The Boondoggle that is the NTRA Safety Alliance

Tweet If you're a follower or occasional reader of this blog, you probably know that I have been an outspoken critic of the results of the NTRA Safety and Integrity Alliance. I had been wondering where this initiative, which commenced in October 2008, was headed after Churchill Downs pulled out of the NTRA earlier in 2010, and since I hadn't heard of any tracks achieving accreditation in recent months. Well, I found out through reading the Report of the Independent Monitor released yesterday by the Washington DC law firm Akin Gump et al.

While 55 tracks aligned to show support for the Alliance back in 2008, only 25 have actually ponied up and undergone the review of the Code of Standards established. Only five (5) went through the process in 2010, which had to be a very humbling statistic for the NTRA, and none since July. The report cites "economic challenges," wherein "tracks are struggling to remain financially viable." To the credit of the Alliance, a sliding scale for fees was implemented to entice the smaller or "B" level tracks to comply. However, none of these smaller tracks (other than Finger Lakes) appears to have jumed on that train.

The proof will be in the pudding in 2011, as the initial 19-20 tracks will be up for re-accreditation as the 2-year window expires (and we know Churchill won't be one of them).

The reasons for the program not catching on or increasing in breadth isn't earth shattering:

1) The Program Has No Teeth. - There is really no motivation for tracks to participate. In essence their are no prohibitive factors for not participating. Even the independent monitor states the obvious in its recommendations to "Create Incentives for Racetracks to become Accredited." One suggested option by the monitor included "engaging state regulatory authorities to consider requiring accreditation as a condition of licensure." Good luck with that.

2) The Program is Bleeding Cash. - One look at the NTRA's 2009 Annual Report shows that it lost over $500M (or $25K/track audited) in both 2009 and 2008 (all in start-up costs, no revenue was earned per the Annual Report). Again the monitor highlighted the budget issues in its report stating there is only one full-time employee and all of the rest of the monitoring/testing is performed by outsourced industry consultants. To have a fully rigorous process, you just can't get away charging the small fees that are being charged, and now a sliding scale can only lead to lower revenues. The program is clearly bleeding.

3) Safety > Integrity. - The entire program was a knee-jerk reaction (with no dedicated funding) to the Eight Belles incident and has had almost a 90% emphasis on safety. One read of the report shows that wagering integrity, which only was introduced into the Standards Code in 2010 (See Section III of the report), attained only two paragraphs in the entire 12-page report. And you're trying to endear yourself to the horseplayer how? The monitor calls for more education of fans to the Alliance's work, recommending that "if fans understand what Alliance accreditation means, they may only want to wager on Alliance facilities." Ok, Tommy, can I get some of what you're smoking?

I'll speculate that possibly 50% of the 2009 accredited tracks sign up for the next go-round, depending on the arm-twisting that surely will occur. Has it helped safety, yes, but at what cost? Most business plans and decisions are made with a cost-benefit analysis. Are there any tangible and measurable results from the process? The "independent" report has statistics, but it provides the economic excuses for non-participation showing declines in handle, purses and race days. How about how this program has increased safety, such as reduced on-track injuries or lowered workers compensation claims experience. Just give us something that shows results. Until that happens, folks like me will continue to question the overall program.