What does the future hold for Great Lakes Downs?

By Troy Ruel

Shane Spiess invested his future in the Michigan Thoroughbred industry nearly a decade ago when Great Lakes Downs opened in Western Michigan.

The veteran trainer bought an expansive ranch and moved his breeding and boarding operation across the state following the closure of Ladbroke DRC in Detroit.

“GLD has been good to us and I love this area,” said Spiess, who won the inaugural training championship at GLD in 1999. “I have put everything I have into this place. This is home now.”

For John Drumwright, his expense might be even more. Drumwright came to Michigan in 1940 — and has devoted the last 67 years to the state’s horse racing industry. It’s decades of time spent in a business he loves. “This is all I’ve ever done and all I know,” said Drumwright, 84. “You put a smile on your face and pray for the future, but I’m not sure what I’m going to do.”

As the midway point closes in on Great Lakes Down’s 100-date season, both trainers — along with the hundreds of other horsemen on the GLD grounds — face an uncertain future as the 74-year-old history of Michigan Thoroughbred racing could come to an end when the season concludes on Nov. 6.

Magna Entertainment Corp., which owns the meet license through MI Racing Inc., announced last January that this would be its final meet in Michigan unless there were “significant changes in the regulatory environment that restricts horse racing from competing at a level playing field with other forms of gaming and entertainment.”

The MEC release came early enough with a standing offer that lease agreements on the facility were possible, however, as self-imposed deadlines continue to pass, nothing has been done yet to save Michigan’s only Thoroughbred racing facility.

“It’s frustrating, and even depressing at times, but we’re doing everything we can for the future of Thoroughbred racing here in Michigan,” said Gary Tinkle, executive director of the Michigan Horsemen’s Benevolent and Protective Association. “It’s a tough sell, but I believe it’s vital to maintain dates in 2008.”

A rich traditionThoroughbred racing kicked off in 1933 with a 31-date meet at the Michigan State Fairgrounds in Detroit and has since grown into a $1.2 billion industry statewide.

The industry was riding an emotional high in 1998 with a record-setting combined wagering handle of over $145 million at DRC, but track owners carried out a threat that they would shut its doors if casinos were allowed to be built in downtown Detroit.DRC did just that on Nov. 8, 1998, ending a run of 48 years in the state’s major metropolitan area and leaving the Thoroughbred horsemen in limbo.

The horsemen found some relief when a group of private investors re-opened Muskegon Race Course — a former Standardbred track near the shores of Lake Michigan — and eventually sold the facility to Canadian billionaire Frank Stronach, who was in the process of adding strategic venues across the country to his growing stable of MEC facilities.

The move to Muskegon was thought to be temporary as MEC won the licensing rights to build Michigan Downs, a proposed multi-million dollar entertainment complex in metro Detroit. However, the legislative climate cooled across the state and those plans since have been placed on hold.

The primary reason for the pessimism was the 2004 passage of Proposal 1 — an anti-gambling measure primarily funded by the state’s casino interests. The vote added a law to the Michigan constitution requiring statewide and local voter approval before additional gambling opportunities were added, eliminating the opportunity to add slot machine-like video lottery terminals at the state’s seven pari-mutuel facilities.

Since then, the figures have been staggering as the tracks struggle to keep pace with other states.

The combined wagering handle at GLD dipped to $14 million last year — 90 percent off the final figures from Detroit — and numbers statewide are down an additional 12.4 percent already this year. The purse pool continues to be affected as well, as last year’s total was $6.1 million, half of the 1998 numbers. The first casualty came with the closure of Saginaw Harness Raceway to begin the 2005 season, while GLD appears to be next.

Magna Entertainment Corp. estimates its annual losses to average $1.8 million and stated prior to the current season that it “can not continue to subsidize horse racing in Michigan with no prospect of future profitability.”

“We’re aware this could be the last year,” said GLD general manager Amy MacNeil. “It’s business as usual. We’re striving to make this the best year ever.”

“In a sense, we’re lucky to have Magna’s support even for this one last year,” said five-time GLD track training champion Gerald Bennett. “But, it’s tough not to think about the future. Everyone, so far, is doing their part to make the races go.”

What lies ahead?

The news was devastating — albeit not surprising — to the Thoroughbred horsemen at Great Lakes Downs.

However, the decision could create a crippling ripple effect through the state’s entire agricultural community. Horse owners and trainers are already looking to sell off a majority of their stock — creating voids in filling fields and putting a pinch on the local economy.
According to numbers supplied by the track, GLD generates $3.7 million into West Michigan through its vendors, while the horsemen generate millions more through temporary housing, feed and other job-related expenses.

As the season nears the halfway point, the effects have been noticeable. Trainers already are lightening work loads and jockeys are looking to ride elsewhere.
“You’re starting to see people cutting back or selling off, that’s what I intend to do,” said Spiess. “It’s too expensive to keep them. The drought this year isn’t helping and the cost for feed and fuel has increased. It’s a vicious circle.”

Gerald Bennett, who led the field with 430 starts and over $1 million in earnings last season, is nowhere near the leaders in starts for 2007, while former champion jockey Mary Doser chose to return to Kentucky to be closer to her family farm.

The future of the industry is in jeopardy as horse breeders also are getting out of the game. Rick McCune, who has been breeding horses since 1980 in Michigan, has witnessed the decline firsthand. “The uncertainty is killing the sales and hurting the farms,” said McCune, the acting president of the MHBPA. “When I got into the business, there were 26 farms that do what I do. Today, there are only five in Michigan. There is no market for our animals.”

McCune said he bred just 12 mares last year, down 75 percent from past years. The auction prices for the annual yearling sale saw a decrease of 66 percent from a year ago — averaging just $2,700 a head.

“No one knows what’s going to happen with the track, so a lot of people are cutting their losses and getting out of the business,” added McCune. “They’re cutting back because they just can’t afford to keep the babies.”

If Great Lakes Downs does close its doors, many of the state’s horsemen will leave in search of greener pastures. However, their options remain limited. It’s tough to break into new racing circles, while getting granted stall applications late in the game will be difficult as well.

Many may not have the stock to compete against horses from Kentucky and the East coast. Some trainers and owners are expected to ship horses to established tracks in Illinois, Indiana, Iowa, Ohio, Louisiana and the fall meet at Fort Erie. Once they leave, it will be hard to draw them back. Meanwhile, others will choose to get out of the business altogether.

“It’s tough to say how many would get out of horse racing here in Michigan,” said Dr. Robert Gorham, the leading trainer at this year’s meet at the midway point. “The smart ones got out of it a long time ago.”

“When you get the horse racing business in your blood, it’s hard to get out,” added McCune, 60. “That being said, there’s absolutely no way I would start all over again. I am 60 years old now and it’s just too much work and a lot of time.”

Guarded optimism

Many of the trainers at Great Lakes Downs continue to go about their daily business and try not to think about the future. Whether it’s a 
case of denial or unbridled optimism is a reason for debate.

“It’s like we have our heads stuck in the sand,” said one horse owner. “We don’t want to believe this is happening to us.”
Unfortunately, deadlines are coming quickly on the status of the track. Race date applications must be on file with the Michigan Office of Racing Commissioner imminently.

“We’re all beginning to realize we have to do something soon,” added Gorham. “It’s beginning to get more and more pressing for the horsemen. At some point, we need to all stick together and come up with a solution for the future.”

There are ideas that could impact the track’s status. There’s controversial talk about the possibility of adding instant racing — video game-like machines that offer betting on taped races — while many believe a ballot proposal to add slot machines may not be too far out in the future — even as early as 2008. There’s a growing belief that Magna Entertainment Corp. wants to be around when that happens as they still hold the license for Michigan Downs.

Other possible proposals on running a shortened season or even move to a different Michigan racing facility don’t seem realistic to many horsemen. Purse revenue this year is already down nearly 10 percent, so the track would need to run a minimal amount of dates to make it cost-worthy for Michigan horsemen to remain. And the cost of transforming an existing Standardbred facility into a Thoroughbred track would be too much.

“There’s just too many loose ends out there,” said Tinkle. “We’re trying to do something, but we’re limited in what we can do. We’re willing to work with anyone willing to put a meet on, unfortunately, there’s not a lot of people able to do that.”

Many people believe that if Thoroughbred racing went on hiatus — even for a year — that it would be a crushing blow to the industry.
“Absolutely devastating,” added Tinkle. “We lost a lot of people when we went from Detroit to Muskegon and it would be magnified if we took a year off.”

In addition, the Michigan breeders fund — which helps supply nearly $2 million to the purse pool for state-bred stakes races — is in jeopardy if the track comes to a close. Horsemen groups have petitioned ORC Commissioner Christine White to place that money in escrow, but with the financial troubles within the state, all bets are off.

The Michigan Harness Horsemen’s Association, a group that has been at odds with the Thoroughbred track in the past, has also vocally supported the efforts to keep GLD open. Many people feel that without Thoroughbred racing within Michigan, simulcast signal opportunities, as well as wagering, will fall dramatically.

The key ultimately could fall at the hands of the state legislature.“We’re still wagering the way we did in 1933 — basically it’s win, place and show and that’s it,” said Tinkle. “It’s sad to say, but horse racing has a deep tradition in Michigan and it’s in serious, serious trouble.

“And, so far, nothing’s been done in Lansing to allow us to compete fairly for the gaming dollar.” Jim Griffin, a prominent state owner and breeder, said, “In order to salvage the industry, we’re going to need a minor miracle here. “We need some cooperation from the state to give us something to survive.”