06/22/2010 11:00PM

CHRB meeting not quite just business as usual


Mark the day. June 22, 2010. This was the day the scales fell once and for all from the eyes of California's horse racing community.

At least, that's how it felt in the Sunset Room of the Hollywood Park Turf Club shortly after high noon on Tuesday when Frank Stronach, the man who controls Santa Anita Park and Golden Gate Fields through his real estate investment company, MI Developments, began to articulate his vision of horse racing.

This was the real Frank Stronach, volume turned up, energy level at peak setting, combative, and determined to make the case he never thought he'd need to make, at least not in such a public setting.

If the commission, the large audience, and the media in attendance were expecting Stronach to step back from his evangelical belief in free enterprise as applied to the heavily regulated horse racing industry, they would be disappointed.

If they were waiting for Stronach to apologize for the turmoil and uncertainty generated in the operation of Santa Anita and Golden Gate as a result of the bankruptcy of their parent company, the Stronach-run Magna Entertainment Corp., it would be a long wait.

And if they held any glimmer of hope that Stronach would relent on his decision to terminate Santa Anita's traditional partnership with the Oak Tree Racing Association in presenting a nationally respected autumn meet, there was little reason to dream. It was the termination of the Oak Tree lease that prompted the California Horse Racing Board to call for Stronach's appearance.

Stronach came out of the box pitching a general philosophy with which no one could really argue.

"First of all you've got to have a concept: what would be the ideal conditions," he said. "That's always where you start out with a business. This would be an ideal structure and conditions. But then there are realities around you, like laws, and then rules and regulations. I fully realize that. I also said that we are flexible. That it would take some time until we change some of those. This is what we're gonna be fighting for. This is what we're gonna be aiming for. And we've got to remove one block at a time."

At one point or another, Stronach said, "We do not want to dominate racing. We want to be part of it," and, "I've been out here a number of times. It always would seem . . . 'Stronach's kinda crazy. His ideas are crazy.' " Obviously, the man has a sensitive side.

"You've got to understand, I'm very resentful when you trash my reputation," Stronach said. "I need this like a hole in my head, right? I'm a certain age. I want to go skiing, be a ski bum or whatever."

Stronach has been pleading for a deregulated horse racing calendar in California from the moment Magna Entertainment bought Santa Anita and Golden Gate, 11 years ago. He reiterated his challenge on Tuesday, but without specifics, and accused the racing board of failing to lend a hand, even though such changes would require legislative action.

"What did you want the board to do?" wondered commissioner Bo Derek.

"To work for free enterprise," Stronach replied. "Free enterprise means if you've got a store you should be able to open your store whenever you think you can get the most customers. Either you understand free enterprise or you don't understand."

This is just a guess, but at the very least it is likely commissioners Jerry Moss (A&M Records) and John Harris (Harris Farms) have some grasp of the marketplace. Racing board vice chairman David Israel, who also serves on the Los Angeles Coliseum Commission, offered Stronach a fairly obvious follow-up:

"How do you reconcile your fervent belief . . . in the free enterprise system with your apparent affection for bankruptcy laws that protected MEC for actually bearing the results of what free enterprise did?" Israel asked. "MEC failed."

"MEC didn't fail," Stronach shot back. "I underestimated the rules and regulations, the inflexibility of the bureaucrats and the commission to bring forward changes. It was the fault of outside forces, of authorities, regulatory authorities not stopping the flow of huge amounts of money [in offshore betting] to the islands. With the regulations, we are in chains."

Israel, a former sportswriter, countered with a real-world analogy:

"I don't see a racetrack as a 'store,' " the commissioner said. "To me. It's a public trust. There are very few of them. They're very expensive to build. And essentially it is its own geographically centralized sports league. You're the NFL, you're Major League Baseball, you're the NHL. The track is the league. The owners of the horses are the team owners. The trainers are the managers, and the jockeys are the players, and so are the horses. And all of our American sports leagues . . . they're not for profit -- the league itself isn't an entity trying to achieve profit."

Stronach's statements during the course of the afternoon left no doubt about his low opinion of the nonprofit Oak Tree Racing Association -- host of the five Breeders' Cups run at Santa Anita.

"The Oak Tree thing just doesn't make business sense," he said. "If you've got a tennis club, a golf club, there's lots of things you can do. But when you run a business, you cannot operate like a club. We canceled the lease because it doesn't make sense."

But by the end of the session, after a dramatic piece of quiet diplomacy from horse owner Mace Siegel, Oak Tree suddenly made sense, at least in the short term, when Stronach relented and gave the green light to a 2010 Oak Tree meet to be held at Santa Anita.

On the face of it, temporary continuity is a good thing, and the rest of the season can unfold as it has in the past. Stronach, though, was far from satisfied. And it didn't look like he'd be heading for the ski slopes any time soon.