Jim Whelan is a realist and a dreamer. The PEI native is currently running for a Standardbred Canada director position in Ontario, hoping to bring about changes for the benefit of racing’s hardest-working individuals. “I’ve done well in the industry. The industry’s been really good to me and my family,” says the career horseman, now based in Troy, Ontario. “I’ve been up here for 40 years. I grew up in Atlantic Canada; the horsemen are my friends. They’re like family, and I can’t stand by and see them starve to death, literally, and not do something about it, when there’s no need of it.”
As president of the Ontario Harness Horse Association (OHHA), Whelan witnessed the rise of the Ontario Slots at Racetracks Program (SARP), which he helped negotiate.
“Back in the ‘90s, when we made the deal to share the revenue with the slots, we knew that slots coming into the tracks would cannibalize the pari-mutuel wagering, and that’s why we were able to negotiate the deal for 10% for purses and 10% for the tracks. 5% went to municipalities,” he tells Atlantic Post Calls. “The trouble was, the tracks were supposed to reinvest their 10% back into their core business of pari-mutuel wagering and racing. All they did was shut down all the backstretches, give themselves bigger salaries, and give themselves a bonus at Woodbine. It was a total abuse of the system.”
The Ontario SARP ended in 2012, hurting many horsepeople who had invested in farm properties and breeding stock. Whelan says that racing has required advocacy ever since the loosening of gaming regulations after Expo ’67. The federal Criminal Code was amended to allow the provinces to license and regulate their own gambling industries starting in 1970, which opened the door for widespread casino gaming. The pari-mutuel system, introduced in France in 1894, had been used for legal betting on Canadian horse races since 1910. With the protected status of horse racing and pari-mutuel wagering suddenly gone, the sport needed—and still needs—to find new ways to sustain itself.
Even at successful harness tracks today, Whelan says the true numbers are sobering. “There just isn’t enough money in the plan with pari-mutuel concessions to fund the racetrack as a business and pay purses. There just isn’t enough money to go around anymore.” As racing’s legal protections and gambling-dollar monopoly have been stripped away, racetrack operators have simultaneously faced a steep increase in the costs of doing business.
Small regional racing venues have been disproportionately impacted by these costs, even with the added revenue which some have gained through Horseplayer Interactive (HPI) account wagering availability. Whelan says looking at handle alone is “confusing”, because it doesn’t subtract the fees which apply to bets placed through Atlantic Canadians’ HPI accounts. The money netted by each track is considerably less than the gross handle reported at the end of the card.
Whelan says that racetracks must be run as businesses, but Maritime tracks face significant financial barriers to gaining a foothold. When bettors bet using their HPI accounts, 5% of each wager on a Maritime track goes to Woodbine-owned HPI, with an additional 1% percent as an administration fee, and 3-4% percent for the simulcast signal. “You have to pay for the signal—nobody looks at that. Like if you’re taking Woodbine, it could be 3 to 4 to 8%. They charge different rates to different people; nobody knows what it actually is in Atlantic Canada. If you’re taking Gulfstream or Santa Anita, they charge more again—that’s the highest-priced signal out there.”
Technologically, there’s no reason for the expensive monopoly on ways to watch the races. “There’s Betfair and other ways of buying the signal,” explains Whelan. “Then Roberts [Communications] decoders—that’s an absolute crime. Years ago they decided to scramble their signal, and now you have to have decoders at every racetrack and betting outlet, like a teletheatre, and you’ve got to pay Roberts for these decoders. Meanwhile I can go on my phone, and watch races from all over the world through illegal betting systems.”
Even at Flamboro Downs, which he gives as an example, “Now you’re lucky if you get 3-4% percent of the bet sometimes, with the cost of the tote system and Roberts decoders. When you put your costs in, there’s nothing left to share; if [tracks] split it with the horsemen, there’s nothing left.”
Ontario aside, what would help Nova Scotian tracks cope with this troubling division and diversion of local wagers? Not pari-mutuel wagering as it currently exists, says the OHHA president: “As you know, in Nova Scotia, everything is continually going downhill, and only getting deeper in debt, so under the present system, there’s no future.” Government funding is helpful, yet it doesn’t improve antiquated legislation and track infrastructure: “They [the Nova Scotia Harness Racing Fund] get a million dollars a year—they give a little to the tracks and a little to the horsemen for purses, but [NS racing is] dwindling every year. The thing is, nobody really knows, with the bet, how many dollars they’re actually getting. HPI is taking the bulk of the money that’s bet in Atlantic Canada under the system that we have now.”
He believes that the most sustainable racetracks of today have diversified properties, such as “racing showplace” Gulfstream Park’s conversion of some parking areas to a retail complex beside the Florida Thoroughbred venue. That’s why Whelan and business partner Paul Micucci had a “multi-entertainment centre” in mind when they pitched their Celebration Gaming racino to the Nova Scotia government nearly a decade ago. It was to include live harness racing and casino gaming, but not be limited to these two uses.
Micucci was vice-president of Ontario Lottery and Gaming (OLG) slots at racetracks, development, and operations for nearly five years, overseeing the installation of slots at 18 Ontario tracks. He accepted a position with the Frank Stronach-founded Magna Entertainment in 2003. Magna owns Gulfstream Park, among other North American Thoroughbred and harness racetracks.
Whelan says the increasing urbanization of Nova Scotia would have helped racing flourish at the Celebration facility. “Absolutely. Because the plan was to have the gaming centre where the population was. They were talking about building a [football] stadium then, so we were going to incorporate a multi-entertainment centre. There would be something going on, seven days a week, [even] when there wasn’t racing.”
The then-provincial NDP government shut down the Celebration for reasons Whelan calls murky, even today. “The property wasn’t the issue,” he recalls. “It was like Newfoundland—[government] keep leading you on, and you think, ‘We’re just about there.’ And then something changed and you have to start all over again. There was no willingness to do it. Everybody seemed to be scared to make a decision. So nothing happened.”
As Halifax Council keeps circling the topic of a taxpayer-supported CFL stadium in Dartmouth, the provincial government’s rejection of Celebration Gaming’s self-supporting racino looks even more unfortunate. Whelan says he and his business partner never asked for government money in the project. “No—just a betting permit, to have gaming there. That’s all. We said we’d fund the whole thing.” The city was waiting on another football stadium proposal when Celebration made their pitch: “They were talking about building a new stadium down there, then, and that never happened. We met with the city when Peter [Kelly] was the mayor at the time.”
It was at the next level of discussions that the Celebration team encountered roadblocks. “We couldn’t get the province to listen to anything. We started out with [Progressive Conservative Michael] Baker as minister of finance. He seemed pretty keen, and then he got cancer,” remembers Whelan. “So then you start with another minister, and then the government changed three times: You get a Liberal, Conservative, and NDP through that spell, and then you’re starting all over again with [each] of them. Nova Scotia’s gone backwards in the last 20 years.”
The Dartmouth racino location seemed to cause ambivalence within the Nova Scotia Harness Racing Industry Association, although the NSHRIA did provide Celebration Gaming with a letter of support. Whelan says that a prosperous racino in the provincial capital would have aided, not hurt, Nova Scotia’s three other pari-mutuel tracks. “The money you generated through gaming would go to the province, to help Inverness and North Sydney if they wanted to race their circuit in the summer,” he explains. “The money has to come from somewhere. Well, you’re limited as to what you can generate in North Sydney or Inverness, or Truro, for that matter. They’re in the wrong location—there’s no money and there’s no population there.”
Whelan says he and Micucci never met with Dave Wilson, the Sackville-Cobequid NDP MLA in charge of the gaming portfolio. “No. He wouldn’t. We met with the [former provincial leader of the NDP, Robert Chisholm], a nice enough guy. Sensible. Then [NDP Premier Darrell Dexter] didn’t do anything.” In March 2011, the Dexter government’s provincial gaming strategy explicitly rejected any racinos.
“It was just always, ‘We’re still looking into it.’ They drug it on and drug it on. It was never official; you’d hear something in the press, where somebody would say it was this or that,” the career horseman notes with frustration. “Government says ‘Why are we putting money into an industry like this? They don’t want to help themselves, basically.’ That’s why we took the approach in Nova Scotia that we would finance it and build it. Just give us the gaming license and you can tax it until you have a profit. We would have gotten our money back, and it was a business plan.”
Great Canadian Gaming-owned Casino Nova Scotia currently offers casino games and a Truro Raceway-operated OTB room in Halifax. The company has not expressed interest in a Halifax-area racino, although Whelan says it once had the opportunity: “If you wanted to build a racetrack in the Halifax area, Great Canadian Gaming had the first right of refusal to build one, which they’re never going to do. So the contract with them expired, I think, five or six years ago.”
Population trends and the high costs of simulcasting have hurt Nova Scotian racing, notes Whelan, who used to travel from PEI to drive at Sackville Downs and recorded his first lifetime driving win at Exhibition Park Raceway in Saint John, NB. “People don’t want to travel anymore,” he observes. “They’re not going to drive to Truro from Halifax for a race. […] But if you built a brand new, efficient, state of the art facility in the Halifax area, and there’s lots of land there that’s owned provincially and by the city and also by the federal government that’s available…” His voice trails off; the interviewer’s mind races with possibilities of what could have been.
Whelan praises the influence of PEI horse owners and their families in getting positive responses to racing-related concerns. He’s also liking what he’s seen from PEI’s Progressive Conservative Premier Dennis King. Electing supporters of harness racing helps strengthen the industry and related economy: “It’s like when Mitch Murphy was the minister of finance, and the grandstand in Charlottetown’s roof blew off and they were going, ‘Oh, it [repair] will never happen.’ Well, Mitch took the bull by the horns and he wouldn’t back off. He got the support of his caucus and you know, they kept pushing until they got it done.”
He adds that politicians don’t necessarily need to be racehorse owners or horseplayers to appreciate how much harness racing contributes to the economy and tax base. Whelan says it was a positive sign when Nova Scotia Deputy Premier/Finance Minister Karen Casey attended Red Shores Charlottetown for Atlantic Breeders Crown weekend. He also named PEI Deputy Premier/Finance Minister Darlene Compton as “a strong supporter of the racing industry” who understands its cultural and economic value.
With the number of Standardbred Canada members in serious decline (“less than 6,000, actually, and 2740 of them are in Ontario,” he says), Whelan is running for SC director again to focus on the struggle of harness racing’s less prosperous participants. He still thinks Halifax could use a multi-purpose racino, but has another strategy he thinks can easily turn around the sport’s fortunes in Nova Scotia, New Brunswick, and Newfoundland and Labrador. Look for a discussion in the next Atlantic Post Calls.
As for the proposed $94-million Atlantic Schooners football stadium, he’s unconvinced it’s worth anything near that figure. “How many CFL games are they going to have there? So what do you do with it the rest of the time? It’s a big dinosaur, a white elephant.” And Whelan, as always, would rather stick to horses.