06/06/2013 4:17PM

Florida breeding on the rise, and in need of racing cooperation

John Filer
Lonny Powell became the FTBOA’s chief executive in January 2012.

It would be difficult to find a more experienced or impassioned voice for Thoroughbred racing than Lonny Powell.

Powell, 52, took over as chief executive of the Florida Thoroughbred Breeders’ and Owners’ Association in January 2012 and wasted no time immersing himself in Florida’s Thoroughbred industry. Not that he was any stranger to the intricacies of the racing world, having served as a track president, corporate officer, regulator, trade association CEO, and advance-deposit wagering executive. He’d already worked closely with Gulfstream Park, Hialeah, Calder, the Florida Horsemen’s Benevolent and Protective Association, and the FTBOA in his prior positions.

If love of racing can be inherited, Powell comes by it honestly, having been raised in a racing family, his father, Taylor Powell, being a jockey for more than 20 years. A California native, Powell went on to work as a jockey valet, assistant starter, and track maintenance worker before completing his studies at the University of Arizona’s Race Track Industry Program. He later returned to Tucson to serve as director of that program.

Having owned Thoroughbreds and show horses, Powell never wanted a life apart from horses. He brought enthusiasm and skill to his positions as president, CEO, and chief operating officer at racetracks such as Longacres, Turf Paradise, Multnomah, and Santa Anita Park. He was the first corporate officer for Magna Entertainment Corp., hired as the executive vice president of operations for Santa Anita, Gulfstream, Golden Gate Fields, and Bay Meadows.

Powell is also well versed in regulatory issues, having served as CEO of the Association of Racing Commissioners International. In addition, he was chief compliance officer, policy chair, and internal review chair for the ADW company Youbet.com. He also owned and operated Lonny Powell Strategy & Solutions in Lexington, Ky., a management and consulting company.

We caught up with Powell in late May to gain some insight into Florida’s racing and breeding segments.

What is the current state of the Florida breeding industry, which has had some rough times since the downturn in the economy in 2008?

It was brutal across the country and certainly no different here in Florida, not just the industry but the overall economy as well. The big questions are: When have you hit bottom? Is recovery in sight? For us, the bottom was definitely 2011. The good news for Florida is we’re one of the only states or provinces in North America that showed a recovery in the prior year (2012).

The fact that Florida stallions were the only ones to sire more foals in 2012 than in 2011 is a big answer. We’re the only major breeding jurisdiction in North America that showed an increase in foals in 2012. Based on that, I think it’s safe to say there’s recovery in our business in the state and nationally, but it has to be looked at as a fragile and soft recovery.

Then we have the whole sales component, and certainly we’ve seen the beginning of some upticks in the horse sales. So far, 2013 has been an awesome sales year for Ocala Breeders’ Sales.

What we’re seeing in the horse country of Marion County is that people who were pretty much “hunkered down in the bunker” are actually spending money, whether it is in horses or real estate. That money is being spent more cautiously, and people are doing more homework. We’re cautiously optimistic that we are definitely on a rebound, but you don’t take it for granted and also try to nurture it because that recovery is very fragile.

Are new breeders coming into the state, replacing those who left?

Rather than an exodus, with none coming in to replenish, we’re seeing some new operations and new money coming in to replace those that left. One of the biggest challenges is – because our horse flesh here becomes such hot commodities – often times, our stallions get purchased and then taken overseas or to other places. That’s a double-edged sword because it shows you have something good going on and a lot of people are vying for the best stallions.

What incentives are in place to promote breeding activity, and do you foresee any changes to breeder incentives in the future?

Last year, we ended up with an all-time high with our breeders’ awards, with the state paying out 17 percent of what a horse earned. The one thing we don’t do is pay breeders’ awards to horses winning outside the state. That’s the way the law is. In a perfect world, you’d like to pay breeders’ awards every place. We also have Florida owners’ awards, which are paid by the racetracks, and those amounts are set by the different tracks.

Our Florida Stallion Stakes has been one of the strongest 2-year-old programs in the country. This is evolving into the Florida Sire Stakes and will expand out and start incorporating 3-year-olds and older horses in the future. The first Florida Sire Stakes under our watch will take place in 2014. The FTBOA has taken over administration of this program, instead of one racetrack.

Right now, the biggest challenge we have is the challenge of the unknown. We need to see how South Florida reconfigures its racing picture. It’s hard to make hard plans and come up with objectives when the tracks don’t have a finalized game plan in terms of future dates and stakes, etc. The tracks need to get a program stabilized.

Provided South Florida tracks can get their dates and competition determined and stabilized, we can look ahead, and we definitely want to build on our breeders’ awards, create new types of racing series, and build on the ones we have. Somewhere down the road, I would like to reinstitute stallion awards.

The state is in turmoil with the dates wars again emerging as both Gulfstream and Calder want to race concurrently this summer. What challenge does that present, and what position does the FTBOA take on the “racing dates war?”

First of all, the FTBOA wants to support and build up the Thoroughbred business. Therefore, we want to see track owners be successful and do well because if they do well, the industry does well. We also want to see them invest money and energy into the horses and into taking care of horse people. However, we don’t think it’s our position to take one side or the other in a corporate dispute or date issue. Those are the types of things that need to be worked out by the parties involved if there are business dealings and negotiations to solve. As long as it’s good for the industry and the people in Florida, we have not and will not take a side in one racetrack versus the other.

I think all three tracks have their place and value within Florida, so we’d like to see more Thoroughbred racing opportunities and see them all do well. We, like everyone else, are just anxious to see the competitive-dates issues resolved.

Are you doing anything behind the scenes to help the tracks work out a solution?

Having been a CEO of racetracks and regulatory organizations, I have a lifelong involvement with this business, so I have some collective knowledge and experience. I’m a lifelong advocate for racing and want to facilitate positive discussions among the various parties and always encourage cooperation. I believe I’m probably the only person in the state who’s frequently receiving phone calls and communications from all three major players in one day. With that comes a huge responsibility. The FTBOA has a great deal of relevance in the racing scene in Florida, and we have a responsibility to work with the tracks and horsemen as much as we can.

What are the ramifications for racing and breeding in the state if the two tracks do both run this summer?

It’s hard to tell. Historically, overlapping of racing dates has shown that it’s very difficult to sustain a strong field size at one track if another track in the same market area is running. Especially with the national horse population being fragile now, it’s going to take a few years for the foal-crop size to grow. With the thin numbers of horses of racing age, if field sizes get too small at either track, we have to ask how much this will affect the fans and their wagering, as wagering is what affects revenue strength. We’re going through uncharted waters here. It could make both tracks offer a product of less quality and quantity than normal, or, collectively, it could mean increased business when you combine two together versus one racetrack. Some people tell me they believe that the end result could possibly be even more Thoroughbred opportunities and jobs in South Florida.

I still think it would be better if these tracks do not overlap. We’ve been very clear on that, for the record, and if they do race at the same time, they should have a cooperative racing week. We prefer they don’t forget there are a lot of people, including owners and breeders, that this affects.

I remain cautiously optimistic that there will be a deal worked out between these two tracks, with more clarity, harmony, and stability.

Is there a possibility that Thoroughbred racing can return to Hialeah?

Yes, I think there is. When I was a kid, my dad rode at Hialeah a couple years. At the time, it had almost a Saratoga-like stature. Some contractual and regulatory things would have to happen, but I don’t rule out Thoroughbred racing there in the future. If it can be done in a cooperative, non-combative fashion with the existing racetracks down there, it could happen. A conventional Thoroughbred program – not a mixed meet with Thoroughbreds and Quarter Horses – could be a good thing for our business, and the FTBOA would certainly be open to supporting it. There would need to be cooperation so that the tracks’ dates wouldn’t overlap with each other.

Annual mares bred to Florida stallions

Year Mares bred % No. Amer. Stallions % No. Amer. Avg. book Avg. No. Amer. book
2012 3,104 8.4 140 6.2 22.2 16.4
2011 3,029 7.7 155 5.8 19.5 14.6
2010 3,233 7.4 170 5.6 19 14.4
2009 4,187 8.6 187 5.7 22.4 14.9
2008 5,430 9.7 246 6.9 22.1 15.7
2007 6,383 10.6 253 6.7 25.2 15.9
2006 7,073 11.3 260 6.5 27.2 15.5
2005 7,191 11.4 263 6.3 27.3 15.1
2004 6,883 10.9 259 6 26.6 14.6
2003 6,670 10.7 261 6 25.6 14.2
2002 7,161 11.4 289 6.5 24.8 14.2
2001 7,172 11.4 295 6.4 24.3 13.7
2000 7,141 11.3 293 6.3 24.4 13.5
1999 6,973 11.5 312 6.6 22.3 12.8
1998 6,475 10.9 320 6.5 20.2 12.1
1997 5,961 10.2 302 5.9 19.7 11.5
1996 5,857 10.1 306 5.8 19.1 11
1995 5,935 10 306 5.5 19.4 10.5
1994 5,989 10.2 329 5.7 18.2 10.2
1993 5,798 9.6 351 5.6 16.5 9.6
1992 5,664 8.9 370 5.5 15.3 9.4
1991 6,093 9 396 5.5 15.4 9.4

Figures as of 05/01/2013  
North America includes U.S. and Canada only 

Annual registered foal crop 

Year Florida No. Amer. % No. Amer. crop
2011 2,029 25,200*  8.1
2010 2,414 27,913 8.6
2009 2,927 31,875 9.2
2008 3,535 34,691 10.2
2007 4,376 36,898 11.9
2006 4,495 37,544 12
2005 4,499 37,834 11.9
2004 4,496 37,414 12
2003 4,513 36,551 12.3
2002 4,425 35,452 12.5
2001 4,396 37,311 11.8
2000 4,551 37,193 12.2
1999 4,406 36,279 12.1
1998 3,905 35,287 11.1
1997 3,532 34,403 10.3
1996 3,692 34,640 10.7
1995 3,651 34,330 10.6
1994 3,587 34,709 10.3
1993 3,527 36,535 9.7
1992 3,574 37,828 9.4
1991 3,816 41,176 9.3

* estimated foal crop for 2011

Figures as of 05/01/2013   
North America includes U.S. and Canada only  

Florida-bred racing statistics by racing year 

Racing Year Starters Starts Earnings Avg. earn. per starter Avg. starts per starter
2011 7,787 54,452 146,550,367 18,820 7
2010 8,791 61,212 160,824,092 18,294 7
2009 9,626 67,241 168,511,651 17,506 7
2008 9,798 68,773 185,582,491 18,941 7
2007 9,886 69,763 184,439,274 18,657 7.1
2006 9,871 70,619 181,577,343 18,395 7.2
2005 9,956 72,085 172,686,430 17,345 7.2
2004 10,014 73,805 170,705,956 17,047 7.4
2003 9,962 73,598 170,149,900 17,080 7.4
2002 9,777 74,703 174,957,258 17,895 7.6
2001 9,323 73,446 171,615,936 18,408 7.9
2000 8,785 72,142 163,884,129 18,655 8.2

Figures include racing in the U.S. and Canada only.

Florida racing overview 

Year Races Purses Starters Starts Race Days Field Size
2012 3,383 90,984,951 7,356 27,651 335 8.2
2011 3,387 90,282,150 7,901 29,402 332 8.7
2010 3,233 76,909,950 7,493 28,274 323 8.7
2009 3,254 72,798,830 7,452 28,440 327 8.7
2008 3,443 78,404,970 7,413 29,085 344 8.4
2007 3,660 90,215,130 7,584 30,423 356 8.3
2006 3,733 85,409,600 7,786 30,971 356 8.3
2005 3,732 81,504,048 7,851 31,322 358 8.4
2004 3,766 82,943,298 8,225 32,455 363 8.6
2003 3,806 85,220,610 7,895 32,339 366 8.5
2002 3,752 81,960,124 7,415 31,356 365 8.4
2001 3,968 83,468,069 7,616 32,948 390 8.3
2000 3,924 77,587,468 7,221 31,793 391 8.1

Note: Purses represent all available money, including monies not won and returned to state breeder or other funds.