standard-bred trainers racing 108 days that might bring in more economic benefit to Massachusetts than the same number of thoroughbred trainers racing six days or racing no days. It's just obvious math. Most of the horses don't don't ship in that's not true. Most of them are stable in Massachusetts. There are a lot that ship in and that's a good thing for Massachusetts. And I mean I could I could take one of the one of the last things I wanted to talk about was the HHA and the membership. If you look at the executive summary that that was provided a good very good point was made. If you look at the membership statistics and it's on page nine of the executive summary from 2014 to 2018 what you see is the number of Massachusetts residents who are members of the HHA&A has increased 24 percent since 2014. It's gone up not down it's more Massachusetts residents are involved in harness racing since 2014 by 24 percent. But if you also look the attestate members increased by 229 percent that's a very very very good thing. Why is that? Attracting outside of investment for any organization is a good thing. I happen to represent a non-profit do a lot of fundraising going to the local people in our in our organization it's okay but there's only so much you have there. Getting people from outside the organization to invest is where it's at and that's what the standard industry has done really in a terrific fashion since 2014. We've gotten outside people to move from New York, New Jersey, Delaware, Maine to move their operation and race in Massachusetts. Not a bad thing it's a great thing. They're taking them or they're driving to Massachusetts to race. They're buying gas at Massachusetts gas stations, they're buying feed, they're using the equipment guys in Massachusetts, they're using the veterinarians in Massachusetts. So that's all a good thing the occupational numbers um again are just common sense. The life handle issue is a red herring folks. Life handle is small potatoes. The money that the Kamuov gets from gambling at the races is de minimis. The take I don't know maybe you can correct me Joe that the takeout on these bets is about maybe 10% on average so if a million dollars is wagered it's about a hundred thousand to the Kamuov. So when the thoroughbreds handle was a million about a million five last year it brought in about 15 about 150,000 to the Kamuov. This is de minimis. We're not trying to attract gamblers to Massachusetts. We're trying to attract employees, workers. Go to a racetrack. I invite everyone here. Come to Plain Ridge and you'll see who's out on the apron betting on the races. It's old men. That's who's there. Old men. We're not trying to attract more old men to bet their dollars on their wage on the races. Now go to the backside which is the barn area of the racetrack. You're going to see probably more women than men and a lot of young people working as grooms, cleaners doing every job as veterinarians, trainers, drivers. That's who we're trying to attract into the Massachusetts because those people are spending money that's effective from Massachusetts revenues. That's what helps put the dollars into the back into the schools and the firemen and the police and all of that. So the live handle and if you look at the live handle I mean okay since 2014 live handle the third red live handle has been down 23% annually. The standard hand handle has been up an average of 7% annually since 2014. I suggest it's really a red herring though. I'll just finish up about relative needs. We're not eighth in the... My brother says or is his summary states that we're eighth in the nation. Eighth highest in the United States. That's far from the truth. We're 11th in the northeast region and if you take just tracks of the same size we go down even further. We're also still four million dollars less a year of the average harness racing track in the northeast. So why is this important? In order to attract the investment from the people in New York, from the people in Rhode Island, Delaware, Maryland, Ohio, wherever it is to get them to move their brewed marriage to Massachusetts, to get them to move their resources to Massachusetts, to drive in on Mondays, Thursdays, and Wednesdays to race to Massachusetts, we have to offer good purses. They have to be competitive. Why would you drive to Massachusetts to race for less money? It doesn't make sense. So it's important especially in light of the COVID. Look, we're the only game in town now. We have to pay purses this year folks. We have to pay them. We can't afford the purses to go down as the momentum has been going really well for the standard bred industry. It's going well. It's like the same old thing. It's going well but there's a long way to go. It's a long way to go for the standard breads and we have to keep the momentum. It's very, very important. So that's all I'm going to say about the purses. I think it's, you know, I could sit here and I could, with all my honesty and good intention, say we deserve 100% of the purses. Why couldn't I say that? The thoroughbreds aren't racing in 2020. They're going to spend zero on purses. We now have to make up a shortfall because the casino everything was closed for three or four months. So the Resource Development Fund is going to be a lot less this year than last year. Yes, we're going to race less days but the horsemen are trying hard to get as many of those days back whether it's racing extra day a week or racing more days because December and January are days that can be raced. I understand that there's people that don't want to race in the winter time, those being the racetrack themselves, but the horsemen would like to and they're going to try to. And I think it's really important not only to keep the amount of the purses the same but to try to keep that momentum going and increase them. So I could ask for 100%. I probably should ask for 100% to be honest because I think the more that we put into an escrow account is just giving ammunition for others to go ahead and take it. And I think it behooves both industries to not keep putting money into an escrow account that might be used someday. I think though, you know, to be, to hear what they're saying, to hear what Attorney Savage is saying, I think somewhere in the 85 to 90% low for purses would certainly be fair. Thank you, Mr. Chairman. Thank you, Attorney Goldberg. And Mr. Chair, was it your vision that I would be able to respond or that our industry representative would speak or how did you think we should handle this? Well, in terms of in terms of rebuttal, I guess I would say, you know, if there are points that you want to address, you can address those points, but I do want to try and also move on for any questions that the other committee members may have. So then I'll take a 30-second shot at it and you can cut me off and you can cut me off at 30 seconds. Again, the focus is 2018 versus 2019. The race days are essentially the same for both breeds and all the other metrics are essentially the same. If we were six versus eight, they were 110 versus 108, so nothing changed. The purses, you either accept the idea that it encourages investment or you don't, so there's no reason to belabor that. The common sense argument about it, there's trainers hanging around coming in and out of this state for 100 days. You know, the actual, this metric you can look at, which is W-2s. I mean, there's people employed and you can look at it and that favors the thoroughbreds. As to the increasing membership in the harness race association, that's folks paying 35 bucks to join an organization, you know, where you can get a 10% discounted holiday and express. That is not yet connected to investment. Like if Mr. Goldberg has data on investment, that's great and it's probably relevant to the committee, but the fact that people paid 35 bucks a year to join a racing association doesn't do it. The importance of live handle, that's not me talking, that's the expert this committee hired in 2014 and it's a measure of whether the product is attracting customers. And customers are benefit to the commonwealth. They stay in a hotel, they buy a meal, they do a thing. It's true that apparently standards are not expanding their footprint beyond elderly men, but that's part of the problem. That's why you wouldn't throw more purse money at something that's not expanding. Thank you. Mr. Chairman, if I could take 15 seconds to reply. Sure. Dr. Ray's report was done in 2014 or 15. At the time, this committee, and I think Commissioner Cameron can back me up in this, spent hours and hours not only reviewing that report, but we were on a conference call with Dr. Ray and questioned her. There were, there were error after error after error in her data. There were many mistakes and we basically as a committee decided to discredit the report and not give it any weight in our decision. And that was back in, whenever it was written, 2015, 2013. I think it was before the 2014 votes. It had to be around 2013 or 2014. So the reliance on Dr. Ray's metrics don't work. Okay. Other committee members, I guess I'd ask if you have any questions about what you've just heard from each of the representatives of the thoroughbred and standard red industries. Commissioner? Yeah, Mr. Chair, I just had a couple of points really. I don't know that there are actual questions, but I think Mr. Savage's point about employment numbers. I do think that's difficult to make that argument because how long are these folks employed? So W2s may not accurately reflect that. If you're employed for two weekends as opposed to a full racing season, I do think that makes a difference. When we talked about the standard bread need for more purses this year, the one point that we didn't make was that there is a significant amount of carryover money going into this season that really can replace the monies that were not being made early in the season. And I think Dr. Lightbaum probably has the exact number, but it's a significant amount of money that was carried over for purses this year. And we received that information earlier in a presentation from Mr. O'Toole to the Gaming Commission. And I think when we talk about standard breads not attracting a new customer base, I actually think that probably applies to both breeds. Frankly, that the older gentlemen that were mentioned, I think we would see those older gentlemen at any of the simulcast facilities, whether it be a standard bread or a or a thoroughbred. So it just I think that argument applies to both sides. So just a couple of points I think that we that weren't talked about yet. So thank you for that, Commissioner Cameron. The W2 people are year-round people. They're tellers, their wait staff, whatever. The people who came in especially for the festival were 1099. So you're talking about the standard bread. You're talking about the simulcast folks that are there. Okay. I didn't realize you were both live racing. If you were, I think you might have been, or I don't know if you were at the festivals in the past six days, but the crowd was not elderly. There were 10,000 people there and there were young people and all the kinds of people. And when I go to Saratoga and I go to Del Mar and I go to Keeneland, thoroughbred racing is in a dramatic transformation in terms of the age demographic of who's coming out. I don't know that it's, well, I guess I was talking about the most of the year with thoroughbreds. We're talking simulcast normally. So I'm talking about that population. I do agree that a festival is a bit different because it is a festival. It's not every week racing. And the crowds that were there when there was full-time racing at Suffolk Downs was diminished as well, frankly, when it was a full-time racing season. Understood. Mr. Chairman, can I make one comment, please? Another big issue that, you know, when Chinese Savage talks about the tellers, the simulcast tellers and those people who are working in the simulcast, those people are not included in our numbers for the standard-bred side. When Plain Ridge Park was taken over by Penn Gaming, all those people became employees of Penn Gaming, the tellers, the guy running the hot dog stand, the restaurant workers, the cleaners, all those people are not in our numbers. If we go back and add in the Penn Gaming employees that work at Plain Ridge Park, the numbers will be off the charts. Actually, my memory is, to compare apples, you've got to be careful and look at it that way as well. My understanding was there were four people that went over from the racetrack to Penn Gaming. Well, that would be incorrect. Attorney Katana, do you have any questions or comments for either of the representatives? No, thank you. This overview was very helpful. I do have a couple of questions. I guess, Attorney Savage, if you need to, in terms of if Mr. Umbrella was on the call and you want to have him kind of help elaborate in terms of the answer to this question, that would be greatly appreciated. One of the things that I noted from the executive summary was essentially that we had asked as one of the criteria questions of the total purse allocation, how much did each industry not distribute of the above allocation in the past year? And the response from the thoroughbreds was that it was estimated that somewhere around $4 million was not distributed. And then the comment in that section was we could have asked for more purse money but chose not to in order to have a reserve necessary to attract investors for future full-time racing. So I just wondered if either you or Mr. Umbrella could elaborate on that just in kind of terms of telling us the thought process behind that is my calculations show just based on what's been submitted that the total purses at Suffolk Downs last year would have been somewhere just north of $3.5 million. And the total allocation for purse funds from the racehorse development fund was just north of $5 million. So I just kind of wanted to get some further thoughts in terms of the rationale behind not requesting those purse funds and setting them aside. So thank you very much for that question. And since you're asking rationales and thought processes, I'll let the people who had the thought process answer it so far. I'll defer to Mr. Umbrella. Okay. All right. Am I off mute? No, you're on. Can anybody hear me? I believe yet we can hear you now. Thank you. Hi. Thank you, Mr. Chair, members of the committee. Yeah, I do admit with all the criteria we were going through and had to go through and in my mentality, I weight this. So initially, you're correct. Out of the $5 million that was allocated, I took from the total. We did pay just close to $3 million. So the difference would have been $2 million. But I didn't weight this as a heavy factor in the decision on determining the split of the purses. So I went off the total allocation of about $5 million, the $7 million, less than $3 million. So it was $4 million or $5 million. So I was just quickly estimating trying to gather all the data from all the different data points and put that together. And as the members of the commission know, when we ran the festivals, we could have asked for significantly large amounts of purses or run for more money. As Alex and all the racing directors, some felt that might have been excessive, but we could have just that. We've put a ran for more purses, tried to run for more races throughout the day, but we had restrictions also with Alex and the racing director when we could start, when we could end. So we kind of, our hands were bound in tight. So yeah, actually the full million, you can take that down to about the $2 million or less. But again, it's what we couldn't use based on the number of days and the purses that we requested to race on those number of days. Did that answer that question? Thank you. Thank you. And would committee members have any questions from that response? No. Okay. Okay. Thank you, Mr. Umbrell. I might get, I'll meet myself back. Thank you. I have a related question, Mr. Chairman, to Mr. Goldberg, if that's permitted. All right. Well, why don't we, go ahead. So following up, Mr. Goldberg on what commissioner Cameron said about the significant carryover, that's about $860,000 that the standard have available for purses right now according to Mr. O'Toole's testimony last week. Was that money that was resource development money that was not spent? I'm not sure. It was the earmark from the resource development fund. It was from the purse fund. My understanding is that was a calculation mistake by someone in putting the purses together for the races at the end of last year. So that's my understanding that it wasn't an intentional carryover for any reason. I'm just confused by your executive summary says that there's zero that wasn't spent and Mr. O'Toole says there's $860,000 available. I'm just trying to figure out if that's other money or that is money that wasn't spent. Do you want to address that, Mr. O'Toole? I see Mr. O'Toole's on the call. Would you like to address that? I can if you can hear me. Yes, we can. Yes, gotcha. So I know Peter likes to think that I make a lot of mistakes, especially when I was training his horses, but never. But this was not a mistake. This was much more calculated than Mr. Rambella's calculation. We were going from 108 days to 110 days for this coming season. And with the opening of Encore and the diminishing revenues at Plain Ridge of about 15% at the start, we felt that in order to keep our purse account level that we needed to carry a little bit extra, excuse me, money into 2020. In 2019, we carried 400,000 into the purse account. And so it really was just another $400,000 going into the 2020 purse account. That money is not specifically racehorse development fund money. This purse account has been a rolling purse account before pen gaming took over and after pen gaming took over. So every year there's either a shortfall or a surplus because it's impossible to estimate, especially with the way the racehorse development fund payments come in, as Alex had mentioned earlier, that they're a little bit behind as they work through the process. So we estimate as best we can. And we wanted to carry over a little bit extra money going into 2020, not seeing the pandemic on the horizon, but definitely thinking that there might be a little bit of a shortage and we wanted to keep purses as level as they could from year to year. So it was very calculated and what we did, it was not a mistake. And it is not racehorse fund development money specific. Our purse account is comprised of premiums. It's comprised of percentages of ADW. It's comprised of percentages of simulcast handle. It's comprised of live handle and racehorse development fund. What percentage is racehorse development fund? The actual percentage, I don't have the off top of my head, but all of those funds contribute to our total purse account. And I'm sure at Suffolk Downs, the monies that are generated there, I'm sure they go into their purse account as well as all the racehorse development fund money. And the premiums that we pay over there is at about $300,000 a year. Thank you, Mr. O'Toole. I appreciate you correcting my speaking. Thank you. Thank you very much. Thank you. All right. So are there any further comments or questions on the purse allocation category? Hi, this is Paul again. Can I just make one other comment that's related? All right, sure. We'll allow you to do that. Yes. Yeah, just two seconds. There's a misnomer and Council Grossman knows this. I keep hearing that our funding is escrowed, and it's why I apologize where I didn't focus and sharpen my pencil on this number, $2 million, $4 million. That money's not in our account. That money's not escrowed. And it's one of the requests we keep making to the commission is it needs to get escrowed to protect the thoroughbred industry and the investors. So I want this committee to understand that, that I keep hearing or Mr. Goldberg makes a reference, it's protected. It's not protected. Thank you. Thank you. I can just confirm that that is true. The money is not escrowed. It's sitting in, it's in the gaming commission account and set aside. Thank you, Attorney Grossman. No, and I never said I was protected. If you misunderstood me, Mr. Umbrella, that's exactly opposite. I think these monies are not protected, and that's a big point. We keep putting money into that unprotected category. It's going to go bye-bye. So I think that's why more money to the purses, to the thoroughbreds is not a good thing. According to the statute, the commission has the authority to consider that money, and we'll be addressing that to protect it. And I use reference, it's escrowed. So when I'm questioned if I'm not spending money, I can't spend money I don't have. That's all my, my rebuttal was. So whether it's $2 million, $4 million, or $10 million, it's irrelevant. $10 million came in, we only asked for $2 million to raise. Could we have asked for $4 or $6 or $8? Absolutely. But we didn't, we didn't want to be excessive, and we wanted to actually preserve it and continue to do that. Thank you. Thank you, Mr. Umbrella. Okay. All right. At this point in time then, if the committee members, Mr. Goldberg, did you have another comment or no? Okay. No, I'm all set. Thank you, Mr. Chair. Okay. All right. If there are no further comments or questions, then I would open it up to the committee members to discuss whether or not they feel that there needs to be any adjustment in terms of the allocation of the PERS funds at this time. You've heard from Attorney Savage and myself, so I assume you're talking about the other members like me. Correct, correct. Yes, yeah. Commissioner Cameron? So, Mr. Chair, so it looks like the thoroughbreds are saying keep it where it is, and they have their rationale for that, which is 6535. And if I understand Mr. Goldberg, because it isn't in the paper an exact percentage, but now he's, I think, saying 80% would be appropriate. So we're looking at a difference of a 15% between the two position papers and executive summaries. I'm sorry, Commissioner Cameron, I don't mean to, I did say 85 to 90%, I thought. You said 85, I'm sorry, you did. I said, I think we could ask for 100% would be completely within the realm, but 85 to 90 would be fair. Yeah, and I, another point that I do think is it's easy to get ahead of ourselves and say 2020, but we really are looking back, right, to 19. And I, when I do look, I do think there aren't many changes from 18 to 19. So I know that in 20, it's a different story because of the racing days will significantly change from one year to the next. But as far as 18 to 19, all the factors that we've seen thought are important over the years. And with this make up as well, last year's committee meeting, I just, I don't see a lot of changes to talk about that big, that big a swing in, in the percentages. Mr. Chairman, can I just address the changes question? Commissioner Cameron, were you through? Yes, I am, Mr. Goldberg. Thanks. So the changes since the last split, which was November, was one is the thoroughbreds last year said they'll be up and racing within a year. They're not. That's a change. The money that's being kept by the gaming commission, the thoroughbred purse money wasn't, has now become a target of a mass legislature. That's a new change from 2018 to 2019. The breeding numbers, the breeding that, well, I know breeding, we're not talking about breeding now, but it's, it's breeding numbers that's changed dramatically. Suffolk Downs is stop racing. And then we're not looking at 2020 numbers, we're looking at relative needs as a purse, as a purse metric and the rally, you can't close your eyes to the, they're not racing. So there's no needs. It was more racing at Fringale Lakes from 2019 to 2018. And it's just the race days from eight to six is 25% reduction. I know it's not from 3000 to 2200, but they, thoroughbreds were reduced by 25% from 2018 to 2019. So 25% reduction, if you take away 25% of anyone's salary or income, it's a big one. So I think it's a, it's, it's a major change from 2018 to 2019, albeit the number is not huge and I understand, but the percentages are very much changed from 2018 to 2019. Thank you. Well, if I might just very briefly, the, with the exception of whether six to eight is a big change, which seems ludicrous to me, frankly, given the live handle that was generated, the purses that were paid, the people that attended, it was, it was no change. The other things that Mr. Goldberg cited are not metrics for this committee to consider. We had a meeting a month ago or whatever it was and set the metrics and metrics are like, not the dollars might be a target or they're not going to run next year or Suffolk doesn't live here anymore. Those are not the metrics. So I think that's actually a concession that when you have to go to someplace that isn't the question to give the answer, it tells you all you need to know about what the writing answer is to the differences between 2018 and 2019. Attorney Katana? Yeah, I mean, I would say generally that I share the concerns that have been expressed about the funds being swept at some point. And I understand Commissioner Cameron's point about sort of the relative change year over year. But I do believe that we landed on sort of the 65, 35 split and that that was an increase, not necessarily because it was reflective of, you know, the status of the industry, but because we wanted to be sort of cautious in our approach in terms of increasing or changing the split year over year. So I guess all things considered I would be more open to a discussion of a small moderate change to the split, not something sort of maybe as drastic as has been proposed. But I do think that I would be open to it. Okay. Thank you. And I would just echo that I think one of my concerns is and Mr. Savage, I'll give you an opportunity to just kind of further respond. But I think one of my concerns is the allocation that was made to the thoroughbreds. Just the concern of the, you know, setting aside those the reserves, mainly because, you know, to me it seemed as though and the figures could be argued based on what's there. But, you know, anywhere from roughly, you know, only whether it's 21%, whether it's half of it, that was distributed for those purses. I just, I have a concern about that, about the funds not being distributed for their intended purpose in terms of, you know, funding live races. And I just, I guess it just, I mean, it was, you know, in terms of what I've heard, it was, you know, in essence, just a conscious decision to say, well, we're going to set these aside for those reserves. So it was an iterative process with Alec and a discussion of what was reasonable under the circumstances. There are race tracks around the country that have the same, a similar situation and run festival racing such as Kentucky Downs that offers a million dollar purses for each race. And I happen to have a horse that won one of those races. So it's a lovely thing if you're that person. But that may not be the best economic, but there's no question here that these funds are being held for their intended purpose. And the intended purpose will be purses when we have a thoroughbred track up and run. And you heard the testimony of the investors, this is relevant. We did in conjunction with Alex, a setting of the numbers that we thought were reasonable and not pigish. And we knew that the balance leftover would be incentivizing investment. And again, if people don't accept the incentivizing investment argument, then I get why they would consider moving in the other direction. But I think we heard people discuss that it's real. And it just to me is common sense that it's real because this is a development fund. And what development often is, is placing a bet on future of what the project might be and etc. So that's that says I understand it. Just to use your words, Attorney Savage, I don't believe incentivizing investment was one of our metrics either. Relative needs of debris. That's exactly what I said. Your relative needs right now for this 2020 are zero. So then is there any further consideration on whether or not the application needs to be adjusted at this time? Are you looking for discussion, Mr. Chairman, or a motion? If there's a motion to be made, a motion can be made. Well, let me say this. I would agree with Emily's comments that just dealing with metrics and the concern on the back end with a pot of money that is may not be protected. But the Emily's thought was that a modest increase. I don't want to put words in her mouth, but it was she would consider. So I certainly would consider as well a modest increase. It looks like we're going in that direction. My point here is that I'd be more comfortable with modest than I would be with with a big swing the other way. Modest has traditionally been defined by this committee in our past practice as 5%. It has. I would suggest since we're talking numbers and modesty, we're only talking about 80%. When we talked about 5%, we never defined modesty as 5%, but we use 5% as the movement per year. That was almost based on 100%. Now we're talking about an 80% bucket. So that's a little different. I would suggest in the interest of hearing what Ms. Katanaka said and Commissioner Cameron, you know, I've requested 85% to 90% increase in just the purses. Thoroughbreds have asked to keep it the same at 65.35. I would concede I would make a motion, Mr. Chairman, that the horse racing committee would change the split of just the purse allocation, the 80% purse money, from 65.35% to a 75.25% favoring the standard breds. 75% to the standard breds, 25% to the thoroughbreds. And I think Commissioner Cameron, this concession, which I heard you talking about, is right between my 85% to 90% request and the thoroughbreds request of keeping it at 65%. So just so we're all on the same page, if you increase it to 70%, that means the standard breds will get 56% of the entire resource development fund just in this category. If you move it to 75%, it means they're going to get 60% of all the money for resource development in this category alone. This is the main, this is 80% of the fund, of course. So there's a motion then, the motion as I hear you then is to change the allocation to a 75% to the standard breds and 25% to the thoroughbreds. For the purse allocation only. Is there a second to that motion? I think I'm more comfortable with a, I would be more comfortable with a 5% rather than a 10% increase. I do believe there is value to having some monies for new investors. I do believe that. I know that that's not a set criteria to look at that, but in the general category of relative needs, I do, and I have over the years given some value to that, to that point. So I would be more comfortable with a 5% increase than a 10%. I move that we change the allocation to 70, 30 in favor of the standard breds. I will second that motion. Is there the motion being moved then based on a 70, 30 split or allocation based on the purse allocation? I guess we'll take a roll call vote on the motion. Attorney Katanak? I. Commissioner Cameron? I. Attorney Savage? Yes. Attorney Golder? Yes. And Fitzgerald? I. So the motion being carried, the allocation would be changed for the purse allocation to a 70% to the standard breds and 30% to the thoroughbreds. Thank you. So moving on to the next category, talk about the breeding programs. I will start with Attorney Goldberg on behalf of the standard breds. If you want to make some brief comments with respect to the breeding programs and the executive summary that was submitted. Thank you. Thank you, Mr. Chairman. So I'm going to try to be brief because I know we're running long. I think it's important first to think about what breeding is. It's not a joke. Breeding is taking a mare, introducing it to a stallion, having a baby, raising that baby, getting that baby to the races and raising that baby. That's what a breeding program is. Breeding. You can look up Marion Whipster's dictionary. That's what it is. That's breeding. The thoroughbreds have no breeding program in Massachusetts, essentially no breeding program, and haven't had it for years. The standard breds have. And you want to talk about 2018 to 2019? 2018, there were 116 registered brood mares. And the only register of brood mare when you're going to breed it to a stallion. 116 in 2018 to 141 in 2019. 99 foals were born in 2018. So far 2019 has been 98 registered. 2019 foals and the registration still goes on until the end of the year. Standard bred breeding program has done very, very well in the last four or five years. It's very important to understand the thoroughbreds are not paying money to any two or three-year-old young horses. They're paying breeders awards, stallion awards, aged horse awards. That's fine. They're entitled to do that. There's no issue with that. But that's not a breeding program. There's no reinvestment. If I breed my mare today, three years down the road, there is a baby. The baby becomes two years old and about three years and four months after the mare's bred, the baby races at two, the baby races at three. This is standard bred horses. Once that horse turns four years old, there's no more money. There's no more mass bred money. If I want to stay in the mass program, the breeding program, I have to breed my mare back to another stallion. Every year, that's how you stay in the Massachusetts breeding program, the standard breds. The thoroughbreds, since they pay, whether the horse is two, three, four, five, six, seven, eight, or nine, I can breed my horse, race at two, race at three. I don't have to breed but my mare back. I can just race that one horse I have and I can still be getting paid. Most of the money that's being paid out, I think there are a couple of three-year-olds that actually mass bred thoroughbreds at race this year, but most of them are aged horses. It's five-year-olds, six-year-olds, eight-year-olds, nine-year-olds, and that's who's getting paid. That's not the case. And the reason why the breeding program is important is because it's labor-intensive. It's an industry that brings a lot of benefit to Massachusetts because to breed a horse, you need a lot of open space. You need a lot of veterinarian care, a lot of feed care, farrier care. It's a lot of care and taking care of those babies, taking care of a pregnant mare, taking care of a young foal. I've done it myself. I pulled the foal out of the mom, stood it up and taken care of it. A lot of nights, midnight taking care of these things. It's a very labor-intensive process. The thoroughbreds talk about the cost of thoroughbred breeding. I suggest the costs are not that much different. He talks about stud fees. The average stud fee is $40,000 for a thoroughbred and whatever it was for a standard, $4,000 for a standard breed. That's irrelevant. They're not breeding in Massachusetts. There were two stallions registered in Massachusetts for thoroughbreds. They're not doing anything. One stud fee is $2,000 and one stud fee is less than that by private breeding, so it's probably $500. The standard breed, and both industries have resident mare programs. The resident mare program, you can breed your mare stallions from outside of the state. Both can do that. The discussion between live cover and artificial insemination is nonsensical. One doesn't cost more than the other. I've done both. I've seen live cover. I've seen and participated in artificial insemination. The reason why the standard breed is the artificial insemination, the main reason is it's safer. It's better for the mare. A 1,500-pound stallion mounting a 1,200-pound mare is dangerous. A lot of problems can happen. It's safer to do artificial insemination. The bottom line is the cost of breeding are only important if you're breeding. The thoroughbreds had two foals born in 2019. My information is one in 2020. Two foals, as opposed to 100 foals, and on up. It's not even a thiving a fair fight. I don't understand for the life of me how this isn't understood, but I understand that a breeding program as the standard breds have been doing for years, but for the last five, six years, the program has increased. You can look at the notes. The thoroughbred foals have decreased, 36 in 2013, down to 8 in 2018, 2 in 2019. The standard bred foals, 36 in 2014, 49, 51, 96, 99, and so far this year, maybe well over 100. That's a breeding program that's encouraging, and in fact, it's bringing in reinvestment, keeping open space viable, and keeping people working. Again, I think we talked about small increments. I'll just say that it's a really disservice to the Commonwealth and the residents to be splitting the thoroughbred, standard bred breeding allocation, 65, 35. It really is, and I'll end with that. Attorney Savage, do you want to make any comments on behalf of the thoroughbred industry? I do. Thank you, Mr. Sheridan. Again, as we approach this category, you know, we have to do it in mind that we've already given the standard breads 56% of the racehorse development fund. They currently now get 65, 35 of the breeding money. That was never a product of any analysis. That was byproduct or, as I call it, collateral damage of the fact that we previously don't constrain to just set one number across the board. And I think now this is our first opportunity to actually develop a rationale for it. But there's absolutely no question, and I wouldn't disagree with Mr. Goldberg at all, that by giving the standard breads the bulk of the money, it has immensely advantaged their breeding program and has devastated the thoroughbred breeding program. Back in 2013, each industry had about 40 folds. Then the money started flowing to the standard breads as a byproduct split, and you can follow the numbers that Mr. Goldberg just pointed out. It absolutely did exactly what he said. It became overwhelmingly a standard bred breeding program heavily supported by the Race Horse Development Fund. And the changing of the split didn't just devastate the thoroughbred folding program, but there are 38 mass bred thoroughbreds that are racing now that were bred in Massachusetts with the expectation that those breeders and those farms and those stallions would benefit from the program the Department of Agriculture set up, that allocates awards to those horses. And those owners in Massachusetts of those 38 horses are not getting what they were bargained for because of the change over the years. The thoroughbred breeders need the bulk of this money. The standard bred breeders don't actually need anything for breeding. The first thing the standard breads have that the thoroughbreds don't have is access to the purse money in the 80% category that we just discussed. And in 2019, standard bred mass breads got 2.8 million from that source. In other words, the standard bred breeding program is amply supported and incentivized by the 80% purse budget. The thoroughbreds got zero money from that source because there was no in-state racing. Mr. O'Toole testified last week or spoke last week in front of the Gaming Commission about one of the things they're doing in Plain Ridge that relates to this, which is they're favoring mass bred horses in the races down there. And I'm not being critical about that. I'm simply pointing out that the general purse fund is being used intentionally by the standard breads who enhance mass breads. I think opening day was July 13th and there were five races on the card at Plain Ridge two days ago where it was non-mass bred, non-winners of a race, running against mass breads who had won a race. And the mass breads won three of five races. The deliberate directing of money from the 80% purse fund is working for the breeding program of the standard bred. And so they already get more of an allocation from that revenue stream than is at stake in this bucket. And so if the goal is to get us back to where we were in 2013, the thoroughbreds need more of the breeding money. We've got the cost issue that Mr. Goldberg disputes, but we wrote it out in detail. We've got the issue of it takes longer for a thoroughbred to get to the racetrack and money to be recouped. The frequency with which the different breeds can run, the standard breads could run more frequently. So there's barriers to entry on the thoroughbred side that even if all of the things were equal would favor giving more money to the thoroughbreds. But really the most critical point I think is going back to our fiduciary obligation and our duty under the statute to focus on the benefit to the commonwealth. And for every dollar that this committee provides to support thoroughbred breeding program, 87 cents goes back to Massachusetts. Every dollar that you spend on the standard bred program, 54 cents comes back to Massachusetts. So the thoroughbred, we pay out stallion awards, bonus awards, which are exclusively for Massachusetts people. The standard breads pay owners. The thoroughbred people are in Massachusetts. The standard bred people, that's it. And I think it's impossible to justify on a public policy or fiduciary basis choosing to give a healthy breeding program that only returns 54 cents on the dollar in opposition to a needy desperate breeding program that returns 87 cents on the dollar. And the standard breads know this because this is the one question in the executive summaries that they didn't answer. They just blew by it. But it's critical, I think, to our obligation to public funds, to going back to the gaming commission, going back to the governor, going back to the treasurer and saying, like, we spent the dollar where the dollar came back. And so the one thing that Mr. Goldberg tries to do, I think, to justify the economic development piece, and I don't disagree with him as to all the collateral industries that are involved, but they point in their executive summary, and I guess it's not Mr. Goldberg, that they've got the larger number of brood mayors. I think it's 141 registered. And we can't quite figure out where that number is from, but it's not actually particularly material because the point, if you read the document, sounds like this is 141 horses living on farms in Massachusetts, and there's a whole battalion of Massachusetts people working on supporting those mayors. And that's just not how it works. And so I just want to walk through to the committee has a common understanding that wasn't shared by the standard breads. The standard red mayor can come into the Commonwealth pregnant on November 30th and register. The deadline is December 1st. The mayor can remain here and drop the full, typically February, and go back to where they're from. So that's 10 weeks. That's not a whole year. Now, we don't have the data on how many are shipping in, how many are here. That wasn't shared with us by the standard breads, but we can't leave unanswered the implication that there's 141 horses here for a whole year generating a lot of jobs because that's just not the truth. And so it just there's no way that argument that there's 141 here for part of a year can outweigh the undeniable fact that if you spend a dollar on us, you get 87 cents back for the Commonwealth. And if you spend a dollar on standard breads, you let 46 cents go to Maine or New Hampshire or someone else. So I think it's important and we're asking with all due respect. I mean, please, let's reverse the policy that's gotten us into this position. Let's protect the money coming back to the Commonwealth. And with adequate resources, the thoroughbred breeding program can thrive. It doesn't need a racetrack in Massachusetts. We can race anywhere in the country if we've got that adequate resources to incentivize people to breed, which because of the collateral damage of the way the split eroded has has not been available to us. So we'd ask for a 65-35 in our favor, particularly in the light of they've already got 56% of the whole fund. Mr. Chairman, do I get my short rebuttal? Short rebuttal, yes. Thank you. Just not true. Attorney Savage says that their breeding program has been destroyed by the Resource Development Fund. In 2013, there were 36 thoroughbred foals. In 2014 and 15, when the thoroughbred industry was getting 75% of the Resource Development Fund. Let's remember that. For the first two years, they got 75% of the Resource Development Fund. When they got 75%, they got this giant influx of money. Their foals dropped to 22 in 2014 and then to nine in 2015. That thoroughbred breeding program didn't stop because of the Resource Development Fund changing over to the standard breads. That's just absolute, just not true. They're not true by the numbers. They went from 36 in 2013 to 22 to nine to 10 when they were getting virtually all the money, 75%. It then talks about the fact that the standard breads can use the purse money for their breeders program. So can the thoroughbreds, folks. It's in Chapter 128, Section 2, Subsection G. They have the same availability to request funds from the licensee from their purse account to put towards their mass bred horses. So that argument does not hold. With their pain now, with 27, which is bragging about their pain, the stallion owners, they're paying these aged horses money. They're favoring the mass breads. The mass breads get bonuses. So if a mass bred wins a race, if Finger Lakes racetrack, if it's a mass bred, it gets another $5,000. That's the program that they're doing. The standard breads are doing, yes, we're trying to encourage mass breads as well with the aged horse population. We haven't yet decided to pay bonuses, stallion bonuses or breeders awards. But there is, and the race, the different race condition, the condition sheets, as Mr. Savage talked about, yes, some races favor mass breads. So the older horses are now winners of a race lifetime get in, mass breads now winners of one. Absolutely. I lobbied that for years when I had mass breads and they were older horses. This is exactly what the thoroughbreds are doing. The thoroughbreds can do the same thing. The breeding program is not designed by the agriculture department. It's designed by thoroughbred breeders themselves or the standard breeders ourselves. And I think it's very, very important to bear that in mind. It's the reason why you encourage two and three year olds is to encourage breeding. And the reason why the breeding program for the thoroughbreds has died because they don't have those races and haven't had them. Their program is based on these breeders awards and stakes races for just mass breads. And if they had a two and, I suggest that they had a two and three year old sire steaks program like the standard breads do, that would encourage people to spend the three years and four months. There's a lot of misinformation. The resident man program for standard breads is the thoroughbreds have the same program. It says you can because in order to encourage breeding, there's no stallions. It's hard to breed with stallions. The stallions that stand in Massachusetts, the stallion, the two stallions that stand were not good race horses. The stallions that you can go pay money for and breed to are all grade one stakes winners. So it behooves you to breed outside and get a better stallion. The fact that this resident map program, the horses don't fall in February. That's a bunch of baloney. If you're lucky your horse falls in February. Most fall in April, May, June, some in July. I mean, it's an 11 month period. So it's the same for thoroughbreds as well. It's no different. The only difference is we're breeding, they're not. That's the difference. They don't get that a racetrack. It doesn't take any longer. There were plenty of two year old races. So that would be a racetrack in the country. They were attracted to two year old races, usually probably started around July, August, April, May. Just two year old thoroughbred races, this two year old standard races. The top races in the world are three year old races, typically for both breeds, right? The Kentucky Derby. Only three year olds getting that race. Why is that? Most popular horse race in the world, the Kentucky Derby. Only three year olds. This is the reason why you encourage two and three year olds to race. And the standard bred breeding program has done that. It does that. And that's why it's successful. The thoroughbred program has not done that. They don't have a breeding program. They have a program to award older horses money. That's not encouraging anyone to breed their mares back in Massachusetts. There is absolutely no, no, no good rationale for giving extra money to the thoroughbred breeding program, which I suggest is a misnomer. I would suggest a move, a tick upward, that the standard bred breeding program is absolutely deservedly of more than 65% of what's been allocated previously. And this is an important step. There are, there are brood mare owners all over the state that have the, it's a three year, four month approximately process. The breed of horse, they get that baby to the races. There are standard bred horses now in full mares. The cut to funding now would be drastic to them. There's not, there's none of that on the thoroughbred side. The only people collecting money on the thoroughbred side are owners of aged race horses. Thank you. Brief repuddle. Attorney Savage, yes. There's no question that they, those standard breads have gone from 36 to 99 under the race horse development fund. So giving one breeder the other money matters and they've proven it. So if you give us money, it will matter. And we're the ones in extremists. The bulls or thoroughbreds drop from 26 to 10 when the race horse development funds started to cut the money in more than half. It dropped by two thirds. A couple of things. There's just no question that the standard bred race horses get to the track quicker there. More two-year-olds run. They have a whole snakes program for two-year-olds. Thoroughbreds can do that. We do, we are running three-year-olds. We had four three-year-old races last year. And the most important or second most important point is Mr. Goldberg correctly quotes chapter 128 section 2 saying that you can spend money from your purse account. We don't have a purse account. Suffolk is out of business. We can't spend any of that 80 percent money the way you guys spent 2.8 million of it last year to help mass breads. So it's just- I don't think we spent 2.8 million dollars out of the that's not correct information. It's your reporting. You said that last year 4.5 million total went to mass breads. That's in your submission. If I back out the 1.7s from the breeding program, you've got 2.8 left. 2.8 million dollars earned by mass breads in the rest of the country last year. That's where that number comes from. No money was taken from the purse account in the standard breads put towards the stakes program, the breeding program. So you say that's not what your document says but that's fine. And then finally to the most important number and we're back to it is like a dollar to a thoroughbred breeding support program, 87 cents back to the commonwealth. A dollar to the standard breads 54 cents. You didn't even answer the question on the questionnaire. The standard breads didn't even bother because they know it's a killer. Thank you both. I'd ask the other committee members if they have any comments or questions or either of the industries at this time. I think it's more of a comment, Mr. Chair. Many of the breeders have come before the gaming commission at different times to explain their programs and whatnot. And the question continually asked of the thoroughbred is why is it there any breeding? I mean, I think those numbers are clear that the new breeding has virtually stopped, which means older horses are getting paid. And I think the answer to the commission has been there's no place to race and it's too big a chance to take. It's too much of an expense without knowing there's a place to race. So I do believe that's a much bigger factor in the breeding than the split has been. Frankly, I think it's the inability to race in Massachusetts that has really stopped folks from breeding and the law did get changed so that they could pay older horses, which is a way to keep some farms going. I do believe that, but I do think it is a breeding program and I do think it's important that the thoroughbreds are just not breeding virtually at all at this time. And so the question there, Commissioner Cameron, is like, so your gut is that's about the racetrack and my readers tell me it's not my gut at all. It's testimony before the commission and ask direct questions about why there is no current breeding going on or very little. And that's the rationale we've been given. I'm not, I don't have a gut on this one. I'm trying to decipher good information. Yeah, that was not the rationale that I heard articulated in the people who testified in front of us. And I obviously have to defer you as to people who testified long ago in front of you. Well, it wasn't long ago. It's pretty much every year. And you know, I just think that's a factor here as opposed to the split numbers because years ago, when there was full-time racing, they didn't have a resource development fund to take monies from and the breeding was much more successful. And I do think that had a lot to do with a place to race. We're in common ground there. I think that it's not an either or there's no question about that. Absolutely. If there was a racing facility, that would be an additional impetus, but the split has hurt us. And I'm wondering if there are some incentives that could be put in place by the thoroughbred breeders so that in fact, they would be incentivized to breed and then have those two year olds to go ahead and race. Thank you, Attorney Katana. I'm a little slow with the mute button here. So I'm hearing from the thoroughbreds that they'd be interested in a 6535 split. Mr. Goldberg, did I miss a specific split number for you that you're suggesting? No, you didn't miss it at all. I think I'll say the same thing as I said on the purses. I think I could ask for 100% with all good conscience based on the numbers, based on the metrics that we're charged to look at. But again, I would say an 85 to 90% split favoring the standard breads would be very reasonable in light of the fact that there's almost no breeding for the thoroughbreds and a good program for the standard breads that encourages investment and open space in Massachusetts. So Commissioner Cameron, back to your point, I think it's a really good point that the breed should consider various incentive programs and it may be grants and it may be other things, but without the resources, we can't do that. At getting half the money the standard breads get, we're barely making the purses to cover the 35 or 38 races a year of older horses. So if we were sitting here today and we kind of are sitting here today for the first time analyzing this category, I assume we'd be starting at well presumptively it's 50-50. Now, what factors might move it one way or another? And Mr. Goldberg's factors are, you know, which is robust, we're breeding a lot, there's lots of foals. And then, you know, our factors are, you know, the money stays in the commonwealth and we need the money to jumpstart where we've been hurt in the past. And that those things, you know, maybe that ultimately ends us up back at 50-50 or a little bit in favor, which I've proposed of the thoroughbreds, but that's kind of how I analyze the... Attorney Katonik, did you have any further comment? Yeah, I guess just one more quick follow-up question to Commissioner Cameron's comment, which I think is very well taken about sort of incentive programs that could, you know, help with breeding of thoroughbreds in Massachusetts. Has there been any thought about what those programs could look like if you had the resources? Yeah, we've had some discussions internally about a direct grant program, for example, where you pay someone literally to breed a mass breed. And then they wouldn't have to take the chance that, well, I might breed it and it can't run. And then, you know, and to sort of, because we're in the place we're in, kind of jumpstart that. And two things to be candid, it's not just the money, but we're unclear about the statutory authority to do that. But it was never worth kind of hashing out with the commission because we know we can't fund it anyway. But that kind of the primary thing that we're thinking of is along the lines of a direct grant program. Okay. Thank you. And that can take a couple forms. You can make grants to farms or you can make grants for births and the nuances and, you know, all hashed out. But that's where we'd like to get, if we can get the resources. Okay. But I guess the resources you do have, which are significant, Mr. Savage, frankly, I mean, compared to when before there was a resource development fund, don't forget it's not just the percentages, but before the pandemic, significantly more money was coming into the fund because of the opening of new casinos. So I guess I'm just there. There's so little breeding going on. This is a breeding program. I'm just, I guess I'm, I have a concern that this wasn't rather than just paying the money to older horses, which frankly doesn't encourage new breeding, why some kind of you say you're waiting for more money to do that. I just, there was a significant amount of money before and it has not been used to really incentivize breeding, which is what this program is about. So the thing that incentivizes standard bred breeding is the ability to win purses and they run their 35 races at the point range. We believe that the thing that would incentivize breeding, thoroughbreds, was the ability to win purses plus the bonus awards. So we, we had the same structured system, but we only had enough money to fund the purses at the reduced level because we're only getting half the money that the standard breads get. The incentive is not as great as it is for the standard breads because we have half the money and it's played out exactly like that. The standard breads have very aggressively bred and chased the money. So to say a million four is a lot of money, you know, relative to what? Well, can I just correct one thing, Mr. Chairman? You're not getting half of the money that the standard breads get. It's been 60-40 for the last two years. Now that it's 65 as of November, 2019 we got 61%. So it's 60, basically it's been 60-40. So that's, that's, it's not half the money. And, you know, in 2013, before the Resource Development Fund, the thoroughbreds had 36 foals registered before any Resource Development Fund money. Now that they're getting money, it's dropped to, to one and two. So I think Commissioner Cameron is spot on that the extra money has not helped the breeding. Well, the math is the math, obviously, the, the foals you can count them. I mean, there's no disputing what you're saying, Peter, but it's like, that doesn't mean that what I'm saying is not accurate. And plus, I really keep going back to the touchstone of like, you, the standard breads got about a million seven and 950,000 other came back to the Commonwealth. We got a million four and 1.1 came back to the Commonwealth. It's hard for me as a, as a public official, I don't know if we took oaths for these jobs or what, but to walk away from that fact, that what, what benefits the Commonwealth and its follow the money. So racing in Massachusetts is what benefits Massachusetts. Okay. Attracting outside investment is huge. One of the best things you can do for a breeding program and talk to the people in Pennsylvania, talk to the people in New York is to achieve the goal here is to grab these people. There are lots of breeders around the country and move the breeders into your state. And that's what we've done. The breeders program has been set up. It's been, it's been run by extremely competent folks in Massachusetts, not only to increase the number of Massachusetts residents for getting money and raising horses, but also attracting outside investment. That's key. It's not a bad thing. That's a great thing. That's what you want to do. You want people from Delaware, from New York, from Maryland, from Maine, from Iowa. We have, we have people from Iowa bringing marriage to Massachusetts, people from Florida, bringing marriage to Massachusetts. That was never done in 2013 folks. That wasn't done. We had years back in the days when there were three horse fields, two horse fields, one horse fields. Now they're full, they're full fields and it's a very competitive program. And it's because the program has been run properly and it's been a huge benefit to Massachusetts in attracting outside investment and also rewarding the local people who own farms, the veterinarians, the feedstores, the gas stations, the farriers, everybody. It's been, it's been very, it's been run very well and we ought to apply the metrics and put the money where it's working. The 25% of the mass breads in the standard bread industry are owned by Massachusetts residents. Listen, General Electric came from Connecticut to Boston. Is that a bad thing? These people aren't coming from someplace to here. They're staying in Maine. No, no, they're not. Lindy Farms of Connecticut bought a 300-acre farm in Massachusetts, okay, invested millions, tens of millions of dollars to develop a farm in Massachusetts for that purpose. So people are coming and staying in Massachusetts. I beg to differ. All right. With that, I had just some questions for both industries with respect to the breeding programs. And the first question really is directed to both industries and hopefully you can provide some response if you feel that there's a need to defer to your representative members who'll be maybe on the call. I'd invite them to speak in terms of any information that you may not have. But the first thing is, I just want to know in terms of delving into this and looking at the figures and the figures that have been presented, especially with respect to the allocations in terms of the distributions of the RHDF funds to mass breeders. And so I know that Chapter 128, Section 2G and 2J, both require of the standard breads and the thoroughbreds. Well, there's a reference in there that says that their programs can be audited to ensure compliance with this section as often as the state auditor deems necessary. So I did a little research and found that according to the state auditor's website, the last published audits for each industry was for the calendar year ending in 2014. And those audits were published sometime in April and June of 2016. So I guess my question for both industries, and I apologize for making this a long-winded question, but has either industry voluntarily audited their breeding programs? Or do they have an internal audit? Or are there audits that could be shared with this committee just so we can see how these numbers actually flesh out based on the compliance with the breeding programs? And I guess I'd ask Ms. Attorney Savage to first respond. And then we'll hear from Attorney Goldberg. Yeah. So first, I was under the impression that we've been audited recently with that, but I'll set that aside because I'm not 100% certain I'm right about that. But so we have an independent accountant that does our records and traces the money. And I don't know, and the guy who would know the answer just had to jump off this call. I don't know if that's called an audit, but it's a counting function that we're confident of. And we'd be glad to share the numbers and anybody who wants to kick the tires on where it went. I mean, it's not actually all that complicated because this white one, Mr. Cameron said, you know, it's a million four and you just start to list the purses that it went to pay. And then the stallion awards and then the breeder awards and then there's the by statute, there's 8% for administrative. So 92% of the money goes out the door every year to these purse awards. But I'll make a note to get that to the members of the committee. You know, after this meeting's over for whatever consideration in the future. Okay. Thank you. Attorney Goldberg. I'm unmuted. Yeah, I think that the actual audits when the state requested the audits are done. I know a request from the committee recently, the the mess, the standard breeders did submit their annual, all the annual records from 2019 that shows where every dollar was spent. And it shows and they do quarterly counting audits. I mean, they have to spend 92% on purses. Up to 8% can go towards operating costs. And that's done every year. I don't I think the state audits it when the state wants to, but they keep they keep good records. And I think they provided them for 2019. And I think they're happy to provide them 20 years that that you would request for sure. And do you know, are those submitted to the to the gaming commission? I guess I defer to Dr. Lightpound. So sorry, no, they're not submitted to the gaming commission. They by statute the state auditor's office does it. And I know there hasn't been a state auditor audit done since the resource development fund. Money has gone out. It started in 2015. The money going out. And I did notify the state auditor's office. At some point, I don't know if it was in 2016 or 17, you know, the two organizations were receiving quite a bit more money through this resource development fund than they had in the past. So, Mr. Chairman, my folks are texting me and the accountant that we use is a guy named Bill Robbins. And he indicates that we're audited every three years. And then our last audit was 2017. Thank you. Thank you. I do have a question. I guess for you, Mr. Goldberg, and again, I guess I would defer to your representative member in case there's any detail that you may not be able to provide. And when I kind of sifted through all the numbers that were submitted based on the breeder expenses, I note that on the listing, it just, it shows the earnings, you know, the 2019 owners by state earnings by race. And showing that basically a million, $1,254 was granted to mass owners. And the whole allocation for the breeding program to the standard breads as of last year was about 1.691,909. So I just wanted to kind of just get information just in terms of when we're looking at these figures, you know, how is that pretty much decided in terms of those distributions? Because if you look at it, then you'd say, well, one could interpret and say, well, only 59% of the resource development funds were allocated to mass breeders. So I just kind of want to get some clarification as to the thought process in terms of those numbers. So. Yeah, a mass breeder does not have to live in Massachusetts, right? So if I'm a Florida resident, and I own a mayor and I say, geez, mass is having a great program. I ship my mayor up to Massachusetts. I get a stall at a farm. I said, you take care of my mayor and you can you breed my mayor for me. So the breeding season, February, March, April. So you bring your mayor in, it gets bred in February, March, April, May of that year in a mass business farm. And if you're lucky, the, the, the, the fall, the mayor becomes in full. She conceives and the mayor then has to register by the end of November as a prude mayor. And then that full then if the horses conceives in April, if you're lucky sometime in March, she has the, she has the fall. And then that fall wherever it lives, it has to come back when it starts to race, it's a mass bred, right? The fall is a mass bred. The owner might be in Florida, but the fall is a mass bred. So when the, when the, every mass bred race, standard bred mass bred races in Massachusetts, that plain ridge. So they have races for two year olds every year for three year olds, separate races for Phillies and for Phillies, separate races for, for Colts and Geldings, and separate races for Trotters and Pacers of each, of each age and sex. So that's what happens. You know, these horses are in Massachusetts, but they may be owned by someone in Florida. That's a good thing. That's getting General Electric to move to Boston. That's getting investment dollars that normally stay in Florida, Iowa, New York, Delaware, New Jersey, Connecticut, and moving these people's horses, not necessarily the people. And there've been a lot of people that have moved. That's more of the trainers who are actually training the horses. There are quite a few trainers who have moved their tax, so to speak, to Massachusetts. But in the ownership, I mean, I can own a, I can own a Florida bred horse, no problem. They'd love it. Florida would love it. If everyone in Massachusetts started buying a Florida, sent in their mares to Florida to become Florida breads, that's the goal of a good program. And then just to follow up with that, so then obviously then the horses that are listed on the reports, then those are all on those owners by state. Those are all horses that are registered through the mass breeding program. Oh, a hundred percent of them. They have to be to race in those races. Absolutely. They're all mass breads. They all have to be registered on time, pay these, the fees to the Commonwealth, and have to do their due diligence in Massachusetts. Thank you. And looping back, Mr. Chairman, since I'm getting this information in real time, the audit that was done in 2017 did not touch on the race horse development fund. So it's a different portion of their program. Let's just see. So Attorney Savage, I just kind of wanted, and then again, I guess I would say just with respect to this question, if it's a, there's some detail that you feel you need to refer to your representative member, then please invite them to help respond. But I just, just as a general question, I know that in terms of the race horse development funds that were allocated in 2019, was roughly $1,127,637, and essentially $687,850 of that was dispersed through Suffolk Downs. So I just want to confirm so then the balance of that then would have been distributed at tracks or through tracks outside of the Commonwealth. Yeah, hopefully Matt Clark is on and we'll know, you know, what's fixed and what's not there. Matt, are you available to speak? I think I found the magic rage one near myself. Thank you so much for the opportunity to talk. Good afternoon, everybody, Mr. Chairman, members of the committee. I just wanted to try and clear up a couple of misconceptions about the difference in the breeding of standard breeds and thoroughbreds. And, you know, I've been involved in thoroughbred breeding for 45 years on three continents and I have great experience of both life cover and artificial insemination. The mass breeders have several of our members who have farmed in the Commonwealth. But over the past few years have been following both thoroughbred and standard bred horses. As Mr. Goldberg correctly pointed out, you can bring a pregnant standard bred mare into the Commonwealth anytime prior to December the first of the year preceding following. And most of the foals that have been born at our members' farms have indeed fold in January and February. There is a great incentive to get your foals on the ground as early as possible because obviously a fold born in January or February has a distinct advantage over a fold born in May or June. I'm talking to Arlene Brown and to Jennifer Tynkowitz. The average size of a standard bred mare, standard bred mare, of their farms is only between six and 10 weeks. They come in, they fold. Once the fold has been inspected by the AR, they leave and they go back to their home state where they will be artificially inseminated. Now, artificial insemination is obviously a purely clinical procedure. The Jockey Club who run thoroughbred racing in North America mandate life cover and you have stallions like Justify, like American Faro that are worth literally millions of dollars, fifty, sixty million dollars, covering thoroughbred breed mares that are worth eight, ten, twelve, twenty million dollars. The assertion that it is dangerous to the mare is really, you know, that's stretching the point. I mean, obviously it's a procedure carried out by very experienced people who've been doing this for generations and know exactly what they're doing. The difference really, and I agree again with Mr. Goldberg, yes, it's nice to send your mare out of Massachusetts to breed to a better quality of stallion. So, if I wanted to send the mare to Kentucky, I've got a case of transportation to Kentucky, probably a thousand dollars both ways, the mare is going to have to stay at the stallion farm for probably the minimum of a month, maybe even two months depending on whether she takes on the first cover or not. You've got significantly higher veterinary expenses with life cover as opposed to artificial insemination. And of course the beauty of artificial insemination is you literally just pick up the phone and order the semen and it will arrive as either pulled semen or frozen semen in the mail within two or three days and your mare doesn't have to go anywhere. You don't have to transport her and your veterinarian performs the clinical procedure of artificial insemination. So there is a vast, vast difference. Mr. Clark? That's it. Yes, I'm sorry. I just, I guess my question, thank you for that information. I just, my question was more directed towards the purse allocations and the thought process related to you know, $687,000 out of the $1.127 million was allocated towards Suffolk Downs and I just wanted some confirmation that the balance had been distributed through other tracks. Yes, yes. The last breeders last year conducted 12 races at Suffolk Downs and then a further 15 races at Finger Lakes and the purses for all of those 27 races were taken from their share of the breeders funding. I'd also quickly like to touch on the fact that Timmy should Cameron talked about incentivizing breeding and there is a bill that is currently before the legislature, which if passed would give the NTBA the right to do that and in a very, very creative way. So it has been well thought out. It's a well-conceived plan. The only problem is if the legislature passed that bill in the near future, which we're hopeful they will, it will kind of be a move point if you remove the funding that will enable the breeders to fulfill the intentions of that legislation. Okay. Thank you, Mr. Clark. Thank you so much. Mr. Chairman, if all on Mr. Clark's answer, there's a small remaining balance Suffolk plus Finger Lakes plus the bonus program. So it's like the stallion awards, the breeder awards and whatnot, but that all accounts for the total figure that you asked about. Okay. All right. Thank you. Do any of the committee members have any further questions or comments with respect to the breeding programs? Seeing none then at this time, I guess I would open it up for discussion in terms of whether or not any of the committee members feel that there is a need to reevaluate and or readjust the allocation of the breeding programs. Well, Mr. Chairman, I think it's obvious based on the metrics that the standard breeding program is just that. It's a well-run, well-organized, productive breeding program. Without rehashing everything, I would suggest that there needs to be a reallocation of the breeding money in order to be fair and properly do our job for the residents of the Commonwealth. I suggested an 85 to 90 percent location towards the end of breads. Commissioner Cameron, I'll defer to you if you feel that that's too much. I'm willing to discuss that obviously. I think it's at some point we have to go with the metrics though and really put the money where it's working. So obviously, I'm in the opposite place and I think it's time to save thoroughbred breeding and continue to have the money come the Massachusetts. Maybe there's a place in between those two places called 50-50 where we treat each industry equally. I think ought to be a starting point and then Ober's got his arguments to run the other direction and we've got ours to enhance the direction. That's kind of where we are. Mr. Chair, I think it was interesting to hear from Mr. Clark that they are looking at other ways to incentivize. As we've said with every category, we're really looking at the difference between 18 and 19 to make these decisions. When we look at those numbers, it is a breeding program and that's for whatever reasons. We don't have to try to figure out exactly the reasons but there has not been an awful lot of breeding going on on the thoroughbred side where there has been on the standard bred side. So personally, I do think the numbers I'm persuaded by numbers and by listening to both sides that increasing and I'm again cautious and we've always been cautious not to make swings too big but I am persuaded that maybe a 5% increase would be warranted toward the standard bred breeding program. If I could mildly dissent on the analysis, I get why we have and I agree with Mr. Goldberg looked at 2018 versus 2019 for the 80% purse category because we've always analyzed that in detail. We've never analyzed this category in detail so I don't think that we're in the same position analytically and I think it's inappropriate frankly. You can still get to your 70% number but I don't think that's the way to get to it. I would disagree that we may not have separated it out but we've certainly discussed breeding programs and coming to our overall numbers in the past. Every single year we've talked about health and welfare breeding as well as purses even though we didn't separate it out we did thoroughly discuss those issues. Well and I guess my view would be but we never came to a consensus that oh actually it just turns out by coincidence and a bred should get twice as much as of everything in every category because that wasn't within our purview so we absolutely thoroughly discussed and did our job but I don't think we've ever made a decision like we're about to make and that that is relevant I think to whether precedent matters if you've never made an actual decision before. Attorney Katana. Can I just interrupt I'm sorry because I don't know this is. No no no no this is Mr. Chairman this is not a public hearing. Correct. Any more representative. Attorney Katana. I'm trying to save people's livelihoods and farms here and and we put criteria together to argue and I don't think we're looking at it but. I know I'm going to object Mr. Chairman to what is this not a public hearing the Thurberts have a representative who's more than able and they've already had extended comments by by folks about unrelated subjects. I think we have to mute these new people who are not on the committee now so we're not here till midnight. Okay yes. I've got 67 people that I would love to argue. I have Chip Campbell and Nancy Longabardi that would love to tell you about the standard bit of breeding program and go on and on and on I don't think that's okay. Thank you. Attorney Katana. Yeah thank you and thank you for the reminder on the time too because I appreciate the thorough analysis that we're walking through but I do have another commitment at five so I'm going to have to run for you again just in terms of timing. Okay. I think in terms of sort of separating out this bucket I do hear the argument that you know more funds in this category would be helpful to the Thurberts. I think I would be more persuaded if there was more of a firm sort of program or proposal in place or if there was a shift to use the existing funds that the Thurberts are receiving towards you know the programs that are being contemplated and discussed that would be you know available if additional funds were made available. Thank you. Is there at this time I would ask or entertain a motion is there a motion that's being proposed by any of the committee members? Mr. Chairman I'll make a motion based on a Commissioner Kammer's comments. I had moved that we adjust or adjust the split based on the for the breeding portion for the 16 percent breeders portion of the resource development fund to 70 percent for the standard breads and 30 percent for the Thurberts. I'll second that motion. Any further discussion seeing none then I will take a roll call vote. Attorney Katanak. I. Commissioner Cameron. I. Attorney Savage. No. Attorney Goldberg. He's muted. Yes. And Fitzgerald. I. Thank you. So moving on to the next category which is our health and welfare benefits and in the interest of time because obviously we've spent a great deal of time and I hate the fact that right now that we unfortunately we are going to be cut with some limited time for the discussion of of this category. So I guess in following our prior procedure in terms of allowing for any brief statements I would call upon Mr. or excuse me Attorney Savage on behalf of the Thurberts to make some brief statements with respect to the health and welfare benefit programs allocation and your executive summary and then I would turn the floor to attorney Goldberg and then allow the committee members to make any questions. Thank you Mr. Chairman. So so we now stand at the point where we've given the standard breads sixty seven two percent of the entire resource development fund. Again I think for these categories that we haven't ever considered individually before that fifty fifty ought to be the starting point and I think you ought to come out slightly favoring thoroughbreds at sixty forty right now again the sixty five thirty five saying that the standard bread people are twice as valuable as thoroughbred people is is not based on anything other than accidental collateral damage from the prior way to I mean the reality in terms of benefits to the thoroughbreds are just to maintain where we were around this reduced split number is a budget of three hundred and sixty dollars and it's been cut to two seventy five thirty five percent and if it comes in it it looks like the casino money is going to be at a twenty five percent level the coming year then we're looking at going from a budget of three hundred and sixty thousand to seventy five thousand and it's had real concrete impact on people and aid our life insurance benefit because of the reduction of the split last year and we're really grappling with like what public policy reason would there be to cut off a life insurance benefit for mostly massachusetts people right now to increase a pension benefit for most other state people and in other words the need here is is immediate and if we don't get a modest increase for a year and then we think this should just stabilize at fifty fifty it's really going to have immediate detrimental human impact and that's not true with the standard bread program because they're making a contribution long-term contributions over time to a pension program and the standard bread people in that industry couldn't access that benefit now they wanted to when we've got people on the thoroughbred side that are depending on this in the midst of a pandemic and a hiatus in in in relationship in racing and and and they and they highlight the people a lot of people signed up for their organization but they they've yet to translate that into actual benefit to the commonwealth so our proposal is to address the immediate desperate human need which is something that's going to be around for six months or whatever with a 60 40 tilt in our direction and then stabilize this thing at 50 50 because there's you know decent people in in both industries this is this one really not be one where people are stabbing each other in the back for a nickel because we're all horsemen and uh you know we're asking i mean i asked peter straight out can you give us a break on this one we got a real problem thank you attorney salvage attorney goldberg yeah so you know the problem here is we're talking about i think poor planning on the side of the thoroughbreds they put in place whenever it was put in place a defined benefit plan a plan that's based on current revenues to pay out people's benefits that's great if your IBM maybe or if you're amazon or maybe that's a bad example but if i work for a company with a defined benefit plan they go out of business my benefits stop and i know that i have to plan for that and i have obligation as an individual to plan for my future not to depend on my company company might be a supplement to where i retire but people over 65 i don't know how many people are over 65 they're getting money but there's medicare for those people the life insurance they're providing is small dollars so i'm not so sure there's that much critical need but it's just a it was poor planning when when HHA and he got some funds from the resource development fund it did the right thing it sat down spent a couple of years doing its research doing its due diligence and figuring out what the best way was to take care of the members in a responsible and most importantly a sustainable fashion and also how to attract outside investment because what we have to remember is again the gaming statue that this that wouldn't place the resource development fund in the horse racing committee not designed to take care of Suffolk Downs or Plain Ridge Park or or their members that wasn't the idea it was to take care of the Commonwealth residents and if we're going to implement gaming in Massachusetts how do we best effectuate a positive ROI to the Commonwealth and not a drain so HHA and a has done that they went out again they came up with a way not only to help people but to incentivize people to come to massachusetts so and i attached the rsp the retirement savings plan and they they looked at the health insurance and they said we can't beat mass health we can't beat Medicare for what it costs to provide those benefits people are better off getting mass health but what we can do is we can put we can put in place a responsible retirement program that attracts outside investment and that's what it does if you look at the the pages that i've attached that indicate who's responsible you you get actually points whether you're a driver or a trainer based on the number of days you spend in the Commonwealth of massachusetts either racing or driving or training horses so it's a great program does it they'll now they're also paying for eyewear and eye care fuel they can't afford it at the track they're also giving out caretaker awards the grooms who are usually the lowest paid people that track uh they paid out quite a bit of money last year for the caretaker awards and there's also a hardship component there were a couple of deaths last year that left some people in hard times and the HHA and they threw their health and welfare welfare made payments to them as well so i don't begrudge this the thoroughbreds anything it's certainly people that are deserving of what they get and not tell them not to give them the money but it's the product of poor planning and i think the same way with the breeding someone's got to tell these folks get with the program and design a better plan for you know if going forward you're going to race in massachusetts and i hope they have a race track in massachusetts but when they open it up and they start racing you should research and it's find a plan that does the best things for your constituents as well as the Commonwealth that's what we're here for so we've talked about health and welfare before and i think standard beds again just as in their breeding they've done such an alice tisbert has gone out of her way spending hundreds probably hundreds and hundreds and hundreds maybe thousands of hours not only researching this this retirement savings plan but implementing it and keeping it running keeping it funded and keeping people educated and helping to attract the outside investment so you know it's unfortunate with the covid with them all the funds being being reduced from these from the casinos to cut funding to the health and welfare now for the standards would be tragic just just as tragic no more no less tragic i don't think then you know people lose their health insurance on the thoroughbred side i'm pretty sure they qualify for mass health or or medicare if they're over 65 so i i don't think there's um any reason to uh split this any differently than it's been split in the past so if i could briefly respond mr chairman first of all the uh the notion of bad planning is both inaccurate and offensive we've been we've been providing benefits to our members for 40 years and we've never been in this situation you guys the standard bed set up a pension fund two years ago so if we want to talk about planning we planned 40 years ago to take care of our people and we've taken care of them every year there is absolutely no justification for the standard breads last year getting 438 thousand dollars and the thoroughbred 288 like what in what way are the standard bread people better than people that they get 150 000 more dollars for health and welfare that to me is completely indefensible no it's it's defensible because the people that are getting not being interrupted but if that's what you need to do peter go right ahead well joe you asked a question i'll wait till you're done before i i made a statement that it's indefensible um so we're sitting here with a disparity of 150 000 dollars not based on any analysis of health and welfare but based on how the overall split was done in the past and i don't think that takes into account the needs of any of the human beings involved here thank you thank you uh attorney katanak do you have any comments or questions for either the representatives based on what they've just discussed no i just i think i would um hirken back to the reason why we chose to separate out the buckets in the first place um which was really to focus intentionally on each specific bucket but this bucket in particular because of the human impact that to me um was very persuasive in making the decision to shift from allocating the entire pot overall versus looking at the items individually thank you commissioner came on i was going to make that same exact point it is the reason we're here today with three different uh decisions to be made was the concern about health and welfare which i share i have to tell you i am persuaded by letter after letter or email from folks that are hurting and and again this one goes back to the ability not to be able to race so these folks are are hurting and i and i think it's real and i am you know much more persuaded on this side on this particular bucket to um to give uh more of a percentage to the thoroughbred folks and i hear what everyone's saying that and i have no no qualms with anything that's being said my point that i forget what your question joe was quite honestly but the money that's going out to the the yes the standard has never had the ability to take care of their own people it wasn't a matter they didn't want to they never had the funds they they raced on on fumes for many many many years when the time came that they had the ability many many hours in fact a couple of years were spent figuring out what the best way again the most responsible way and most sustainable way to take care of people and also to encourage the investment in massachusetts these people that are getting paid you know they're people that used to work i understand that but it's not they're not people who are working now in the industry in massachusetts and now those are the people who are getting benefits from their rsp on the standard red side that's all thank you peter if i could inquire no one has been paid out of the rsp yet right people are vested they have a right to get paid if they want but i don't know the people have been actually i don't know the answer to that it's a it's a retirement program you get vested and then you can use your money at a certain age and with certain penalties and yeah i i believe from the the data you guys produce which is very helpful and thorough that no one's actually been paid um attorney goldberg i just had just a couple of brief just actually a brief brief question just in terms of what was submitted in terms the from the executive summary and that was just some of the expenses that were related um or addressed um within category uh so in the summary that was presented there were some fees for um out of this particular allocation there were fees for the harness horsemen's international dues uh third party liability insurance program there was an expenses on behalf of h a h h a and e and the amount of 20 000 dollars in an annual audit that was for three thousand dollars and i just wondered if you could just elaborate in terms of those expenses and how they're related to um health and welfare benefits and again i would qualify that if you do need to defer to one of your representative members you can for this question Peter you're muted who keeps muting me mr chairman so if i only had the power so in conclusion yes no and i know we're short on time yeah the harness horsemen's international dues the organization they have to they get a lot of help from they have to be a member of that they get help with a lot of their where they handle their the accounts where they handle the horseman it's just a membership the third party liability insurance is critical every member three hundred thirty members of h h a and e members get that so if i'm a horse if i'm an owner and i join the h h a and e and my horse goes out and runs somebody over god forbid and they sue me i have insurance to cover that with liability insurance um so the i the outside vision care um again that's the that's 25 members went and got eye care that couldn't afford it and got that same thing with the hardship assistance program three members had terrible events in their life that were they were given some funds um the member care take rewards same thing the annual audit was just an audit they do internally to make sure the money's being spent properly thank you uh are there any further comments or questions from the committee members at this time i'd call upon the committee members uh to um discuss whether or not they feel there is a need for an adjustment to the allocation of the health and welfare benefits program you know i i i do i in the thoroughbred executive summary um attorney well no it wasn't attorney savage the the thoroughbred breeders requested a 60 40 split favoring the thoroughbreds uh at this time in 50 50 in the future um i think that might be reasonable so is there a motion i'd entertain a motion to be made i i move that the the split be adjusted to 60 40 in favor of thoroughbreds um on the health and welfare um category and just state as an aside with the understanding that will hopefully aim to 50 50 here on after but that's not the motion is there a second you're not going to second it peter you can do it am i mr golberg you thought that was reasonable correct i will second the motion if that's what you're waiting for as commissioner cameron i can see it in your eyes even from even from miles away thank you mr golberg all right so there's a the motion has now been made is there any further discussion i was just i was just giving giving one of the female members of you know maybe a chance to second the motion that's all i'm trying to be nice and we were we were asking you to step up because you you had just said it was reasonable i i i appreciate that i don't think you have to worry about the two women on this committee frankly i'm not worried about anybody on this committee worried about myself all right so the motion having been made i'm going to now take a roll call vote uh attorney katana i commissioner cameron i attorney savage yes attorney golberg yes and Fitzgerald i so thank you thank you all so that concludes item five on the agenda uh in terms of our next item on the agenda which is discussion of next steps schedule a future meeting dates and industry deadlines i just guess i would call upon the members at this time to say now that we've made these recommendations to be submitted to the gaming commission in terms of further discussions related to the resource development fund do we want to at this time try and set forth some appropriate meeting dates mr chair i'm sorry to interject if i may i just wanted to point out a point of procedure in the statute at section 60 paragraph b it says the committee shall submit distribution recommendations to the clerks of the senate and the house of representatives yeah not less than 30 days before submitting the recommendations to the commission for final approval so we need to send them over there first ours and with everyone's assent the staff of the commission would be happy to do that perhaps along with a link to this meeting in case any context or texture would be helpful to anyone who may review it and then subject to the rest of your conversation and whether there'll be any meeting dates coming up we can then submit it over to the commission for review from there thank you attorney i guess the next steps would then be that this obviously our recommendation would be submitted to the do we want to at this time entertain any discussion on scheduling any meeting dates i guess my instinct mr chair is that given the crazy year we're in that we not set a date right now for anything we may we may need to come back and see each other sooner than we would in the ordinary course um and and i i think maybe you know communicating through todd or whatever if there's things that come up and then toward the later part of the year get the process underway for next year okay i would just suggest that it's always good to have a date we can change it we can cancel it we can move it up we can move it back at least if we have a date you know there's a lot of people on this screen here that have busy schedules i think i think taking a date that we can that the committee can agree on now at least as a placeholder is probably a good idea in light of what's happened in the past so are we talking in the fall are we thinking october or something along those lines evenly fall even october november you know i don't feel i don't feel strongly about this so if we want to if there's a consensus date let's grab it yeah that's fine i may be more considering uh whether we stated uh later than that in terms of after the the racing season and you know potentially so but it can just be you know a sort of an agenda setting meeting where we say okay here's what's going on and let's pick a meeting date december or january i don't think i don't think it needs to be a substantive meeting date so to speak just about how about december 16th just as a catch-up so unfortunately or i guess fortunately um for me that's not gonna work um i will be most likely out on parental leave starting late october through january um so my my windows if you will are kind of early october or waiting until january i'll make sure that we have an alternate and whoever it is is in relation with briefed and up to speed um but if we could set a meeting maybe prior to that like mid october um that would be my preference yeah priors tough in terms of having any reasonable numbers what when might you be back when might you be back in january um early january is the plan so you want to do january 13th sure but but we could also set an october date just to set the future date it could even be a date setting you know just so i mean whatever that mr chair suggests i just you know january is not going to be a substantive we're going to come in to set dates yeah we run the risk of you know ending up so maybe an october date just to assess what's going on and pick and pick dates you know for getting records together getting numbers together getting information and before and that that way if we do an october and we set a date for early february we then all have the two industries have time to gather data and get our ducts in a row so to speak okay all right so we're looking at october then quick it could be a 10-minute meeting you know it can be a i don't think we're capable of a 10-minute meeting but i am not opposed to an october date okay so and attorney kentenak what works in october for you at this time i would say probably the first or second week we're looking at roughly say october 7th sure attorney savage sure i'll be i'll be due for my next haircut then but yeah okay oh i i i get it much before then you know i i don't go near barbers so it's like seventh works for me i'm looking at my calendar that looks fine for me as well okay that would be fine for me as well so then okay so we'll we'll address october 7th at this time to tentatively schedule it for then for our next meeting and then i think at that meeting what we'll do is we'll we'll have a discussion in terms of setting any future dates at that time and talking about agenda items all right is there any further business or any other business that the committee members wish to address at this time okay seeing none then um uh do i have a or to entertain a motion to adjourn so moved second hey i was ready to go so do we want to retake the motion or that's all right all right so having uh motion to adjourn then attorney katana i uh commissioner cameron i attorney savage yes attorney golberg yes and Fitzgerald's i so thank you all to the committee members thank you to the gaming commission staff i really appreciate all of your hard work and efforts towards this uh and thank you to all of the uh individuals and representatives who've submitted letters who worked on submitting those executive summaries i really appreciate all of the hard work that you've um you've put in so thank you all thank you thank you everybody see you next time you next time thank you thank you everybody stay safe