03/27/2013 12:50PM

Bob Pandolfo: Cal Expo among one-mile tracks experiencing a surge

Cal Expo Photo
Handle on Cal Expo's harness racing in Sacramento is up 27 percent, averaging about $850,000 a card.

When it comes to American harness tracks, the focus has always been on the Northeast tracks. But last year we saw Balmoral's business improve and show that Chicago harness racing has some legs. This year the Meadowlands has improved its business sharply over last year. But, wait a minute, there's another one-mile track that's showing signs of a recovery, and it's all the way out west.

It may be hard to believe, but Cal Expo, the only harness track in California, is now right behind Balmoral in handle. Yes, Cal Expo is handling more on some nights than Yonkers Raceway. What's going on here?  Cal Expo is a track located in Sacramento, not exactly the harness capital of the world. It’s a track that has almost shut its doors for good on several occasions.

Conducting a harness track in California is bucking the odds. Here in the Northeast there are racetracks in New York, New Jersey, Delaware, and Pennsylvania, providing a large pool of horses to draw cards. But in Sacramento, horsemen have to travel a long way to race for total daily purses that average less than $50,000 a night.

Last fall, a group took over the lease on the Cal Expo fair grounds. I wondered why anyone would bother. To find out, I called and spoke to Cal Expo's general manager, Chris Schick. Schick, who is originally from Kingston, N.Y, is no stranger to Cal Expo and has worked there in some capacity or another since 1995. He has owned horses, and he's a lifelong harness racing fan who loves to handicap.  Schick and his business associate Ben Kenney were able to partner with the Watch and Wager LLC, a gaming company from the United Kingdom.

Schick explained their interest.

"The economic situation in Great Britain, like most of Europe, is not good. There are austerity measures in place. Gaming companies over there are looking for other opportunities to expand their business."

Watch and Wager is not a huge company like Betfair. But it is looking at a possible advanced wagering business (ADW) and online horse racing presence in this country.  The firm is also watching any potential progress in online sports gambling, if it is ever legalized here.

Betfair is trying to get exchange wagering going in the United States. Exchange wagering gives bettors different wagering options, such as betting a horse at a fixed price set by another bettor, or betting against a horse to win. Exchange wagering hasn't been able to get off the ground in the United States yet, but Betfair is hopeful that it will eventually pass. Twinspires, which is owned by Churchill Downs, has also shown interest in exchange wagering in California.  If exchange wagering does make it in California, Cal Expo would benefit because it would be the host for all harness racing exchange wagers in the state. This means that every time a bettor in California made a bet on any harness track signal through the exchange, Cal Expo would get a piece of the action.

So that's where the money came from. But what about the handle? Schick and his team took over in November, so this turn around came quickly. Cal Expo's handle is up 27 percent from the same time last year, an extraordinary accomplishment. Handle is averaging right around $850,000 a night.

"We made quite a few changes,” said Schick. “Early in the meet, Watch and Wager in partnership with the California Harness Horseman's Association offered a cash incentive program to attract new horses. The incentive was, if a horse had never raced at Cal Expo, they would get a check for $750 after their first start. That helped get bigger fields. We also created a solid late closer program named for well-known harness veterans. We had late closing series named after Jim Dennis, Jim Grundy, Joe O'Brien, and we've still got the Lloyd Arnold and Stan Bergstein series to come.

"But, to be honest," Schick said, "getting all the races on TVG has really helped."

Cal Expo signed a five-year deal to have its races broadcast live on the Television Games Network, the most popular daily horse racing network. I was curious if Schick felt that TVG offered him a good deal. I say that because other tracks, such as Parx (formerly Philadelphia Park) have vanished from TVG's air time, reportedly because they didn't want to share revenues with TVG.

"I would have to say that our deal with TVG is fair. When someone watches our races on TVG, they aren't always betting through TVG. Some are making bets through a different ADW, which means that TVG makes no profit on that bet. We understand that. On the other side, having our races on TVG does have a potential down side. We make a much bigger profit on bets made at simulcast outlets in California. Now some of those bettors may be sitting at home watching the races, which means they're not betting in state; a lower mark up for us. So we have to weigh both sides. "

But the bottom line is that Schick believes the TVG exposure has helped the handle significantly. Since Cal Expo's on the West Coast, by the time its races are being shown, which is later in the evening here on the East Coast, there isn't as much competition.

"We do have some things going for us. We're in a nice part of town," Schick said. "People can walk around the area, there are good restaurants. We have a big barn area with over a thousand stalls and we don't charge any stall rent. We also have reasonably mild weather, so it's a nice place for horsemen to race harness horses in the winter."

The current Cal Expo meet will run until May 25 this year. During the winter, the track had full fields, something that bettors like. But already some horsemen have started to leave to prepare for spring harness meets in the Midwest. Chris Schick knows that shorter fields will make it tougher to maintain the handle. But he admits that it's hard to be disappointed in the results.

"Sure we'd like to make a lot of money," Schick said. "And at $850,000 a night in handle, we're right on the borderline in terms of what we need to do to show a profit. But with handle up 27 percent we’re happy with the way things have gone since we took over."

Personally, I think they deserve a lot of credit. The fact that Cal Expo has been handling more than Yonkers (albeit by carding more races each night) on some nights is incredible when you look at the huge advantage that Yonkers has with its slot-infused purses, which dwarf Cal Expo's purse structure. Yonkers has big purses, top horses, and famous harness drivers.  Cal Expo doesn't.  

This is further proof that A) Bettors aren't always focused on high-quality race horses, they want good betting races and they will bet lower class races if the races are competitive. B) Harness bettors are much more interested in betting the one-mile tracks than the half-mile and five- eighth tracks.

As someone who has been covering this sport for 38 years, I have to say that I simply can't understand why these half-mile and five-eighth tracks just stand by and watch their business go out the window. We talk about the success that Balmoral has had the past year or so, but there's another side to harness racing in Chicago. Maywood Park, a half-mile track which races Thursday and Friday nights when Balmoral is closed, has not flourished in the same market. Balmoral has gained market share, Maywood Park has lost it.

The picture is clear.  Half-mile track harness racing is in big trouble. And if you look at the five- eighth tracks, they were never that popular. Even with big purses, tracks in Delaware and Pennsylvania are unable to generate the handle that the three one-mile tracks can.

Is this because harness fans love one-mile tracks and hate half-mile tracks? Not really. When done right, half-mile track racing can still be popular. But these tracks are not making the changes they have to make to be competitive. Most bettors don't want to bet tracks that are speed biased, post position biased, and where there is an endless stream of boring races and low payoffs. I have said it before, and I'm going to say it again. There is one way to save half-mile harness racing. They have to go back to slower bikes, preferably the original wooden sulky that was used when half-mile tracks were booming. With the faster steel bikes being used now the fractions and final halves are too fast for closers to catch up. Consequently, leavers win almost every race and there are too many short-priced winners.

"When I watch some of the races on half-mile tracks," Schick said, "in a lot of the races no one pulls first over until past the five-eighths. There's no movement like they're used to be."

That's because it’s so hard to go first over around a turn into the wicked third quarter split that the pacesetter is pouring on. The one-mile tracks have the long straightaway which helps the horses on the outside pick up momentum and get into the action. The only way to compensate for the extra turns is to slow the races down so the outer flow can develop. Slower bikes will correct the problem on the half-mile and five-eighth tracks. This is an easy and inexpensive fix. I really don't see how anything else could work. The problem is the speed and post position bias and that is what has to be addressed.

But, these tracks seem dead set on handing their business over to the three one-mile tracks: Balmoral, Cal Expo, and the Meadowlands. All three of these one-mile harness tracks have seen major increases in handle. They are the only harness tracks in this country that are on the upswing.

To find out more about Pandy’s handicapping theories check out his www.trotpicks.com or www.handicappingwinners.com websites, his free picks at handicapping.ustrotting.com/pandycapping.cfm or write to Bob Pandolfo, 3386 Creek Road, Northampton, PA 18067.