01/07/2005 12:00AM

Guild may face squeeze on funding


The Jockeys' Guild is facing the possibility of losing a significant portion of its annual revenue after representatives from two racing organizations said that the Guild has failed to provide them with information about its finances.

Chris Scherf, the executive vice president of the Thoroughbred Racing Associations, said Friday that the Guild had not responded to a request for details on how it spent $2.2 million provided by TRA member tracks in 2004. The Guild's failure to respond is jeopardizing the continuation of the payments, Scherf said, which are provided by the tracks on a voluntary basis. The TRA sent a follow-up letter to the Guild this week requesting audited financial statements promptly, according to Scherf, who said the Guild was initially asked to respond by Jan. 3.

Earlier this week, officials of the California Horse Racing Board said they would not release approximately $1 million to the Guild until its officials had answered highly specific questions about its finances and outlined how the Guild communicates with its members about the insurance coverage jockeys receive. The state of California typically distributes the payment, which comes from uncashed mutuel tickets, in the first quarter of the year, and the money is required by law to go toward jockey insurance and disability payments.

Guild officials did not reply to a request for comment on Friday. The Guild, which reports 1,259 members, is a trade group, not a union. The Guild has been pressing for increased accident insurance coverage, and the issue led to walkouts by jockeys at two Midwestern tracks late last year.

Although the Guild's current financial status is unclear, in 2002 the organization had $6.8 million in revenue, according to forms filed with the Department of Labor. The California and TRA payments.

Scherf said that, to his knowledge, no TRA track has determined whether to provide funding to the Guild in 2005. The TRA itself, Scherf said, "can't mandate the payments, so we can't mandate non-payments," because of the association's status as a trade organization. The decision on whether to contribute to the Guild would be made by each individual track, Scherf said.

The payments are made throughout the year, based on the number of mounts by jockeys at each track. The payments are scaled according to the amount of handle on each track's races, with larger tracks providing the largest payments.

An ongoing debate among many racetrack members is whether they should continue to provide payments to the Guild if the organization is not using the money to purchase insurance. The payments were originally made to the Guild in exchange for jockeys giving up their broadcast rights for simulcast purposes under a contract that expired in 2002. TRA tracks have continued to provide the payments without a contract.

The Guild's reluctance to provide information about its finances is complicating an already complex effort to determine how the industry should respond to increase the amount of catastrophic insurance for jockeys. An industry task force meeting scheduled for Tuesday to develop recommendations on the topic has been postponed, according to Keith Chamblin, a senior vice president of the National Thoroughbred Racing Association and co-chairman of the panel.

"This is a very complex issue, and there is some remaining work that needs to be done," Chamblin said. A meeting will likely take place in the next two weeks, he said.

The task force, which includes two Guild officials, had earlier agreed that the amount of catastrophic insurance provided by racetracks is inadequate. Racetracks pay for policies that cover jockeys for up to $100,000 in medical bills. The Guild had previously purchased a policy that covered jockeys for expenses past the $100,000 cap and up to $1 million. The group canceled the policy in 2002 because it had become too expensive, Guild officials have said.

According to one of the task force members, racetracks have had discussions with insurance companies that would require a payment of $1,900 per racing day for coverage that is capped at $1 million, up from the current payment of $1,000 a day.

"You'd get a 90 percent increase in benefits with only an increase of 50 percent in premium," the official said. "But no one knows yet who is supposed to pay for that."

The NTRA task force adopted language at its first meeting in November that said that all members of the industry should contribute to the increased coverage.