Breaking News ... Texas Racing Commission assails HISA's hegemony ... signal will be cut July 1

Breaking News ... The lone star moment appears to have arrived early ... well before July 1. They've been saying it, after all ... Amy Cook, the Executive Director of the Texas Racing Commission (TXRC) did. The Chairman of that state government entity, Judge Robert C. Pate, did too. Over this past month, they both took the position that when it came to carrying out the Texas Racing Act, they could not do their jobs alongside the Horseracing Integrity and Safety Authority (HISA) because the latter would preempt the power of the former. That was unacceptable, and even though both the TXRC and HISA agree that Thoroughbred racing is a great sport; they differ when it comes to "authority."

Cook and Judge Pate welcomed the opportunity to talk to HISA's small cadre of specialists that include what many consider to be a "perfect fit" for the organization that will clean-up horse racing. CEO Lisa Lazarus and General Counsel John Roach finally accepted an invitation to visit last Wednesday, months after it was issued by Cook. After the TXRC adjourned their June 8 Session, the real meeting took place afterwards, but clearly little was accomplished. Late this afternoon, Cook issued in a letter what she called an Approval of Pari-Mutuel Simulcast Wagering Import and Export Requests Policy Statement, which was addressed to "All Occupational and Business Licensees of the Texas Racing Commission." At the heart of that group ... are the horsemen. 

Last Friday afternoon at Lone Star Park, a place that is in the middle of its Thoroughbred season, local trainers and owners gathered for a meeting at the track to hear representatives from HISA discuss the coming "registration" and that July 1 deadline. According to several unnamed sources, the tenor was contentious and angry about the lack of communication, and grievances were heard in a public forum. One trainer said, "I spoke with my lawyer for over an hour after the meeting, and they cannot make me register, I won't do it." He went on to say, "The idea that HISA can come on my property, and seize anything they want to, is not going to happen ... I know my rights." Others that attended the meeting were not pleased with the way in which HISA has communicated their ideas, and quickly "rolled out a program that seems too much like a patchwork." Many Texans that hold state licenses want more time.

Amy Cook was listening, and her Monday afternoon letter to them speaks to that. "We are denying HISA jurisdiction by disapproving signal export for all "covered horse races," she said via a phone call. "Our goal is the prevention of regulatory chaos, and the cost will be the loss of revenue in that export signal ... but you cannot put a price on certainty." She agrees that more time is needed to sort out a myriad of issues, which are important to this industry in the Lone Star State. Since that export signal will only be denied for "covered horse races" that meet HISA's definition (Thoroughbred), it does not affect the entire broadcast.

As she said, "It only denies a portion of the wagering handle to reap the benefit of Texans knowing we will supervise and regulate races in 2022." When it comes to pari-mutuel betting, only in-state wagering will be allowed. What Cook calls, "Texans supporting Texans." Betting on Texas Thoroughbred races outside the state will not be possible. In other words, Lone Star Park will still run on the race dates approved by the TXRC (through the end of July). Wagering signals will be imported, or exported within, but will not cross outside the state line, thus invoking HISA's jurisdiction.

Cook's letter begins with ... "Effective immediately, all pending requests for approval for the import and export of pari-mutuel simulcast signals will be considered and approved on a case-by-case basis, in writing, signed by the Executive Director. This policy change allows for the determination of whether the export or import signal invokes the jurisdiction of the Horseracing Integrity and Safety Authority created by the Horseracing Integrity and Safety Act of 2020 (“HISA”), which is effective on July 1, 2022." 

And it ends with ... "Since the Texas Racing Commission regulates all aspects of Texas horse racing, including, in particular, pari-mutuel and simulcast wagering in Texas, the application of federal law pursuant to HISA in any aspect of horse racing regulation for a particular race or meet will necessarily preclude the Texas Racing Commission from full compliance with the Texas Racing Act and will, therefore, necessitate that no such affected race shall be allowed to conduct on-site pari-mutuel wagering or provide simulcast export signal. Any such request will, of necessity, be denied by the Texas Racing Commission."

Her mission is to fulfill the obligations to the state of Texas who hired her last fall. Cook feels that there is just too many "gray areas," ill-defined based on how they were originally constructed by HISA. She still has not received a clear answer about "mixed meet" (different breeds running) jurisdiction questions, which is incredibly frustrating. "Last week, we advised HISA that the Gillespie County Fair, which holds a mixed meet, does not export its signal," she explained. "They were included in a bill I received in May, and they got an email saying that they had to register ... to me, it just seems that HISA doesn't know who should register, and which races they should actually have jurisdiction over." Like the horsemen at Lone Star last Friday, confusion appears rampant, and is muddled at best. As the Executive Director of the TXRC, Cook is the approving authority between the tracks and the horsemen when it comes to the signal agreement. She said it seemed unfair that a track or the horsemen should make this call. So ... she did. 

With regard to Cook's discussions with Lisa Lazarus, she said, "We told Lisa that there should be a delay in implementation for 18-24 months because it was so unclear what they will do on July 1st ... it is the best decision for my state, and even though I appreciated her coming to visit, Texans deserve clarity from their regulatory agency." As concerns mount over loss of livelihood, counterbalanced by the threat of federal oversight that will push costs next year beyond what tracks and horsemen can afford, the uncertainty is mounting ahead of the rapidly approaching HISA implementation date.

For now, Texas stands alone. Will other states follow their example, sacrificing Thoroughbred handle, in order to preserve regulatory uniformity at the state level? Today, the line in the sand was crossed by Amy Cook and the Texas Racing Commission. HISA's hegemony is on hold ...