Anthony MacDonald: Modernize, not abolish, licensing for fractional ownership

Modernize, not abolish, licensing for fractional ownership

March 1, 2020

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by Anthony MacDonald / TheStable.ca

NOTE: The Proposal for Implementation of a Fractional Ownership License created by TheStable.ca in July 2019 and referenced in this column can be read in its entirety here.

I have watched the back and forth with Mr. Pearce and Mr. Gurfein about licensing and I respectfully disagree with both gentlemen (full story here).

No one spends more on licensing in North America than thestable.ca and I was the one that lobbied to have the threshold changed in Ontario from 5 per cent to 1 one per cent.

Why would anyone lobby to pay more money? This has nothing to do with what’s easy, and everything to do with what’s right (and at the same time, reasonable).

Unfortunately, all of us are under the thumb of a government in one way or another. People in Pennsylvania may understand this more now as Ontarians should also from their recent past.

When a bureaucrat decides that money earmarked for the horse racing industry could be spent better elsewhere, there is a thin line of defense between that transaction taking place and not.

This is an argument that is usually won or lost in the court of public opinion.
Our defense is always in our numbers:

• The economic impact which the government’s investment in horse racing has on our communities.

• The spinoff attributed to that investment.

• How big our industry actually is, and how that information is compiled.

• An accurate and measurable level of participation.

If we don’t track all our numbers accurately, they will be seen as guessing, and the data will be unusable in the eyes of the government.

When Ontario was under attack, our industry put forth conflicting numbers and the government used their own.

It was the Pearl Harbor of racing and it was one of the scariest times of my life. There will always be people that get angry because horse racing receives public funding in one form or another, but as long as we can show and prove its usefulness in society — at least from an economic stance — we will always have an argument to make.

Pennsylvania has done a great job taking the fight to the governor immediately and hopefully averting his feeble attempt at robbing Peter to pay Paul. This argument could only be stronger though with an accurate depiction of ownership.

You should not take this lightly as this won’t be the last time they come for the money and we should be ready, because once it’s gone, it’s gone for good.

I will also be the first to agree that it needs to be more economical to be an active owner.

From a fractional ownership perspective, New York is one of the most expensive states in which to race. We raced a horse that had 26 fractional owners in New York last year.

Everyone was excited about the year ahead with their young horse. It was a win-win for the industry and our group… until it came time to get licensed.

It was going cost our clients over $5,000 collectively to be licensed for that one horse in New York.

Not surprisingly, the ownership group quickly shrank and it became clear that this was a state we would love to race in, but we simply couldn’t.

I agree there needs to be a collaborative overhaul of the licensing practices of horse racing in general. That is why we created a fractional ownership licensing proposal in 2019. We floated it to all jurisdictions and had lots of interest in pushing the model from key stake holders in our industry.

But like a bill in Congress, it’s collecting dust.

The purpose of the proposal was to raise awareness of the current complications and barriers that exist with horse ownership licensing; specifically for those entering the industry as fractional owners, and to propose improvements to help the industry flourish.

Our experience has demonstrated that the current licensing model is not sustainable for fractional owners; it is a major roadblock in our ability to deliver a good experience for our existing clients and hinders our ability to attract new ones.

We are NOT asking to alter or reduce the fee for any existing horse owner license. We are respectfully proposing the implementation of an efficient, modern and proportionate licensing system for fractional ownership across all jurisdictions. We are asking for the implementation of a Fractional Ownership License.

Abolition is not the way forward.

Higher thresholds sure make my job easier, but again they won’t help the industry overall.

We need to understand what’s at stake, and work to ensure there are multiple avenues and affordable ways to participate in horse racing across the board.

I have spoken ad nauseum about what kind of role fractional ownership can play in helping this industry grow. To do that, we need to start understanding the barriers in front of us and start taking them down. Licensing is a major problem — on that point, I agree with Mr. Pearce and Mr. Gurfein.

How we address it will make all the difference in the world.

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