Updated on 01/23/2012 5:13PM

Churchill Downs Inc. and Jockeys' Guild reach agreement

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Churchill Downs Inc. will make payments to the Jockeys' Guild for the next several years under an agreement the two parties reached last week to replace a pact that expired at the end of 2011, the two sides said on Monday.

The agreement will likely defuse a situation in California that held the potential for significant financial impacts on Twinspires.com, the account-wagering company owned by Churchill Downs. In December, the California Horse Racing Board approved a "provisional" four-month license for Twinspires.com to operate in the state, the nation's largest account-wagering market, citing the lack of an agreement between the two sides.

Officials for the organizations would not provide financial terms for the deal, other than to characterize the agreement as "multi-year." A release from the guild said that Churchill would make payments to the guild "to subsidize health insurance, life insurance and disability benefits" to guild members.

Terry Meyocks, the national manager of the guild, said that the payments made by Churchill under the new deal "are consistent with our other partner tracks" through similar agreements, but he would not comment further.

Under the agreement that expired at the end of 2011, Churchill Downs had paid the guild approximately $330,000 a year, based on a formula incorporating the number of live mounts at each of Churchill's four tracks: Arlington Park outside Chicago, Calder Race Course in Miami, Churchill Downs in Louisville, and Fair Grounds Race Course in New Orleans. Churchill notified the Guild in mid-summer that it did not intend to renew the agreement.

Churchill's stance spurred the guild to embark on a public-relations campaign that included testimony by guild members in front of the California Horse Racing Board and the Illinois Racing Board. The guild members argued that the regulatory agencies should not approve Churchill's account-wagering license without an agreement.

The Illinois board initially agreed to review the terms of the license, but approved it late in December after concluding that it could not tie the license to rider issues, citing a state Supreme Court ruling. The California board issued its provisional approval while promising to review the license before its expiration at the end of April.

A number of other major racetrack operators have renewed similar arrangements with the guild, including the New York Racing Association and the Stronach Group.

When notifying the guild that Churchill did not intend to renew the agreement, the company cited other costs it had incurred relating to rider safety, including the expense of maintaining $1 million catastrophic injury policies at its four tracks.

In addition, the company cited costs to comply with the requirements of the National Thoroughbred Racing Association's Safety and Integrity Alliance, a voluntary certification program launched three years ago to address public concerns about the safety of racehorses at tracks.