04/28/2016 11:36AM

Crist: Canterbury betting on lower takeout


Canterbury Park made a bold and popular decision when it announced last week that it was reducing the parimutuel takeout for its upcoming race meet. Its new rates of 15 percent on straight wagers and 18 percent on all others will be the lowest in the nation when the Shakopee, Minn., track opens a 69-day meet on May 20.

“We want to be the most horseplayer-friendly track in America,” said Eric Halstrom, the track’s vice president for racing operations.

The hope is that the lower rates will prompt a surge in volume that will at worst make the takeout reduction revenue-neutral and at best increase profitability. People keep calling this a theory, but it has been proven in more than a dozen takeout-reduction experiments over the last 40 years that it works.

Canterbury is well positioned to show substantial gains. It has had virtually no national simulcasting presence, so almost any business from players wanting to vote their approval of the new rates will be entirely new business. What will be more interesting is whether the move will increase volume from existing customers betting more because their returns are higher.

Canterbury officials also proved their sincerity with a less-publicized move this past week. Canterbury had previously announced a jackpot-style pick five wager similar to Gulfstream’s Rainbow 6. Tracks across the country are scrambling to institute similar wagers, dreaming of a day when their track might handle $15 million on the wager, as Gulfstream did March 26.

The problem with these jackpot wagers is that because the full pool is paid out only on a day when there is a single, unique winning combination sold, the effective daily takeout makes the state lottery look like a smart bet. For all the hoopla over Gulfstream’s big handle when there was a mandatory payout last month, it took more than 40 consecutive days of carryovers to get there, during which fans were effectively paying more than 50 percent takeout rates every day.

Canterbury could hardly keep ballyhooing a takeout reduction to a blended 16 percent or 17 percent level while simultaneously charging three times as much for a jackpot bet. So, the track announced this week that it was scrapping the new bet. Hats off to Canterbury for being consistent in its belief that lower rather than higher takeout is the way to drive business.

New York passed over again

Just imagine the caterwauling from California if it was not awarded a Breeders’ Cup for more than a decade, during which time New York hosted the event seven times. East Coast bias! The old-boy network! The industry hates California! It would be disgraceful, and no one could blame California for seceding from the event.

Yet no one seems to care that there has not been a Breeders’ Cup in New York since 2005.

New York was not awarded the event for the 13th consecutive time when it was announced this week that the 2018 Breeders’ Cup will be held at Churchill Downs. For almost a decade now, the Breeders’ Cup has been using the fallacious excuse that the ongoing tussles between New York state government and the New York Racing Association make it impossible to award the Cup in the face of such instability. This has always been nonsense because there never has and never will be any chance that racing is going away in New York.

Cup officials tried to relocate the event permanently to Southern California in recent years, even though the event usually handles less money there than at most other venues, but fortunately received enough blowback from the industry at large to revert to the rotation of sites that the event’s founders envisioned. The best news about the selection of Churchill is that it confirms that course after the next two Cups are held in California.

As for New York, which has stopped applying for the Cup in recent years but wants back into the rotation, it might be another four or five years before it has a shot. With the next three Cups awarded to Santa Anita, Del Mar, and now Churchill, the 2019 event is the earliest that a Belmont Breeders’ Cup could be. It might get pushed back even further if, as expected, Belmont Park is in the midst of renovations by then.

The Breeders’ Cup should rotate among the nation’s three prime racing centers – California, Kentucky, and New York – perhaps with a wild-card track every fourth year. Such a schedule is the fairest thing for racing, its participants, and the fans. What isn’t fair is a 15-year absence from New York.